Finnair (Helsinki) reported a third quarter net profit of €16.6 million ($20.8 million) ending on September 30, down over 38% from the amount of €27 million ($33.8 million) reported for the same quarter in 2013.
CEO Pekka Vauramo commented:
“Finnair’s passenger and cargo revenue for July–September declined year-on-year, causing our turnover to decrease to 622.7 million euros. The decline in unit revenue, caused primarily by the strengthening of the euro against key Asian currencies, continued in the third quarter, although at a slower rate than earlier in the year. Growth in passenger volume and the progress of cost reduction measures were not sufficient to compensate for the weak revenue development, as our operational result fell to 26.7 million euros.
In order for Finnair’s profitability to improve, it is essential that we increase unit revenues and maintain tight control over costs. By the end of September, we had nearly achieved the overall target for our 200-million-euro cost reduction program. The program will be completed by the end of the year. The savings agreements we concluded with pilots and cabin crew in September and October will contribute to our cost competitiveness from 2015 onwards. I am very pleased with the outcome of the negotiations, as they not only produce cost savings, but also enable us to continue to develop our operations together with our personnel.
In August, we announced a number of product upgrades with which we pursue additional revenue. We expect our first A350 aircraft, which join our fleet in late 2015, to show an impact on our profitability from 2016 onwards. A significant improvement in revenue before that, however, would require a substantial recovery in domestic market demand and a substantial decrease in the world market price of fuel.” –
Copyright Photo: Paul Bannwarth/AirlinersGallery.com. Airbus A319-112 OH-LVA (msn 1073) completes its final approach to the runway at Zurich.
Finnair aircraft slide show:
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Video: Business class on Finnair: