Iceland’s PLAY Airline Projects 800,000 Passengers This Year

A PLAY airline Airbus approaching Stansted airport
Photo Credit: Colin Cooke Photo, CC BY-SA 2.0 , via Wikimedia Commons

LONDON – Iceland’s second quirkiest air carrier, PLAY airline – with the first being WOW, which went bust a while ago – projects that by the end of this year (2022), it will carry approximately 800,000, passengers and is expected to produce a revenue of around USD 150-160 million.

Furthermore, the unit cost (CASK excluding fuel) of the airline continues to slip as the airline shrinks its operations, thus streamlining current operations.

PLAY hopes to be operationally profitable by the end of this year. The airline PLAY has fortunately reached its cost target well earlier than expected, being beneath 4 US cents CASK excluding fuel.

This is because the airline has been able to achieve effective cost control and an increase in the economy of scale, with more aircraft in operations.  

In the concluded second quarter, the main focus of the airline was to prep for the upcoming notorious summer schedule, and its hub-and-spoke operation out of Reykjavik Airport.

At the beginning of the third quarter, the airline’s operation is in full steam with 6 A320neos in operation. PLAY has therefore successfully opened flights to fourteen new markets in the previous quarter. 

PLAY Airline Records strong booking traffic and a constant rise in revenue

Unsurprisingly, EBIT (Earnings Before Interest and Taxes) was in the red, which stood at USD 14.4 million in the second quarter of 2022, as PLAY had to achieve economies of scale. 

The Icelandic carrier continues to maintain a strong financial status, with cash and cash equivalents on June 30, totally at USD $39.5 million with restricted cash. Moreover, its equity ratio was 13.4%, and the airline has no external interest-bearing debt. 

Impressively, the revenue for this year’s second quarter stood at USD $32.5 million compared to only USD $9.6 million recorded in the 1st quarter.

This is to the increase in consumer confidence and the global recovery of air travel. This is also partially due to PLAY’s increase in the fleet. its network to a hu-and-spoke network previously from a sporadic point-to-point and a strong booking flow. 

However, losses were accumulated in the last quarter and were seen at USD $14.3 million loss compared to USD $1.4 million for the same period in the last year, when the airline had just briefly commenced its operations. 

The airline transported approximately, 181,000 passengers in the second quarter and witnessed a  load factor of 74.8. This number is seen as impressive, but could be higher as most low-cost carriers fares at above 80%.

The promising trajectory spilled over to the 3rd quarter, and 110,000 passengers flew with PLAY last month. This was attributed to the airline connecting Europe and North America. 

Birgir Jonsson, PLAY airline‘s CEO “We can safely say that PLAY has now emerged from the tough obstacle course of the startup and expansion phase, and smoother sailing is ahead.”

“Over the past months, we have created a solid foundation that we will use to keep developing PLAY as a successful company. The second quarter of 2022 was the last hurdle towards running our business model, which came into full effect in July, at the beginning of the third quarter.”

“After rapid expansion with many new destinations, the deployment of our VIA operations, and receiving new aircraft, our operations are now stable.”

“I am so proud of the people working at PLAY who have managed to start this company during a volatile time in a complicated business environment.”

“We are now coming out of the development phase with a strong financial position, and finally, the external conditions are more favorable after strong headwinds. Oil prices are, for example, going down fast.”

“We see brighter times ahead, our booking status is strong, and we plan on showing a positive operating result later this year. People are clearly not deterred from traveling because of the coronavirus anymore.”

“We see that in the increase of our long-term bookings and a drop in cancellation coverage. Our biggest objectives this coming winter are receiving four new aircraft, which will be added to our fleet next year, and hiring more crew members.”

“300 great people are already working at PLAY, and that group will be even bigger next year when we will hire 200 more.” 

At the time being, it is no game over for PLAY, as the airline still has strong booking demand throughout autumn and winter.

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