2023 Consolidated Financial Statements and Notes
AIR CANADA
2023 Consolidated Financial Statements and Notes
8. LONG-TERM DEBT AND LEASE LIABILITIES
Aircraft financing (a)
Final Maturity
Weighted
Average
Interest Rate
(%)
December 31,
2023
(Canadian dollars in
millions)
December 31,
2022
(Canadian dollars in
millions)
Fixed rate U.S. dollar financing
Floating rate U.S. dollar financing
Fixed rate CDN dollar financing
Floating rate CDN dollar financing
Fixed rate Japanese yen financing
2025-2030
5.00
$
2,877
$
3,408
2027
7.81
296
399
2026 2030
3.78
165
182
1,240
2027
1.84
110
121
Convertible notes (b)
Credit facility - CDN dollar (c)
2025
4.00
327
313
2028
1.21
1,091
1,054
Senior secured notes - CDN dollar (d)
2029
4.63
2,000
2,000
Senior secured notes - U.S. dollar (d)
2026
3.88
1,589
1,626
Senior secured credit facility - U.S. dollar (d)
2028
9.13
3,000
3,102
Long-term debt
5.50
11,455
13,445
Lease liabilities
Air Canada aircraft
Regional aircraft
Land and buildings
Lease liabilities (e)
Total debt and lease liabilities
Unamortized debt issuance costs and
discounts
Current portion - Long-term debt
Current portion - Air Canada aircraft
Current portion - Regional aircraft
Current portion - Land and buildings
Long-term debt and lease liabilities
2024 - 2031
5.24
1,377
1,667
2025-2035
5.70
711
917
2024 - 2078
5.62
449
454
5.44
2,537
3,038
5.48
13,992
16,483
(130)
(177)
(359)
(713)
(337)
(337)
(144)
(187)
(26)
(26)
$
12,996
$
15,043
(a) Aircraft financing (US$2,396 million, CDN $165 million and JPY ¥11,749 million) (2022 - US$2,809 million, CDN
$1,412 million and JPY ¥11,748 million) is secured primarily by specific aircraft with a carrying value of $3,774 million
(2022 $5,745 million). For the majority of the financing, principal and interest is repayable quarterly until maturity and
can be repaid at any time with the payment of applicable fees. US$43 million of the financing is supported by a loan
guarantee by the Export-Import Bank of the United States.
In the first quarter of 2023, Air Canada drew on financing for the final two Airbus A220 aircraft under a committed
secured facility. The financing on these two aircraft was subsequently prepaid when the Corporation prepaid loans of
$1,112 million which had been used to finance the acquisition of 33 Airbus A220-300 aircraft. In addition, financing of
$164 million previously used to fund the acquisition of five Boeing 787-8 aircraft was also prepaid. A loss of $10 million
was recorded on these debt settlements.
As a result of the prepayments, these aircraft have been added to the Corporation's unencumbered asset pool.
(b) In June 2020, Air Canada closed US$748 million ($1,011 million) of convertible unsecured notes ("Convertible
Notes"), for net proceeds of $986 million. The Convertible Notes bear interest semi-annually in arrears at a rate of 4.0%
per annum and will mature on July 1, 2025, unless earlier repurchased, redeemed or converted. The Convertible Notes
are convertible at the Corporation's election, into cash, or into Class A Variable Voting shares and/or Class B Voting
shares of the Corporation, or a combination of cash and shares. The Convertible Notes are convertible prior to the
close of business on the business day immediately preceding March 1, 2025 only under the circumstances and subject
to satisfaction of the conversion conditions set out in the indenture for the Convertible Notes, and at any time on or
after March 1, 2025 until the close of business on the second scheduled trading day immediately preceding July 1,
2025, the maturity date of the Convertible Notes, regardless of the foregoing conditions, in each case at the option of
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