MONTREAL — Loyalty program operator Aimia Inc. (TSX: AIM) swung to a loss in a quarter that saw its share price plunge after Air Canada said it was parting ways with the company.
The Aeroplan program operator reported a net loss of $25.1 million or $0.19 per share for the quarter ending June 30, compared with net earnings of $7.2 million or $0.02 per share for the same period last year.
The company said earnings are so far not impacted by Air Canada’s decision to replace Aeroplan with its own loyalty program by 2020, but Aimia was forced to suspend its dividend because of a capital impairment test required by the Canada Business Corporations Act.
Aimia said in results released after market close Wednesday that it is focused on reducing its cost base and securing long-term partnerships response to the airline’s decision.
The company said Aeroplan activity was up in the quarter, with no material change in redemption trends, and has maintained its overall 2017 company guidance.
Aimia’s share price closed at $1.59 Wednesday, down sharply from the roughly $9 a share it was trading at before Air Canada announced its decision on May 11.