- Revenues reached $509.6 million, an increase of 28.3%
- Operating income before amortization and goodwill charges increased 44.5% to $15.1 million, compared with the first quarter of 2000
- Cash flows from operating activities increased 37%
- Sales volumes increased both in Canada and in France

Transat A.T. Inc., the leader in the vacation travel industry in Canada, recorded revenues of $509.6 million for the quarter ended January 31, 2001, an increase of 28.3% over revenues of $397.4 million posted for the same period the previous year.

Operating income before amortization and goodwill charges increased substantially to reach $15.1 million, compared with $10.4 million during the first quarter of 2000. For the quarter, the Corporation recorded a net loss of $0.6 million ($0.02 per share), compared with $0.6 million ($0.02 per share) for the same period last year.

'We are very satisfied with these results,' indicated Jean-Marc Eustache, President and Chief Executive Officer of Transat A.T. 'The significant increase in revenues is largely attributable to increased volumes and higher selling prices in Canada and also by higher sales volumes recorded by Vacances Air Transat (France) and the consolidation of the activities of certain companies subsequent to the first quarter last year,' he continued. 'In addition, we have significantly increased both our margins and our cash flows from operating activities - from $52.8 million to $72.4 million, an increase of more than 37% over last year,' he stated.

Transat's before-tax results were reduced by $2.5 million due to the results of Anyway.com, its French online travel agency, which reached the operational stage. Mr. Eustache added, 'Anyway.com experiences excellent growth, enhances our distribution network and positions us for the future. Gross billings for fiscal 2000 were 23 million euros, and they have already increased 100% this first quarter.'

In Canada, the combined revenues of the Transat group's tour operators and of Air Transat increased more than 30%, growing in all regions. Last year's revenues had been affected by the year 2000 issue, which pushed travellers to postpone their holidays abroad. In France, the increase was 8% in local currency. In general, results were affected unfavourably by the cost of fuel, which remained high (despite the favourable impact of adding a surcharge to selling prices), the decline in value of the Canadian dollar against its U.S. counterpart, the exchange rate of the euro, the increase in interest expense, and the increase in certain operating expenses including aircraft maintenance.

Highlights
During the first quarter and since January 31, Transat continued to pursue its vertical integration strategy.

In January, Transat acquired the leading Canadian incoming tour operator, Jonview Corporation, within the framework of a transaction to be conducted in two stages. An amount of $10 million was paid for the acquisition of a 50% interest in the company, whose annual revenues are $100 million.

In addition, in March 2001, the Corporation announced three acquisitions. First, the Corporation acquired the specialized outgoing tour operator Rêvatours (Montreal) for a cash consideration of $3.3 million. The Corporation also announced the increase to 100% of its interest in the Toronto tour operator World of Vacations, subject to the approval of the Competition Bureau.

Finally, through its French subsidiary, Look Voyages, the Corporation acquired a 40% interest in the incoming tour operator Tourgreece in Athens. Transat holds an option to become the majority shareholder in three years.

Outlook
Considering the first quarter results, the trends from the beginning of the second quarter, and market conditions, management is optimistic about the results of the winter season, which covers the first two quarters of the year.

About Transat A.T. Inc.
Transat A.T. Inc., with its head office Montreal, is an integrated company specializing in the organization, marketing, and distribution of holiday travel. The core of its business consists of tour operators in Canada and France. Transat is also involved in air transportation, hotel management, and value-added services offered at travel destinations as well as in distribution through both travel agency networks and e-commerce initiatives. Transat A.T. Inc. is a public corporation listed on the Toronto Stock Exchange (TSE:TRZ). In 2000 Transat recorded revenues of $1.9 billion.