MONTREAL — Air Canada (TSX:AC) says it had $122 million of adjusted net income in the first quarter, or 41 cents per share.

That’s a record high for the airline and a $254-million improvement from a year earlier.

The profit was above the estimate of 18 cents per share, according to Thomson Reuters.

Air Canada says it also had a record high operating margin, as expenses fell amid lower jet fuel prices.

It says demand was also solid, pushing up passenger traffic – especially on leisure routes to southern destinations.

Before adjusting for items such as foreign exchange and fuel hedging, Air Canada had a net loss of $309-million or $1.08 per share. That was improved from a 2014 first-quarter net loss of $341 million or $1.20 per share.