Investor Presentaiton
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resulting reduction in passenger revenues and/or increases in insurance, security or other costs could have a material
adverse effect on the Corporation's business, results from operations and financial condition.
Epidemic Diseases (Severe Acute Respiratory Syndrome (SARS), Influenza or Other Epidemic Diseases)
As a result of the international outbreaks of Severe Acute Respiratory Syndrome (SARS) in 2003, the World
Health Organization (the "WHO") issued on April 23, 2003 a travel advisory, which was subsequently lifted on April
30, 2003, against non-essential travel to Toronto, Canada. The seven day WHO travel advisory relating to Toronto, the
location of the Corporation's primary hub, and the international SARS outbreak had a significant adverse effect on
passenger demand for air travel destinations served by the Corporation and Jazz, and on the number of passengers
traveling on the Corporation's and Jazz's flights and resulted in a major negative impact on traffic on the entire network.
The WHO warns that there is a substantial risk of an influenza pandemic within the next few years. An outbreak of
SARS or of another epidemic disease such as influenza (whether domestic or international) or a further WHO travel
advisory (whether relating to Canadian cities or regions or other cities, regions or countries) could have a material
adverse effect on passenger demand for air travel and on the number of passengers traveling on the Corporation's and
Jazz's flights. Any resulting reduction in traffic on the Corporation's and Jazz's network could have a material adverse
effect on the Corporation's business, results from operations and financial condition.
Casualty Losses
Due to the nature of its core operating business, the Corporation may be subject to liability claims arising out of
accidents or disasters involving aircraft on which the Corporation's customers are traveling or involving aircraft of
other carriers maintained or repaired by the Corporation, including claims for serious personal injury or death. There
can be no assurance that the Corporation's insurance coverage will be sufficient to cover one or more large claims and
any shortfall may be material. Additionally, any accident or disaster involving one of the Corporation's aircraft or an
aircraft of another carrier maintained or repaired by the Corporation may significantly harm the Corporation's
reputation for safety, which would have a material adverse effect on the Corporation's business, results from operations
and financial condition.
Seasonal Nature of the Business, Other Factors and Prior Performance
The Corporation has historically experienced considerably greater demand for its services in the second and third
quarters of the calendar year and significantly lower demand in the first and fourth quarters of the calendar year. This
demand pattern is principally a result of the preference of a high number of leisure travelers to travel during the spring
and summer months. The Corporation has substantial fixed costs that do not meaningfully fluctuate with passenger
demand in the short term.
As described elsewhere, demand for air travel is also affected by factors such as economic conditions, war or the
threat of war or terrorist attacks, fare levels and weather conditions. Due to these and other factors, operating results for
an interim period are not necessarily indicative of operating results for an entire year, and operating results for a
historical period are not necessarily indicative of operating results for a future period.
Regulatory Matters
The airline industry is subject to extensive Canadian and foreign government regulations relating to, among other
things, security, safety, licensing, competition, noise levels and the environment and, in some measure, pricing.
Additional laws and regulations may be proposed, and decisions rendered, from time to time which could impose
additional requirements or restrictions on airline operations. The implementation of additional regulations or decisions
by Transport Canada, the Competition Bureau and/or the Competition Tribunal, the Canadian Transportation Agency,
the Treasury Board or other domestic or foreign governmental entities may have a material adverse effect on the
Corporation's business, results from operations and financial condition. The Corporation cannot give any assurances
that new regulations or revisions to the existing legislation, or decisions, will not be adopted or rendered. The adoption
of such new laws and regulations or revisions, or the rendering of such decisions, could have a material adverse effect
on the Corporation's business, results from operations and financial condition.
The availability of international routes to Canadian air carriers is regulated by agreements between Canada and
foreign governments. Changes in Canadian or foreign government aviation policy could result in the alteration or
termination of these agreements and could adversely affect the Corporation's international operations.View entire presentation