Chorus'Regional Aircraft Leasing shows Increases but Air Canada Business shows small decrease

     Chorus Aviation started it's regional leasing business about 18 months ago with a $200 million loan from Fairfax Capital.Chorus repaid it with a $200 million convertible debenture.Many thought they might not be able to pay it back nor redeem the debentures.But this has not been a problem since their regional aircraft leasing has been so successful.Since it's inception Chorus has leased 56 aircraft to smaller airlines.Most of it has been turboprops which Chorus has extensive experience with including a crack maintenance team and strong ties to Bombardier.Although Chorus has also leased some regional jets as well.It's strong relationship with Bombarier helps here also.                        

   
     Second Quarter Results
   Historically speaking Chorus had an average quarter.Adjusted EBITDA increased by $1.6 million to $86 million.Partly because     adjusted EBITDA from   their leasing segment  increased by $10.4 million.  Revenue earned from Air Canada had  a small decrease.Importantly they added 11 additional aircraft for a total of 56 aircraft in their leasing program. This has been accomplished in less than 2 years.However adjusted net income deceased by $5 million to $25 million.One new item here was a $4.5 million charge for interest costs related to their leasing program. That aside, net income increased from $16 million to $39 million for Q2.
     Turboprops or Regional Jets                

  Chorus uses both turboprops and regional jets in delivering passengers for Air Canada.But it's leasing program is more popular  with customers leasing turboprops than regional jets.For short distances turboprops are more efficient but the narrow body jets are more economical for longer distances.This blog believes that in order to increase it's visibility for excellence in regional jets a stronger bond with Bombardier should be forged.As it was Bombardier that created the CRJ series.In fact, just as Air Canada invested in Chorus so should chorus invest in Bombardier.And even with great fanfare hire some Bombardier staff.Its customers will know and hopefully lease more regional jets.Their new visibility aside, this blog sees a total of 65-69 aircraft leased by yearend.          https://www.desjardins.com/ca/index.jsp https://www.omers.com/