Investor Presentaiton
- 33-
In addition, consolidation in the airline industry could result in increased competition as some airlines emerging
from such consolidations may be able to compete more effectively against the Corporation which could have a material
adverse effect on the Corporation's business, results from operations and financial condition.
Strategic, Business, Technology and Other Important Initiatives
In order to operate its business, achieve its goals and remain competitive, the Corporation continuously seeks to
identify and devise, invest in and implement strategic, business, technology and other important initiatives, such as
those relating to the aircraft fleet restructuring program, the aircraft refurbishment program, the new revenue model, the
reservation and airport customer service initiative (which will also support the revenue model), the business process
initiatives as well as other initiatives. These initiatives, including activities relating to their development and
implementation, may be adversely impacted by a wide range of factors, many of which are beyond the Corporation's
control. Such factors include the performance of third parties, including suppliers, the implementation and integration
of such initiatives into the Corporation's other activities and processes as well as the adoption and acceptance of
initiatives by the Corporation's customers, suppliers and personnel. A delay or failure to sufficiently and successfully
identify and devise, invest in or implement these initiatives could adversely affect the Corporation's ability to operate
its business, achieve its goals and remain competitive and could have a material adverse effect on the Corporation's
business, results from operations and financial condition.
For instance, a key component of the Corporation's business plan is the restructuring of its aircraft fleet, including
the elimination and replacement of older, less efficient aircraft, the introduction of new regional jet aircraft, and the
modernization of its international wide-body fleet through the acquisition of new and more efficient aircraft. A delay or
failure in the completion of the Corporation's fleet restructuring, including a delay by the manufacturers in the delivery
of the regional jet or wide-body aircraft, or an inability to remove, as planned, certain aircraft from the fleet in
coordination with the planned entry into service of new aircraft, could adversely affect the implementation of the
Corporation's business plan which may, in turn, have a material adverse effect on the Corporation's business, results
from operations and financial condition.
Another important component of the Corporation's business plan is the replacement of its legacy systems for
passenger reservation and airport customer service with a newly developed web-enabled system in order to support the
rapid and efficient implementation of the Corporation's revenue model. The new system is expected to be deployed in a
phased manner commencing from late 2007 and running through a major part of 2008. A delay or failure in the
implementation of the Corporation's new system could adversely affect the implementation of the Corporation's
business plan which may, in turn, have a material adverse effect on the Corporation's business, results from operations
and financial condition.
Dependence on Technology
The Corporation relies on technology, including computer and telecommunications equipment and software and
Internet-based systems, to operate its business, increase its revenues and reduce its costs. These systems include those
relating to the Corporation's telecommunications, websites, computerized airline reservations and airport customer
services and flight operations.
These technology systems may be vulnerable to a variety of sources of failure, interruption or misuse, including by
reason of natural disasters, terrorist attacks, telecommunications failures, power failures, computer viruses, hackers,
unauthorized or fraudulent users, and other operational and security issues. While the Corporation continues to invest in
initiatives, including security initiatives and disaster recovery plans, these measures may not be adequate or
implemented properly. Any such technology systems failure could materially and adversely affect the Corporation's
operations and could have a material adverse effect on the Corporation's business, results from operations and financial
condition.
Key Supplies and Suppliers
The Corporation is dependent upon its ability to source, on favourable terms and costs, sufficient quantities of
goods and services in a timely manner, including those required for the Corporation's operations such as fuel, aircraft
and related parts and aircraft and engine maintenance services (including maintenance services obtained from ACTS).
In certain cases, such goods and services may only be available from a limited number of suppliers. Such failure,
refusal or inability may arise as a result of a wide range of causes, many of which are beyond the Corporation's control.
Any failure or inability of the Corporation to successfully source goods and services, including by reason of a failure,View entire presentation