Air Canada profit soared to a record annual high of $531 million last year, even as the slumping loonie caused the airline to lose $100 million in the last three months of the fiscal year.
Canada's biggest airline posted quarterly earnings early Wednesday that showed annual profit increased to a record level for the second straight year, up from $340 million last year.
That compares to the airline's loss of almost $500 million between 2008 and 2012.
But a big foreign exchange hit contributed to a $100-million net loss at Air Canada on a quarterly basis. The airline said the net loss amounted to 35 cents per diluted share.
Most of the airline's revenue comes in Canadian currency via ticket sales, but several of its costs, including jet fuel, are based in U.S. dollars.
For the year as a whole, the weaker loonie increased the airline's operating expenses by approximately $397 million, Air Canada said.
The weaker dollar was also responsible for most of the quarterly loss. But there was also a $30-million onetime item related to a new contract with Air Canada's pilots, ratified in October, and an $82-million unusual gain in 2013 from amendments to benefit plans.
Revenue for the three months ended Dec. 31 improved to $3.1 billion, up 7.2 per cent, or $210 million, from a year earlier.
Air Canada chief executive Calin Rovinescu says the airline served nearly three million more customers in 2014, including passengers of its low-cost Rouge service.
He said the airline expects significant cost savings from the drop in oil prices, but noted the environment remains volatile.
The price of a benchmark barrel of crude oil — used to make jet fuel, among other things — began to drop sharply the middle of the 2014 fourth quarter on its way to a six-year low in early 2015. It's currently trading at about $50 a barrel.