Writedowns related to its investments in asset-backed commercial paper once again hit the bottom line of Montreal-based travel company Transat A.T. Inc.

The company said Thursday that it made a profit of $40.7 million, or $1.21 a share, down from $53.8 million, or $1.57 a share, a year earlier.

The profit for the most recent quarter was trimmed after the company took a $17.9- million writedown on its ABCP holdings.

Three months ago, a $14-million writedown on ABCP caused Transat to post a $10- million loss in the first quarter.

There was good news at the top of the company's income statement as second-quarter revenues were up 18 per cent year over year to $1.08 billion on higher numbers of travellers in Canada and Europe, Transat said.

Revenues grew by more than 17 per cent in North America, and by almost 22 per cent in Europe. Traveller volume was up 34 per cent year over year.

"Demand has remained firm over the winter, and both bookings and prices for next summer are up compared with last year, fuelling our growth," said Jean-Marc Eustache, Transat's president and CEO.

He did, however, sound a note of caution about the short-term outlook.

"Competition remains intense and we are anticipating lower margins in the next two quarters compared with last year, mainly due to aircraft fuel prices, which are significantly higher and remain unpredictable," Eustache said. "Our economies of scale, financial situation and know-how lead us to be reasonably optimistic."