WestJet to pay first dividend

WestJet to pay first dividend

WestJet Airlines has confirmed it will pay its first dividend to shareholders as the Canadian airline sketched a positive outlook for its next quarter.

Calgary-based WestJet confirmed it would pay a quarterly dividend of five Canadian cents per share and reinstated its share buy-back program.

The news saw Canada’s second biggest airline gain five per cent in value on the Toronto Stock exchange today.

“Our shareholders have been loyal and supportive of our growth over the years,” said WestJet president Gregg Saretsky.

“We are pleased to announce our dividend and share buy-back program and provide our shareholders who continue to believe in our low-cost, high-value airline with an even greater return on their investment.”

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WestJet posted a 72 percent rise in quarterly profit, helped by improved margins, and said it is encouraged by the gradual recovery in pricing and the pace of its current bookings.

The airline principally flies domestic routes in Canada but also offers services to the United States, Mexico and the Caribbean.

Earnings totalled C$54 million ($53.6 million), or 37 Canadian cents a share, in the three months to September 30th.

That compared with earnings of C$31.4 million, or 24 Canadian cents a share, in the same period last year.

Revenue rose 14 percent to C$684.6 million.

Expectations

WestJet said it expects its fourth-quarter capacity to increase 13-14 per cent and expects to continue to see an improvement in its revenue per available seat mile (RASM), or unit revenue, a key airline measure.

“Our business model and our ability to consistently generate significant positive cash flow give us the confidence that we can maintain a healthy balance sheet while providing the necessary flexibility to fund our strategic objectives and growth plans,” concluded Mr Saretsky.