Published on : Wednesday, October 25, 2017
In the first nine months of this year, Austrian Airlines, Austria’s flag carrier, has been able to increase its adjusted earnings before interest and taxes (adjusted EBIT) by 27 percent to 100 million euros, compared to the same period of the previous year. This improvement in earnings was a result of the company’s business within Austria, strong business on routes between Germany and Austria, and in the long-haul segment, the continuing positive trend in North Atlantic flights. As at the end of September 2017, the airline transported 14 percent more people, with just below ten million passengers carried.
Austrian Airlines CEO Kay Kratky says the following: “After the difficult start to the year, we can be very happy with the way our earnings are progressing. First and foremost, however, we are encouraged by the solid demand from Austria.” CFO Heinz Lachinger adds: “For the first time in our history, we can show a three-figure result. Although we still have the winter ahead of us, this is truly remarkable with our economic history.”
The result in detail
Operating expenditure for the first nine months of the year rose by eight percent, or 133 million euros, to 1,798 million euros (comparison period for previous year: 1,665 million euros). Mainly responsible for this rise in expenditure were higher personnel costs due to the significant expansion in staff numbers (with 413 new employees taken on) and increased fuel and technical costs caused by a cluster of maintenance events.
In the same period, total operating revenue was raised by nine percent, or 156 million euros, to 1,904 million (2016: 1,748 million euros). Essential revenue drivers were increased demand in Austria, the expansion of business on routes between Germany and Austria, and a continuing positive trend in flights across the North Atlantic. As a result, the company posted a three-figure EBIT for the first time, of 106 million euros. The EBIT for the same period last year was 84 million euros, representing an increase of 26 percent. The adjusted EBIT, the indicator relevant for the forecast, which deducts valuation gains from aircraft sales amongst other things, was 100 million euros after three quarters, up by 21 million euros, or 27 percent, on the comparison period in 2016. Revenue at the end of Q3 2017 was 1,814 million euros, eleven percent higher than on September 30, 2016.
The summer quarter (Q3) has traditionally generated the most revenue for Austrian Airlines: revenue increased by nine percent compared to the 2016 summer quarter. Expenditure rose by eight percent, and revenue by ten percent. The EBIT increased from 82 million to 98 million euros. The adjusted EBIT went from 80 million in the third quarter of 2016 to 96 million euros in 2017 (see table on p. 3 for further details).
In total, Austrian Airlines carried some 9.8 million passengers in the period from January to September 2017. This represents a rise of 14 percent. The main reason for the strong increase is the expansion in flights between Germany and Austria, and the use of five additional aircraft “operated by airberlin”. Capacity, expressed in Available Seat Kilometres (ASK), rose by eight percent. Despite the increased supply, capacity utilisation also improved, rising by 0.4 percentage points to reach 77.4 percent.
The figure for punctuality on departure was 4.0 percent down on last year, unfortunately, at 83.2 percent, considerably below the level of punctuality usual for Austrian Airlines. The main reason for this were the freak weather conditions at the Vienna hub. With the stabilisation in flight operations, regularity of operations rose slightly once again, going up by 0.3 percentage points to 98.8 percent (2016: 98.5%).
The number of people employed by the Austrian Airlines Group, including its fully-consolidated subsidiaries, was 6,749 on September 30, 2017 (compared to 6,336 on September 30, 2016). The sharp rise in employee numbers of 413, or seven percent, is mainly a result of the company taking on pilots and flight attendants.
Outlook 2017: result increase targeted
“Although we are now entering the traditionally difficult and less profitable winter season, I assume from today’s perspective that we will see an increase in the annual result compared to the previous year”, CFO Heinz Lachinger concluded. The Adjusted EBIT for the 2016 financial year overall was 58 million euros.
Source:- Austrian Airlines
Tags: Austrian Airlines