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Air Canada lost $386-million in the second quarter but saw ticket sales soar as travellers returned to the skies more than two years into the pandemic.

For the three months ending on June 30, operating revenue rose almost five times to $3.98-billion as Air Canada flew more than 9.1 million people – eight million more than in the same quarter of 2021.

The rush to return to flying has overwhelmed airports, airlines and government agencies, causing long lineups and delayed or cancelled flights at several airports. Air Canada reduced its schedule for June, July and August as it and other companies face staffing shortages.

“The industry worldwide is facing unprecedented conditions as it emerges from pandemic-related restrictions,” said Michael Rousseau, chief executive officer of Air Canada. “The situation is particularly challenging in Canada, where we have gone from a near two-year shutdown of air travel to rebuilding our capacity back to close to 80 per cent of 2019 levels in just a few months.”

Despite the strong demand, Air Canada’s results highlight the continued toll the pandemic and the travel shutdown is having on the airline industry.

Air Canada lost $1.60 a share, compared with the same quarter of 2021, when it lost $1.17-billion or $3.31 a share.

Walter Spracklin, a Royal Bank of Canada analyst, said Air Canada’s results were “mixed” but noted the airline did not alter its 2022 guidance and is headed in the right direction. Profit before taxes and margins were lower because of higher fuel prices and operating costs.

Air Canada said it entered the summer with 90 per cent of its 2019 staffing level to operate 80 per cent of its prepandemic schedule, but still found its flights and passengers faced long delays, especially at Toronto Pearson airport.

“We are working closely with our service providers and governments to keep addressing the issues aviation is facing in Canada and globally,” Mr. Rousseau said. “We acknowledge the inconveniences and disruptions some of our customers have faced, and we deeply regret this. This is not business as usual for us.”

Air Canada executives on a conference call with analysts on Tuesday spent much of their time accounting for the disruptions customers faced, apologizing while describing the problems as temporary.

Craig Landry, Air Canada’s operations chief, said the airline flew 84,600 flights in the second quarter, compared with 20,600 in the same period a year earlier.

“We’ve never seen demand increase at such a high rate in such a short period of time … after we have been at a near standstill for almost two years,” Mr. Landry said. “The same can be said of the many participants who are all part of the air transport system.”

The staffing shortages and lack of preparedness was seen at many of the companies and agencies that serve travellers, Air Canada said. These include security and customs officers, air traffic control, catering and baggage handing. Mr. Landry said the airline realizes it bears the focus of customers’ frustration when delays are because of any of those factors.

“This kind of instability has a direct impact on our operations,” Mr. Landry said.

The airline’s work force has 29,500 people, up from 16,500 in the same quarter of 2021.

Air Canada said the airport delays have been more pronounced in Canada – particularly at Toronto Pearson and Montreal – because the COVID-19 restrictions were in place here longer than in most countries. This led to greater pent-up demand that was unleashed as the rules were eased.

On April 1, the government dropped the requirement that travellers show a negative COVID-19 test. Since June 20, domestic travellers no longer need to be vaccinated, although foreigners entering Canada do.

Air Canada’s net losses since the beginning of 2020 total $9.8-billion in a crushing period for the aviation industry. The carrier’s net debt was $7-billion in the latest quarter, and it held $10.5-billion in cash, investments and available credit.

In 2021, Air Canada borrowed $1.4-billion from a government program to provide refunds to customers whose flights were cancelled in the pandemic. The government invested $500-million in the airline at $23.18 a share. Air Canada’s shares traded at $17.60 on Tuesday, up about 1 per cent.

The pandemic prompted governments to close borders, bar some flights and warn people to stay home to limit the spread of the deadly virus. COVID-19 has killed almost 43,000 people in Canada and 6.3 million people around the world, according to the World Health Organization.

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