Chorus Aviation Q2 Earnings Call Highlights

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Mon, August 10, 2026 at 1:03 AM GMT+3 6 min read

CHR -1.08%

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Strong cash generation and shareholder returns: Chorus Aviation generated C$72.6 million in free cash flow and aircraft-sale proceeds during Q2, while adjusted EPS increased 54% year over year to C$0.83. The company repurchased C$14.8 million of shares and paid its C$0.11 quarterly dividend.
KADEX exceeded expectations: The newly acquired aerospace-parts business contributed C$16.4 million in revenue and C$1.2 million in net income during its first quarter under Chorus, with management citing additional integration and expansion opportunities.
Growth in defense and aviation services: Voyageur's MRO and defense revenue rose about 15% year over year, while the company advanced firefighting aircraft, parts-sales, Flexrotor unmanned-aircraft and special-mission initiatives. Chorus reaffirmed full-year guidance and is tracking toward the upper end of its range.

Chorus Aviation (TSE:CHR) reported second-quarter results marked by steady adjusted EBITDA, higher adjusted earnings per share, strong cash generation and continued expansion in aviation, aerospace and defense-related businesses.

President and Chief Executive Officer Colin Copp said the company generated C$117.7 million in free cash flow and aircraft-sale proceeds during the first half of 2026, including C$72.6 million in the second quarter. Chorus ended June with leverage of 1.5 times adjusted net debt to adjusted EBITDA and liquidity of C$204 million.

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"We are today a trusted Canadian partner with a global reach, focused on growing our aviation, aerospace, and defense platform," Copp said. He said the company's capital allocation priorities remain investments in growth opportunities, debt management and shareholder returns.

Financial Results and Capital Returns

Chief Financial Officer Gary Osborne said adjusted EBITDA totaled C$50.7 million in the second quarter, essentially unchanged from a year earlier. Higher contributions from Voyageur and newly acquired KADEX Aero Supply added C$6.5 million of adjusted EBITDA, primarily from parts sales, substantially offsetting contractual reductions in fixed-margin and leasing revenue under the Air Canada capacity purchase agreement.

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Adjusted net income per share rose 54% from the prior-year quarter to C$0.83. Osborne attributed the increase to operating contributions from Voyageur and KADEX, a C$2.5 million gain on aircraft sales, lower depreciation and interest costs, and a roughly 13% reduction in weighted average shares outstanding from capital-return activities.

Free cash flow was C$32.3 million, or C$1.41 per share, in the second quarter.
Chorus repurchased and canceled about 617,000 common shares for C$14.8 million during the quarter.
Year-to-date share repurchases totaled approximately 845,000 shares, or C$20 million.
The company paid a quarterly dividend of C$0.11 per share.
Combined dividends and buybacks returned C$17.3 million to shareholders in the quarter.

Since 2022, Chorus has returned approximately C$144 million to shareholders through its normal course issuer bid and two substantial issuer bids, Copp said.

KADEX Starts Ahead of Expectations

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Chorus completed its acquisition of KADEX Aero Supply on April 1. In its first quarter within the company, KADEX contributed C$16.4 million of revenue and C$1.2 million of net income, including C$0.5 million of amortization related to acquisition intangibles.

Management said the business was performing ahead of its initial expectations. Copp cited early integration opportunities across Chorus businesses and a broader opportunity set for KADEX's supply-chain and aviation-parts operations.

KADEX also completed a 10,000-square-foot warehouse expansion at Peterborough Airport. Chorus said the project doubled storage capacity and consolidated inventory, shipping and receiving functions in one location, supporting larger inventory levels and faster fulfillment.

Osborne said KADEX is expected to continue performing similarly through the remainder of the year, while Chorus evaluates additional opportunities to expand the business.

Aircraft Sales and Operating Developments

Chorus continued monetizing Dash 8-400 aircraft exiting the capacity purchase agreement fleet. Seven aircraft have been sold so far, including four sales completed in the second quarter. The sales produced C$40.4 million in proceeds during the quarter and C$58.4 million in the first half.

The two remaining aircraft are expected to close by the end of 2026 following engine overhaul work. Management expects the aircraft to generate approximately US$14.4 million in net proceeds. Osborne said the timing shift reflected normal delivery and maintenance matters rather than issues with the transactions.

At Jazz, Chorus said Air Canada Express service began from Billy Bishop Toronto City Airport to Chicago, Washington Dulles and Boston during the quarter. Jazz also completed its IOSA renewal audit and reached a tentative agreement with the Canadian Airline Dispatchers Association, which represents 56 flight dispatchers. Osborne said the labor agreement is covered under the Air Canada capacity purchase agreement's controllable-cost framework.

Defense, Special Missions and Parts Growth

Voyageur continued to develop its special-mission and defense capabilities. The first Dash 8-300 Fireswift aerial firefighting aircraft is in final certification, with a second aircraft expected to be completed next quarter. Voyageur also added ATR and Boeing inventory to its aftermarket-parts business and recorded its first Boeing 757 parts sales.

The company announced the purchase of an Airbus Flexrotor uncrewed aircraft system, making Voyageur the first Canadian customer and operator of the platform. Voyageur and Airbus also signed a memorandum of understanding to pursue Flexrotor service opportunities for commercial and government customers in Canada.

Copp said the Airbus arrangement is separate from Voyageur's engagement with 49North, an MDA Space company. Under the 49North relationship, Voyageur expects to combine its special-mission operations, maintenance and training capabilities with 49North's mission systems and data analytics in pursuit of intelligence, surveillance and reconnaissance work.

Management described the initial Flexrotor investment as modest and said it is included in the company's existing capital-expenditure outlook. While Chorus expects defense contracts to develop unevenly, Osborne said MRO and defense revenue was up about 15% year over year.

Chorus reaffirmed its full-year guidance. Osborne said the company is tracking toward the upper end of that range, supported by Voyageur, KADEX and Jazz, while management awaits further visibility on the balance of the year.

About Chorus Aviation (TSE:CHR)

Chorus is a holding company which owns the following principal operating subsidiaries: Jazz Aviation, the largest regional operator in Canada and provider of regional air services under the Air Canada Express brand; Voyageur Aviation, a leading provider of specialty charter, aircraft modifications, parts provisioning and in-service support services; Cygnet Aviation Academy, an industry leading accredited training academy preparing pilots for direct entry into airlines; and Elisen & Associates, a leading provider of aerospace engineering and certification services.

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The article "Chorus Aviation Q2 Earnings Call Highlights" was originally published by MarketBeat.

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