Finnair reports financial for second quarter

The operational result for the entire first half of the year halved from the previous year's EUR33 million to EUR16 million. Finnair President & CEO Jukka Hienonen said, "Despite good fundamentals, we have been unable to insulate ourselves from sector developments, indeed the second quarter was clearly weaker than the previous year. The latter part of the year also seems difficult and the operational result for the second half of the year might dip into the red."

Unit revenues per tonne kilometre fell by 2.2% and units costs fell by 4.6%. Operating costs overall were increased particularly by fuel expenses, which rose in April-June by 38%.


Finnair's operational result for the second half of the year may be negative. The assessment is based on the end-July price of fuel and ticket prices remaining on last year's levels.

President & CEO Hienonen explains, "The situation in the sector may remain extremely difficult due to expensive fuel and uncertain development of demand. In the second half of the year, fuel costs are expected to account for around 28% of Finnair's turnover, whereas last year the jet fuel bill accounted for a fifth of turnover,"

Finnair's scheduled traffic growth, measured in passenger kilometres, was above the European average in January-June. Passenger traffic capacity grew 11% and demand by seven per cent, resulting in passenger load factor falling from the previous year by three percentage points to 72%. Asian traffic demand grew by over 20 per cent. In the early part of the year, Finnair carried four million passengers. The amount of cargo carried grew from the previous year by 15.3% to 52 million kilos.

Hienonen said, "Finnair's operational quality improved during the early part of the year, which is evident above all in punctuality and customer service. In punctuality we are again among the best of European airlines. Moreover, the amount of baggage delays has also fallen to a third of last summer's total."


(c) Centre for Asia Pacific Aviation. Date posted: 11-Aug-08

 

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