Transat A.T. Inc. (TRZ) Earnings Call Transcript & Summary

[Foreign Language] Good afternoon, ladies and gentlemen. Welcome to the Transat conference call. [Foreign Language] As a reminder, today's conference is being recorded, Thursday, March 12, 2020. [Foreign Language] I would now like to turn the meeting over to Christophe Hennebelle, Vice President, Corporate Affairs. Mr. Hennebelle [Foreign Language], please go ahead.

Hi, everyone, and welcome to the Transat conference call for the presentation of the financial results of the first quarter ended January 31, 2020. I'm here with Jean-Marc Eustache, President and CEO; Annick Guérard, COO; and Denis Petrin, CFO. Denis will review the financial results, and we will then answer questions from financial analysts. Questions from journalists will be handled off-line. The conference call will be in English, but questions may be asked in French or English. As usual, our investor's presentation has been updated and is posted on our website in the Investors section. Denis may refer to it as he comments. Today's call contains forward-looking statements. There are risks that actual results will differ materially from those contemplated by those forward-looking statements. For additional information on such risks, please consult our filings with the Canadian Securities Commissions. The call also contains certain forward-looking statements concerning a transaction involving the acquisition of all shares -- all the shares of the corporation. These statements are based on certain assumptions deemed reasonable by the corporation, which are subject to certain risks and uncertainties, several of which are outside the control of the corporation, which may cause actual results to vary materially. In particular, the completion of the transaction with Air Canada will be subject to customary closing conditions, including regulatory approvals, particularly authorities in Canada and the European Union. Notably, a public interest assessment regarding the arrangements are being undertaken by Transport Canada. As part of this process, the Commissioner of Competition will provide Transfer Canada with its assessments of the impacts on competition. If the required regulatory approvals are obtained and conditions are met, it is expected that the transaction will be completed by the second quarter of the calendar year 2020. Forward-looking statements represent Transat's expectations as at March 12, 2020, and accordingly, are subject to change after such date. However, we disclaim any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future reasons or otherwise, other than as required by the law. Finally, we may refer to IFRS and non-IFRS financial measures. In addition to IFRS financial measures, we are using non-IFRS measures to assess the corporation's operational performance. It's likely that the non-IFRS financial measures used by the corporation will not be comparable to similar measures reported by other issuers or those used by financial analysts as their measures may have different definitions. Measures used by the corporation are intended to provide additional information and should not be considered in isolation or as a substitute for IFRS financial performance measures. Additional information on non-IFRS financial measures, such as their definition and their reconciliation with the more comparable IFRS measures, are available in our annual report. With that, let me turn the call over to Denis.

Thank you, Christophe, and good afternoon, everyone. We are reporting today on numbers for the first quarter for which the results are primarily driven by the Sun Destination Program. You can read in our press release this morning, we will not make an outlook for Q2 and next summer. I will come back to this in a few minutes. At the end, I will make some comments on the arrangement agreement signed with Air Canada. But first, allow me to say a few words on the adoption of IFRS 16 leases, the impact on comparative numbers. This standard was adopted on November 1, 2019, and the 2019 figures for the entire year were restated. Changes are described in the Note 3 of our financial statements. And a summary is also available on our investor presentation, that I think there are lots of information for everyone to take into consideration to adjust the 2019 numbers. Here are the most important changes. On our statement of income, the lease expense for leases under the new standard is replaced by depreciation of a right-of-use asset and interest on lease liability. The IFRS maintenance expense has decreased as major maintenance events are now capitalized and amortized over their use -- expected useful life. 2019 numbers have been restated for comparison purposes. Though it has changed the way our P&L look like, the impact on the 2019 adjusted net income versus the methodology used until last year is not very significant, $3 million decrease for the quarter and less than $100,000 for the entire year 2019. On our statement, financial position, the net present value of the future lease payments is now accounted on the balance sheet as a right-of-use asset and as a lease liability. As of October 31, 2019, $656 million increase in property, plant and equipment to account for the right-of-use assets and capitalized maintenance and a $666 million increase in lease liability. Other changes include a $155 million increase in the provision for return condition for leased aircraft and engines and $125 million increase in deposits as maintenance deposits to lessors, which were previously recorded as a reduction of the provision for overall of leased aircraft and the elimination, finally, of the provision for overall of leased aircraft. Finally, a $23 million increase in retained earnings as of October 31, 2019. Globally, results for the first quarter were in line with the outlook expressed last December. For all programs combined, Q1 results were as follows: revenue of $693 million, up $45 million or 7% versus 2019; an adjusted operating income of $27 million compared with an adjusted operating loss of $8 million last year. The adjusted net loss was $20 million compared with $39 million in 2019. On our Sun Destination Program, our capacity was 11% higher than last year. Margin were higher due to a decrease in airline unit costs, decrease in hotel cost and a slight decrease in operating expenses resulting from the combined effect of fuel cost and currency fluctuations. On the transatlantic route, margins were also higher than last year. Globally, the increased profitability for the quarter was mainly driven by Sun Destination Program, our main program for the winter season. Now for the balance sheet. Corporation free cash total $682 million at the end of January versus $620 million last year. Cash interest or otherwise reserve totaled $411 million. Our credit facilities remain unused. Deposit for future travel stood at $809 million compared with $753 million at the end -- as of January 31, 2019. Off-balance sheet agreements stood at $1.3 billion as of January 31, same amount than at the end of October. This amount, $1.3 billion, is mainly related to 15 Airbus A321 NEOs to be delivered from 2020 through 2022. Here are our booking and compare with the same date last year. For Q2 on the Sun Destination, our capacity is 5% higher. Currently, 83% of that capacity has been sold. Load factor are up 1.7 -- lower 1.7%. And if all indicator remain stable, the combined effect of USD fluctuation and fuel costs will result in a slight decrease in operating expenses. Taking all those metrics into account, unit margin are 0.8% higher than those recorded on the same date last year. On the transatlantic program, load factor are down 1.6% and prices are similar. Versus summer on the transatlantic program, our capacity is 3% higher. Currently, 34% of our capacity has been sold. Load factor are down 1.7% and prices are down 5.7%. Combined effect of fuel cost and currency fluctuation will result in a 4% decrease of operating expenses if they remain where they are. Now since the last week of February, daily bookings have been lower than last year, and the variance has increased significantly in the past few days when we have seen year-over-year variances of around 50%. It is impossible to assess the duration nor the severity for the coming weeks. We have taken certain number of measures to protect our cash, and we will continue to do so as the situation evolves. Nonetheless, in the current situation, again, it is impossible to predict the effect of the coronavirus on future reservations. As you can read in our press release, we will not make any outlook for the second quarter and for the summer, like I said at the beginning. Few remarks now on the transaction with Air Canada. August 23, 2019, significant majority of corporation shareholders voted in favor of a special resolution approving the previously announced plan of arrangement pursuing to which Air Canada will acquire all of the issued and outstanding voting shares of Transat for a cash consideration of $18 per share. The arrangement remains subject to customary closing conditions, including regulatory approvals, particularly those of Canada and European Union. Report from the Canadian Competition Bureau is expected before the end of March. It should be borne in mind that in the context of the public interest assessment, the bureau's evaluation is very likely to be limited to competition challenges that the transaction may pose. The report is, therefore, very likely to have a negative overall tone as has been the case in the First Air, Canadian North transaction. No conclusion should be drawn from this as the final decision relative to the transaction. As a reminder, Transport Canada will submit their report to Minister Garneau on May 2. This report will not be made public. The minister will then make his recommendation for the final decision. We are still expecting the transaction to close in the second quarter of the calendar year 2020 if the required regulatory approvals are obtained and conditions are met. In conclusion, results were better in Q1, and we were well positioned for the rest of the year. We are now attentive to the recent developments related to the coronavirus and remain on our way to the transaction. We will now proceed with your questions.

[Operator Instructions] Our first question comes from Mona Nazir of Laurentian Bank.

Firstly on the Air Canada transaction, and I believe the next step is the Competition Bureau report that you referenced. I'm just wondering how often are you interacting with individuals from Air Canada. And is it safe to assume that the discussions and your tone of exchange with them has -- is unchanged in light of the shift in kind of the macro backdrop? Or any comments you could say there?

Competition Bureau, as you know, will give his report on the 23rd of March. We're expecting that the report will be factual. So it will say, I suppose, there's a competition problem. They will not give any solution. That's not their mandate. I think the report will be, as we said, a little bit tough for the transaction, but we know it. It's part of the deal, and there's nothing special with that. Really, the transaction will be when Transport Canada will give its answer to the Minister and tell to the Minister the remedies that it should ask and to agree or not to agree with the transaction. So the report of the Competition Bureau really, for us, nothing that we can do, and we're still competitor with Air Canada. So we don't have any discussion about the Competition Bureau. Why? We do our thing. They do their thing. They do their representation that they have to do, and we do ours. So I don't know if I'm answering clearly to your question or not?

That's perfect. No, that's great. So no really ongoing discussions with individuals from Air Canada. At this point, you're both just waiting for the Competition Bureau report.

Yes. Yes.

Okay. And just secondly, you -- I believe, in the MD&A, you mentioned the 5% capacity increases in the Sun Destinations market. Given current conditions, how fast can you cut capacity? And how much reduction in capacity are you putting through at this point in time or expect to put through just given -- I mean I think you referenced 50% reduction in bookings, so...

We are following the situation very closely and adapting our flight program carefully and making, of course, the right decision at the right time. The decision that we've made in terms of changing our program admin on the short term, so mostly April up to mid of June. So we were able to downgrade some of our programs. We haven't made significant changes so far. We are waiting to see what's going to happen. With the exception maybe of Italy, of course, where demand has gone down significantly, but we are following demand and offer at the same time what's being offered by competition, tracking the moves that are being done and, again, being very, very careful. It's difficult to see how much capacity we will decrease at this time. But for sure, we will decrease a couple of percentage.

Okay. Perfect. And just last question for me. You mentioned cost-cutting and kind of how you're in a cash flow preservation mode. I'm just wondering if you could speak about some of these initiatives and how much -- what do these initiatives include? And how much savings do you think you can pull out of such?

So as Denis mentioned, one of the first thing we did is asking our employees to avoid all nonessential expenses, discretionary expenses, freezing hire, delaying projects, cutting on our time to travel and so forth. So we have launched as well the reduced workweek program. We are freezing CapEx expenses, putting a lot of projects on hold, cutting and lowering commercial and marketing investment. And in parallel, we have started negotiating more flexibility condition in terms of payments with our key suppliers, such as lessors, and we are looking, of course, at every financial measure to be able to predict our cash in the weeks and months to come, looking at where we have guarantees, where we have risk, working closely with our partners so that we get great collaboration from them.

Our next question comes from Konark Gupta of Scotiabank.

So first of all, on the IFRS 16 impact. Just wanted to make sure I see the numbers correctly. So I see your net debt number declined by $53 million as of October 31, 2019. Is that the correct assessment?

We'll just check that. Obviously, the methodology there is very, very different than what it used to be. It was calculated with a formula where today, we're taking the numbers on the balance sheet. Could we take this one off-line just to...

Sure. Yes. Absolutely. Yes. Okay. And then secondly, you mentioned the reserve cash for future bookings that you still have to deliver. Can you remind us what that number is on the reserve cash? And can that change or can that come down as bookings are canceled or fewer bookings are made?

Are you referring to customer deposits that we have in hand for future travel?

Yes, I think you mentioned some restricted cash or reserved cash, right, of $400 million or something.

Okay. In -- at the end of January, we were having something like $800 million of deposits from clients. And in one hand, you could see that in our liability on the balance sheet. On the other hand, what I was saying is that at the end of January, cash and cash equivalents on our balance sheet was $682 million. On top of this, we also have an amount of $410 million of cash and cash equivalents, interest or otherwise reserve because of some rules in different provinces in Canada, Québec, Ontario, B.C., proportion of cash remitted to the company has to be maintained in interest account or something close to this depending where we operate. Then when you look at our cash, again, we were having $682 million plus $410 million for a total of $1.1 billion.

I see. Okay. So that $682 million is free cash, like it's not earmarked for something. I mean you can use it for CapEx and you can use it for other kind of investments.

The way it works, when -- and we have cash interest or otherwise, again, reserve mainly during the winter period because it relates to sales that are made by the tour operators. Then this amount will just be reduced and are already smaller than this. And during the summer, this will probably be in the magnitude of less than $200,000 -- $200 million, sorry. Sales are going from tour operators.

Yes. Okay. That makes sense.

It's the tour operators and travel agencies.

Okay. Okay. And then on the Air Canada transaction, I just wanted to confirm one thing. So I think the original terms -- when the bid price or the offer price was $13 per share, the terms in those agreements were if there's any material adverse effect that happens, then the purchaser, or Air Canada, in that case, or you guys, Transat, can cancel the deal or terminate the deal or change the deal. So I think the definition for the material adverse effect is pretty wide and there's a lot of things like virus outbreaks, share price changes and those things. So we are seeing some of those events here where coronavirus has happened, and your stock price plus Air Canada's share price has also collapsed significantly. Does that allow or does that enable the transaction to go into renegotiation again? Or how do you think about that in terms of the impact on the transaction?

So the price of the share doesn't have anything to do, the condition of the market's got anything to do. And even for pandemic like it is right now, it's outside of the deal we have with Air Canada. So there's nothing material happening right now that can change the deal or the price of the deal. So the deal is there and will be there to the end.

Okay. It makes sense. And any thoughts on -- as Air Canada continues to do their due diligence and, obviously, there might be some impact you might see from weakness in Europe and transatlantic, is there any sense on your covenants or your kind of balance sheet, which might be part of a discussion with Air Canada in the next couple of months because of these changes?

No. There is no -- nothing happening. Air Canada is running its operation. We are running our operation. We do what we have to do, and there's no discussion with Air Canada at all. And the deal cannot change. The only thing is we go in front of the different regulatory, how do you say that, bodies and that's it. So we're waiting for the 23rd of March for the Competition Bureau. We have a good idea that -- what the Competition Bureau will say. And after that, it will go to Transport Canada. Transport Canada will make its recommendation to the Minister, and the Minister will give his decision to the government and government will give its decision. It's yes, no, or it's yes with some condition. This happened once before since the change of regulation. It's Canadian North and First Air. And as you saw, Competition Bureau said there will be no more competition. So this should not be this transaction. And finally, the Minister of Transport said, yes, it will be -- we'll have a transaction, but you will have to follow this, do this and that and that, and the 2 companies agreed and finally, they are one company. And it's a monopoly to go to north of Canada. And so we'll see what would happen. It's the decision of the Minister and the decision of the cabinet.

Okay, that makes sense. And is it -- do you think the process is happening on time? Are there any delays because of the economic outlook changing and Competition Bureau or Transport Canada are not able to kind of work on the deal as fast as you expected? Or do you think it's going ahead okay?

I think everything is okay. And the deal should be before -- like they always said to us before the government go in holidays, so end of June, and like we are saying. So there is no change about that.

Okay. And lastly for me, can you quantify your exposure to Italy in terms of how much capacity typically goes through Italy in the summer months?

So we start our Italy program on Rome around April 10. We have a couple of flights a week, around 2 flights a week, and then we move up during the peak season. And we also operate flights on Venice, and Venice we start on May 1 with a couple of flights out of Montreal and out of Toronto as well. Overall, in terms of capacity, it doesn't represent more than 12% of our overall program. But this is as the original program. Now that we have new -- now that we are moving capacity here and there and decreasing some programs, of course, a percentage will be affected.

[Operator Instructions] Our next comes from Jean-Francois Lavoie of Desjardins Securities.

So I was just wondering if you could remind us the delivery schedule for your new A321 NEO. Are you looking to push some deliveries in the future considering the current coronavirus outbreak or you would prefer to take those aircraft on and replace older aircraft?

So as you know, right now, we have 3 of those aircraft within our fleet. Last one arrived during the month of February. We are expecting 3 other to be able to operate during summer. So we will have 6 new operations during summer. And as of the next winter, we will have 10. So overall, of course, if we talk about the original schedule, there was a couple of delays, as we've mentioned in the past, between 3 to 6 months depending on the aircraft. But now we're pretty much comfortable with the calendar that has been communicated before Christmas. And we expect the aircraft, as I just mentioned, so 6 for summer and 10 during next winter. In terms of delaying, no, we would not do that. Just to get them on time is a lot of work for us, putting a lot of pressure on Airbus to be able to deliver according to the latest calendar they provide us with. And we are always making sure that we are keeping backups in case these aircrafts would be delayed. But so far, so good, and we will not take the chance to delay those aircraft any further.

Especially in moments like that, because, like Annick said, in some program right now, we were using the Airbus 330, and we're downsizing the program, and we continue the program with the Airbus 321neo long range. Where the Airbus 330 is between 230 or 345 seats, where the Airbus 321neo long range is 199. And as you know, we have some of the Airbus 330 that are going out of the fleet, I think it's 2 this year.

2 in fall.

2 in fall and 2 in next year. And those aircraft are the oldest ones. So we could put those aircraft on the ground because the lease are not expensive. But for sure, the lease of the Airbus 321 are more expensive, and they can -- they're brand new. So we can fly them as much as we can. So we got this Airbus 321. We don't want to delay those aircraft because those aircraft, for us, it's more flexible to use them, to fly them more, and because they're brand-new, there will be no much money to put on the maintenance, where the Airbus 330, we can downsize the aircraft, put that on the ground, and thank you very much. So for us, there's no reason to delay those aircraft, to be clear.

Okay. And then coming back to the transaction with Air Canada. I understand you cannot talk with them because of competition reasons. But I'm just wondering if you could provide a little bit more of color around your view of Air Canada's desire to pursue this transaction. I mean just to come back on the previous question, now that the market is kind of in a little bit of a panic mode with the coronavirus, I just wanted to have a little bit more details on your view of the transaction.

Yes. I'm not in the shoes of Air Canada. I will have difficulties to answer for the Air Canada. Air Canada is doing its thing. But it doesn't mean that because we have a problem for a period of time, like what it is right now, and it seems that it's going all over the place, this problem, when I'm listening, on one side, to the President of the U.S., what I'm listening to the Prime Minister of Quebec and everybody wants to do something, and I'm sure they're right, and they are taking a good decision. But it will not be a problem, I suppose, for the next 10 years. So -- and I think the deal with -- between Air Canada and Transat, anyways, for me, it's a long-term deal, and it's not short term. We will not take a decision for the next 6 months. They are taking this decision for the next 10 years. And as you know, this deal is a good deal for the 2 parties. It's a good deal for Air Canada, and it's a good deal for Transat. Transat is bringing a name, is bringing people that have knowledge, especially in the leisure market, given that the leisure market right now is suffering, it will come back, will not be dead, I suppose, but the line we said in French, I don't know how to say that in English. But it's a long-term deal. So I don't think they look at it like, okay, today, we are having a big problem, Transat has a big problem, all the airline business has a big problem worldwide. And so we're not going to take this deal and whatever comes in with the deal. That's my impression. But really, you have to ask Air Canada to -- if they [ view it ] like me or not.

Our next question comes from Cameron Doerksen of National Bank Financial.

You sort of partially answered my question, I guess, earlier, but I just wondered about your ability to ground aircraft with relatively limited expenses. I think you mentioned that the 4 A330s that maybe are on some more favorable lease terms. Is that really the kind of the extent of it? Or are there some other aircraft out there that have some favorable lease terms that you can park and not have significant costs associated with those?

All the Airbus 330, not the new one, all of those aircraft are with low leases. So at the end of the day, we could put 2, 3, 4, 5, I don't expect that. And I don't want to do that. That's not -- but we did it before in 2001, if you remember, we put 25% of the fleet on the ground. And if it's necessary to do it, we will do it today and -- or tomorrow, not today, but tomorrow. And at the end of the day, it will not be big, big expenses. And second, like we did in 2001, we went to see all the lessors. Transat -- and Transat doesn't own airplane. The only one that we own are the old Airbus 310, and those aircraft are hanging at the end of this month. We will put them on the ground. Some of them will still be used as backup, if necessary, and the rest will disappear. So we will go and see the lessor. It's part of what we are doing right now. And we will ask the lessor to say, okay, I cannot pay you this price, especially for the Airbus 321 right now. So you have to give me a break. And the last time we did it, they all give us a break. At the end of the day, 6 months after or 9 months after, you have to pay the difference, for sure. And you have to pay also the interest for that. So I'm sure that today, and right now, you got 100 airlines going to see the Sun lessors that we're going to go and see them. We start to have discussions with them, and we are going to see them asking for break, and they will give us a break because they have no choice either. And at the end of the day, for us, it's a way that we keep the cash, and we continue to operate. So it happened before, they did it, and it will happen this time again.

Our final question comes from Kevin Chiang of CIBC World Markets.

Maybe I'd follow-on, and I get the sense that the airline industry is looking at the situation that they're facing now as something worse than the Great Recession, and you've heard a lot of U.S. airlines say maybe even worse than 9/11, which is, I guess, pretty remarkable. You talked about what you did back in 2001. Does it feel like you'll need to make greater adjustments than you've seen maybe over the past 2 black swan events to your company, whether it's the financial crisis of 10-plus years ago or 9/11 of 20 years ago? And -- like if you're going to ground 20 -- if it ends up being grounding 50%, 60% of your fleet, like, is that a solution that makes sense as an operator to ground so much of your fleet given -- I guess, I'm just trying to figure out, like, at some point, I guess, the math doesn't work, right? Like, you take out too much capacity because your network isn't as robust, you don't have the ability to deploy to as many places. Like there's got to be a limit in terms of how much you can ground fleet before just -- it just doesn't make sense anymore.

Listen, how I can answer. I've been in the business. I don't want to seems too -- I'm old, for sure. It's 42 years I've been in the industry, and I've been there for the past 42 years. We saw different things, and we adapt ourselves to all those things. Today, how much is the problem? I have no idea at all. I'm like everybody, looking at it and reacting to that. The only thing I can say is I went through all those things, we did all that we have to do, we will do it again. We have good employees. They have been there for years. They know the organization. They adapt themselves. So this business, we will do what we have to do step-by-step, day-by-day, and we will, if we have to ground half of the fleet, it's not something that we want to do. It's not something that we're expecting to do today. But if we have to do it, we will do it. And we will go through, and we have some cash. And for sure, I suppose the governments will help us, and they have to do it. When we see the tax that we pay, when we see how much the airport we pay to use those airports, when you see everything that we're paying, tomorrow, all those guys will not have the customers that they have today. So they will have to do their part too, and we will all do it together, and we will go through that step-by-step. I'm not [ able to discern it ], like I said, I have no idea what will be tomorrow, but we will adapt, and we will go through, and I will be there, I suppose, for the next conference in June because the deal will not completely finish. It will be finished by the end of June. And I will tell you, I will be there and answering to your question. And for us, it's very easy because we can adapt ourselves very fast, very, very fast. It's leisure. So the people love leisure. They take the decision. They travel. They don't travel. They don't travel, we have to put the plane on the ground, we put the plane on the ground. We have to lay off people. It's not something that we want to do. It's not something I'd like to do. We will do it. We are very, very agile. And we never went through financial problem at the end of the day. So we are very agile. And like I always said, tourism goes back to the situation and after it come back, and we will survive, I guarantee you that, and you will see it.

That's helpful. Actually, just maybe on that point, a lot of focus has been on people canceling flights and I guess fearful of traveling today. I'm wondering, when you look at your web traffic, do you see people looking further out and maybe looking to rebook maybe outside of the normal booking curve? With -- is there maybe greater confidence that we find a solution after coronavirus here over the next quarter or 2, and that gives you a little bit of comfort that people are maybe just pushing out that potential spend, maybe they're not spending it this summer, but you can kind of see them that maybe they'll spend that dollar in the winter or next spring? Like do you have visibility on your website just to see that consumer behavior?

What we're seeing right now is that the -- well, first of all, we are still receiving bookings. So people are still booking for the summer season. But a lot of people, as you mentioned, are postponing their trips. So they're calling, making a decision on the web to postpone their trip to either another day or they're choosing other destination as well. And we are offering them this flexibility to be able to change their vacation. What we are observing in terms of when is that there's a lot of last-minute booking being done by a particular segment of the population. We are seeing youngest people that are talking about getting the best deal ever and deciding to go on vacation and decide at the very last minute. So of course, we are looking at this clientele right now and seeing how can -- we can better attract them. So these are the trends we are seeing. We are also in discussion with Google to understand where Canadians, what kind of search they're doing for which period of the year. Of course, in the short term, there's much less -- overall for Canadian, much less research, so there's more around peak season, around July and August, except again for the youngest, where we see a trend in the short term. So this is overall what we're seeing.

Okay. That's helpful. And I'm sure it's too early to -- or even if you have any color on this, you -- I think I've seen in the press as well that -- and maybe it was you, Jean-Marc, talking about the government maybe needing to step in to help the overall airline industry. Just wondering if there's anything you can share or anything you're looking for specifically from the government as this issue continues to kind of rush forward here?

If you listen to the conference of Mr. [ Trudeau ], he said that he's going to help everybody, and we are receiving -- and the government, federal and provincial, are already calling all the airlines, I'm sure, ourselves for sure, and telling us that what do you need, where we can help you, how we can help you to go through this bad time. So everybody is onboard right now, and we are working with them, and I'm sure we're going to have help of them because if not tomorrow, they will have thousand and thousands of people unemployed, and it will cost a fortune. So they're going to have to ask, and they are doing it. So I cannot say that they are not listening, they're even calling us before we call them to help us. So I'm pretty sure that they will be there, and we will find solution because it's a very, very special situation.

We have no further questions. I'll turn the call back over for any closing remarks.

Thank you, everyone. Let me just remind you that our second quarter results will be released on June 11, 2020. Thank you very much, and have a good day.

Thank you very much.

That does conclude the conference call for today. We thank you for your participation and ask that you please disconnect your lines. Thank you, and have a good day.