Air Canada: $3.7-billion pension deficit eliminated, small surplus at Jan. 1 - InfoNews

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Air Canada: $3.7-billion pension deficit eliminated, small surplus at Jan. 1

January 22, 2014 - 4:44 AM

MONTREAL - Air Canada (TSX:AC.A) says its domestic pension plans had a small surplus as of Jan. 1, according to preliminary estimates — contrasting with the $3.7-billion solvency deficit that they had a year earlier.

The airline says several factors contributed to the turnaround, including a 13.8 per cent return on investments in 2013.

Air Canada also applied a different ratio for calculating future pension obligations, reduced obligations through benefit amendments and made a $225-million contribution towards the solvency deficit.

Pension obligations have been a major drag on Canada's largest airline for many years, resulting in friction with Air Canada's labour unions at times as well as a significant operating expense.

The company says a final estimate of the domestic pension's financial health will be completed by the end of June.

News from © The Canadian Press, 2014
The Canadian Press

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