Finnair has encouraging start to the year
07.05.2007
Finnair’s operational result for January-March improved by more than ten million euros from the previous year. according to a company statement. The result climbed to a profit of nearly six million euros. Turnover rose by ten per cent to 528.5 million euros.
“We have worked hard to make Finnair’s operations more efficient and to improve the company’s profitability, and in this work we have not been able to avoid painful solutions. Through our own actions we have, however, managed to turn last year’s weak financial performance into a clearly better effort this year. In the light of today’s forecasts, we have potential to exceed the 70 million euro operational result achieved in 2005,” says Finnair’s President & CEO Jukka Hienonen.
Finnair scheduled passenger traffic grew in the first quarter by 20 per cent from the previous year, while the European average was around five per cent. Finnair’s Asian traffic grew by over 35 per cent. Asian traffic passenger and cargo revenue grew by over 40 per cent and capacity will be increased by 30 per cent in the latter part of the year. In May-June, Finnair will take delivery of two new Airbus A340 wide-bodied aircraft. Finnair’s entire long-haul fleet will be renewed during the next three years.
“Demand is now strong both in Asian traffic and on European routes. We will quadruple our Indian traffic. Operating permits are now being awarded at many busy Asian airports and we want to ensure that Finnair’s colours are seen among the ranks of aircraft at these airports. In Europe we have already opened five new destinations this year,” explains Hienonen.
Fuel costs have stabilised at a high level. Euro-denominated operating costs rose in January-March by six per cent, but unit costs for flight operations fell by three per cent. Unit revenues improved by slightly under two per cent.
“Development of unit revenues in all traffic categories is positive and unit costs are declining, so profitability is improving. All four of our business areas recorded a positive result. I am particularly delighted with the improvement of profitability at Finnair Technical Services,” adds Hienonen.
Last year, Finnair initiated an 80 million operational efficiency programme. Half of the programme will be realised this year and the profit impact will be fully evident in 2008. The programme includes the cutting of 670 jobs in support functions. At the same time, the number of jobs in flight operations will grow due to increased traffic.
At the end of April, Finnair signed a preliminary agreement on the sale of its Swedish subsidiary FlyNordic to the Norwegian airline Norwegian Air Shuttle. As a consequence of the arrangement, Finnair will receive a holding of more than five per cent of Norwegian’s shares. As part of the agreement, Finnair and Norwegian will build a strong link between Scandinavian and Asian destinations.
“We have worked hard to make Finnair’s operations more efficient and to improve the company’s profitability, and in this work we have not been able to avoid painful solutions. Through our own actions we have, however, managed to turn last year’s weak financial performance into a clearly better effort this year. In the light of today’s forecasts, we have potential to exceed the 70 million euro operational result achieved in 2005,” says Finnair’s President & CEO Jukka Hienonen.
Finnair scheduled passenger traffic grew in the first quarter by 20 per cent from the previous year, while the European average was around five per cent. Finnair’s Asian traffic grew by over 35 per cent. Asian traffic passenger and cargo revenue grew by over 40 per cent and capacity will be increased by 30 per cent in the latter part of the year. In May-June, Finnair will take delivery of two new Airbus A340 wide-bodied aircraft. Finnair’s entire long-haul fleet will be renewed during the next three years.
“Demand is now strong both in Asian traffic and on European routes. We will quadruple our Indian traffic. Operating permits are now being awarded at many busy Asian airports and we want to ensure that Finnair’s colours are seen among the ranks of aircraft at these airports. In Europe we have already opened five new destinations this year,” explains Hienonen.
Fuel costs have stabilised at a high level. Euro-denominated operating costs rose in January-March by six per cent, but unit costs for flight operations fell by three per cent. Unit revenues improved by slightly under two per cent.
“Development of unit revenues in all traffic categories is positive and unit costs are declining, so profitability is improving. All four of our business areas recorded a positive result. I am particularly delighted with the improvement of profitability at Finnair Technical Services,” adds Hienonen.
Last year, Finnair initiated an 80 million operational efficiency programme. Half of the programme will be realised this year and the profit impact will be fully evident in 2008. The programme includes the cutting of 670 jobs in support functions. At the same time, the number of jobs in flight operations will grow due to increased traffic.
At the end of April, Finnair signed a preliminary agreement on the sale of its Swedish subsidiary FlyNordic to the Norwegian airline Norwegian Air Shuttle. As a consequence of the arrangement, Finnair will receive a holding of more than five per cent of Norwegian’s shares. As part of the agreement, Finnair and Norwegian will build a strong link between Scandinavian and Asian destinations.
