Finnair has this week released it’s interim report for the first quarter of the year, highlighting a change from profit to loss.
The airline has stated the reasons why for this, as we will explore in this article.
Without further ado, let’s get into it…
The Numbers from Finnair…
Revenue at Finnair decreased 1.9% to 681.5m EUR. In 2023, this was recorded at 694.7m EUR.
Comparable operating result dropped from a 900,000EUR profit to a 11.6m EUR loss, with operating result being a loss of 17.2m EUR.
The number of passengers handled by the airline also dropped 1.9% to 2.5m.
Passenger load factor dropped from 75.1% to 72.1%, a whole three percentage points.
Interim CEO: Inflation Rising & Strike Action The Cause…
Jaako Schildt, the Interim CEO of Finnair had this to say on the results:
“Finnair carried 2.5 million passengers in January–March and revenue for the period totalled 681.5 million euros (694.7).”
“The revenue decrease was driven by the political strikes in Finland, normalised revenue recognition related to expired tickets and lower cargo yields, despite higher ancillary and travel services revenue.”
“On the other hand, operating expenses remained unchanged year-on-year due to a strict cost control and a lower fuel price even though capacity increased.”
“Comparable operating result in the seasonally weakest quarter was -11.6 million euros (0.9).”
“Demand remained good in the quarter and customers booked trips especially for the upcoming summer season.”
“As a result of the successful pricing, our yields remained strong despite a slight decrease year-on-year.”
“Also our operating cash flow was at a good level.”
“The strikes in Finland and in Europe negatively affected our on-time performance during the quarter.”
“Our on-time performance was also burdened by winter weather conditions, landing at 75 per cent (82).”
Overall…
In conclusion, Finnair believes that despite this financial negativity, this will get turned around again in the Summer.
Looking ahead, the airline does have some strong plans in place for the busy period of the year.
All eyes will be on how well they perform over this crucial point.
After all, this area of the year will make or break the financial performance for the rest of the year.
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