Air Canada (AC) Investor Day 2024 summary

Strategic vision and financial targets toward 2030

• Aims to reach over CAD 30 billion in revenue by 2028, with 7%-8% annual growth and 5%-6% annual capacity growth, supported by network expansion and demographic trends.

• Targeting adjusted EBITDA margins above 17% by 2028 and 18%-20% by 2030, with a structural free cash flow margin of ~5% and capex below 12% of revenue.

• Plans to generate CAD 20 billion in cumulative cash from operations (2024–2028) with a 90% EBITDA-to-cash conversion rate.

• Intends to reduce share count by 20% to below 300M by 2028, deploying over $2B to shareholder returns, and maintaining investment-grade credit quality.

• Focuses on disciplined capital allocation, maintaining a strong balance sheet, net leverage below 2x, and a performance-driven culture.

Revenue growth, network, and fleet strategy

• Expanding international network via three Canadian hubs, targeting high-potential markets such as India, Southeast Asia, and U.S. Sixth Freedom traffic.

• Adding approximately 90 new aircraft by 2028, including 787-10s, A321XLRs, A220s, and 737 MAXs, to drive efficiency and support premium product growth.

• Modernizing fleet to achieve 15%-20% better fuel and maintenance costs, consolidating Rouge to a single fleet type, and enabling new destinations.

• Targeting 20%-25% growth in premium capacity by 2028, with 24% growth in business and 20% in premium economy.

• Partnerships with major airlines and intermodal providers, and Aeroplan loyalty program growth, enhance network reach and revenue diversification.

Operational excellence and productivity

• Operational improvements, including AI-driven tools and predictive maintenance, have improved on-time performance by 17 points since 2022, with further 2-point annual improvements targeted for 2025 and 2026.

• Productivity initiatives and new aircraft expected to deliver a 13% improvement by 2028 and 20% by 2030, with 3%+ annual labor productivity gains.

• Self-service and digital transformation streamline customer experience and reduce costs, with maintenance technology and automation enhancing efficiency.

• Customer experience investments include expanded lounges, upgraded cabins, fast free Wi-Fi fleetwide by 2026, and improved food and beverage offerings.

• Operational improvements projected to contribute 70 basis points to EBITDA margin by 2028.