Ms. Annick Guerard reports

TRANSAT PROVIDES UPDATE ON THE VOLATILITY OF AVIATION FUEL PRICES

Transat A.T. Inc. is providing an update on the impacts of the significant increase in aviation fuel prices, exacerbated by the prolonged closure of the Strait of Hormuz. This increase continues to exert significant pressure on global energy markets and is particularly affecting the entire airline industry, resulting in a substantial rise in operating costs.

Since the beginning of this period of volatility, Transat has implemented various measures aimed at limiting, to the extent possible, the impact of the increase on its costs. These measures include, among others, the introduction of fuel surcharges on new bookings and targeted adjustments to the 2026 program, representing to date a reduction of approximately 6 per cent of planned capacity for the period from May to October, 2026. These measures are similar to those adopted by several other airlines worldwide.

For the months of March and April, fuel surcharges had a limited impact on Transat's revenues and only marginally offset the negative impact of the increase in aviation fuel prices. This is due in particular to the fact that a very large portion of bookings for this period had been made prior to the onset of the crisis. In this context, the effect of fuel surcharges on Transat's revenues is expected to remain limited in the short term and may only partially offset the increase in aviation fuel prices in the following months. Taking into account the effect of existing hedging instruments, the increase in aviation fuel prices resulted, for these two months, in additional costs of approximately $70-million, or an increase of more than 75 per cent, compared with March and April, 2025. The additional costs incurred by the company will be reflected in the results for the quarter ended April 30, 2026, which will be released mid-June, 2026.

"The significant current volatility in aviation fuel prices is occurring amid exceptional circumstances affecting the industry on a global scale. In addition to the cancellation of our flight program to Cuba until November, 2026, the impact on our costs is material and could persist if the situation, which is beyond our control, were to continue. Despite the measures we are implementing, we are not able to fully eliminate its effects. In this context, we continue to closely monitor developments and adapt our actions accordingly," said Annick Guerard, president and chief executive officer.

About Transat A.T. Inc.

Founded in Montreal in 1987, Transat has achieved worldwide recognition as a provider of leisure travel particularly as an airline under the Air Transat brand. Voted world's best leisure airline by passengers at the 2025 Skytrax World Airline Awards, it flies to international destinations. By renewing its fleet with the most energy-efficient aircraft in their category, it is committed to a healthier environment, knowing that this is essential to its operations and the destinations it serves. Based in Montreal, Transat has nearly 5,000 employees with a common purpose to bring people closer together.