Chorus Aviation Inc. Announces Second Quarter 2025 Financial Results

Executive Summary

• Chorus Aviation Inc. reported a significant turnaround in its second quarter of 2025, posting a net income of $32.4 million compared to a net loss of $180.6 million in the same period last year, driven by the sale of the RAL business and improved operational performance.
• The company announced the acquisition of Montreal-based Elisen & Associates Inc., a strategic move to expand its aerospace engineering and certification services capabilities.
• Management highlighted a commitment to returning capital to shareholders, including the initiation of a quarterly dividend, $27.2 million in share buybacks year-to-date, and the redemption of $28.7 million in outstanding Series B Debentures.

Key Details

• Financial Performance (Q2 2025 vs Q2 2024):
  • Net Income: $32.4 million (vs. net loss of $180.6 million).
  • Net Income from Continuing Operations: $32.4 million (vs. $8.5 million).
  • Adjusted Earnings available to Common Shareholders: $17.2 million ($0.66 per share, basic) vs. $1.9 million ($0.07 per share).
  • Adjusted EBITDA: $51.3 million (vs. $50.5 million).
  • Free Cash Flow: $34.6 million (vs. $28.2 million).
  • Leverage Ratio: 1.5 (vs. 1.4 at Dec 31, 2024).
• Year-to-Date Performance (Six Months Ended June 30, 2025):
  • Adjusted EBITDA: $108.2 million (vs. $104.5 million).
  • Adjusted Net Income from Continuing Operations: $32.6 million (vs. $23.4 million).
  • Net Income from Continuing Operations: $51.4 million (vs. $13.9 million).
  • Adjusted Earnings available to Common Shareholders: $32.6 million (vs. $5.6 million).
• Operational Drivers:
  • Growth in Voyageur’s parts sales, contract flying, and MRO activity.
  • Decrease in stock-based compensation of $2.4 million in Q2 due to immediate vesting of RSUs related to the RAL sale and changes in fair value of the Total Return Swap.
  • Decrease in general administrative expenses due to lower overhead costs.
  • Decrease in aircraft leasing revenue under the CPA of $3.4 million due to changed lease rates, partially offset by a higher US dollar exchange rate.
• Capital Allocation & Corporate Actions:
  • Initiation of a quarterly dividend intended to grow over time.
  • Completed $27.2 million in share buybacks (NCIB and SIB) through June 2025.
  • Redemption of outstanding Series B Debentures in the principal amount of $28.7 million.
  • Redemption of Preferred Shares, eliminating $9.0 million in preferred dividends for Q2 and $17.8 million YTD.
• M&A Activity:
  • Agreement announced in July to acquire Elisen & Associates Inc., a leading provider of aerospace engineering and certification services based in Montreal.
• Operational Milestones:
  • Voyageur delivered the first of two Dash 8-300 Fireswift aerial firefighting aircraft to customer Metrea.
• Outlook & Forecast (2025-2026):
  • Jazz Fixed Margin: $59.6 million (2025) and $43.9 million (2026).
  • Aircraft leasing revenue under CPA: $121.0 million (2025) and $104.0 million (2026).
  • Total Fixed Margin and Aircraft leasing less debt/interest payments: $100.6 million (2025) and $77.9 million (2026).
  • Wholly-owned aircraft leased under CPA at end of period: 45 (2025) and 39 (2026).
• Capital Expenditures Forecast (2025):
  • Total CapEx: $30.5 million to $45.5 million.
  • Breakdown: $18.0M-$23.0M (excluding aircraft), $10.0M-$15.0M (capitalized major maintenance), $2.5M-$7.5M (aircraft acquisitions/improvements).
• Fleet & Lease Details:
  • Current fleet: 48 wholly-owned aircraft and five spare engines.
  • Net book value: $761.2 million.
  • Future contracted lease revenue: US $340.5 million.
  • Long-term debt: $291.1 million (US $213.4 million), 100% fixed rate, weighted average cost of borrowing 3.31%.
  • Cabin refurbishment program initiated for E-175s and CRJ900s (Wi-Fi, seats, storage, power); costs paid by Air Canada.

Notable Quotes

• "Our second quarter results reflect solid performance on all key financial metrics and concrete actions to return capital to shareholders, while re-investing in Chorus' growth and high-potential capabilities," said Colin Copp, President and Chief Executive Officer.
• "Voyageur's continued strong performance, combined with consistent earnings from Jazz's capacity purchase agreement (CPA) with Air Canada, contributed to these results," added Mr. Copp.
• "The initiation of a quarterly dividend that we intend to grow over time with our business was a key step Chorus took to return shareholder value. We also completed $27.2 million in share buybacks so far this year... To further strengthen our balance sheet, Chorus today announced it will redeem its outstanding Series B Debentures in the principal amount of $28.7 million," said Mr. Copp.