by Natasha Lair
Last updated: 8:05 AM ET, Thu December 18, 2025
Transat A.T. Inc. reported its fourth-quarter and full-year 2025 financial results, posting record adjusted EBITDA for the fiscal year despite lower revenues in the final quarter.
For the year ended Oct. 31, 2025, Transat recorded adjusted EBITDA of $271.0 million, up 33% from $203.2 million in fiscal 2024.
Revenues rose 3.5% year over year to $3.4 billion, driven by higher yields and modest traffic growth, even as capacity increased by less than 1%.
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“Transat posted all-time record adjusted EBITDA in fiscal 2025,” said Annick Guérard, president and chief executive officer of Transat.
She cited growth from new routes, execution of the company’s Elevation Program and the refinancing of government debt, while noting ongoing challenges tied to Pratt & Whitney GTF engine issues and a volatile macroeconomic environment.
Fourth-quarter revenues declined 2.2% to $771.6 million, compared with $788.8 million a year earlier.
The decrease was primarily due to substantially lower financial compensation from Pratt & Whitney related to GTF engine issues.
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Excluding this factor, revenues would have increased 1.5% year over year. Adjusted EBITDA for the quarter fell to $71.4 million from $128.4 million in the same period last year, reflecting lower revenues as well as higher maintenance and labour costs.
Traffic for the quarter declined 2.0%, in line with a 1.8% reduction in capacity, while yields increased 3.3%.
Guérard said the company has met its objectives for fiscal 2025. She also noted that a tentative agreement with pilots and the successful renegotiation of all collective agreements provide labour stability through at least 2027.
Looking ahead, Transat expects capacity to grow between 6% and 8% in fiscal 2026, supported by targeted network expansion in Africa, Europe and South America, fewer grounded aircraft and continued network optimization.
“We are optimistic about accelerating our growth trajectory in 2026,” Guérard said.
Chief financial officer Jean-François Pruneau pointed to the company’s debt restructuring as a milestone in 2025.
Long-term debt and deferred government grants fell to $400.0 million as of Oct. 31, 2025, down from $803.1 million a year earlier. Net of cash and cash equivalents, long-term debt declined to $235.1 million from $542.7 million.
“The successful restructuring of our government debt proved to be a key milestone in 2025,” said Pruneau, adding that lower interest expenses and extended maturities through 2035 will support future growth initiatives.
Cash and cash equivalents stood at $164.9 million at year-end, compared with $260.3 million a year earlier. Free cash flow for fiscal 2025 improved to negative $45.0 million, compared with negative $122.1 million in fiscal 2024.
Transat said airline unit revenues for winter 2026 are currently tracking 1.4% higher than at the same point last year, while load factors are slightly lower.
The company will host its fourth-quarter conference call on Dec. 18, 2025.
First-quarter 2026 results are scheduled to be released on March 10, 2026.
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