KLM Group reports a sharp improvement in operating result for first quarter 2022

KLM Royal Dutch Airlines issued this report:

The recovery that set in during the second half of 2021 continued strongly in the first quarter of 2022. During the first three months of 2022, KLM succeeded in generating positive operating results (of +€3 million) for the third consecutive quarter. This represents an improvement of €340 million in comparison with the same period last year. There is still a long way to go to full recovery, but the current financial situation means that KLM has started to repay its loan package in the second quarter.

Turnover in the first quarter of 2022 amounted to €1,903 million; more than double that of 2021, when turnover totalled €930 million. Operating profits of €3 million were up €340 million in comparison with 2021, when there was a loss of €337 million. Bookings continued to pick up thanks to an increasing number of countries relaxing entry restrictions. The negative impact of the sharp increase in oil prices was mitigated by hedging.

KLM received its last contribution of €140 million under the emergency job-retention scheme (NOW) in the first quarter (previous year: €321 million), which contributed to the positive results.

Only €942 million was withdrawn from the loan package of €3.4 billion in 2020. And, as was also the case for 2021 as a whole, nothing was withdrawn in the first quarter of 2022. The repayment in the second quarter is €311 million, which reduces the outstanding debt of this loan package from €942 million to €631 million. If recovery continues, KLM may make further repayments later this year.

Improvements in all business areas

The first quarter of this fiscal year showed a mixed picture. Our customers are keen to travel again and are now able to, and this is reflected in the results. In total, we welcomed 4.8 million passengers on board, compared to 1.4 million in the first quarter of 2021. The upward trend in bookings continued despite the conflict in Ukraine and the closure of Russian airspace, forcing flights to and from South Korea, China and Japan to make a detour.

Once again, Cargo performance was excellent in the first quarter. Transavia also performed well, benefiting from the further relaxation of entry restrictions affecting holiday destinations. Engineering & Maintenance (E&M) showed a strong improvement in first-quarter turnover.

At the same time, key markets in Asia are still closed to international travellers. Additionally, the global airline industry is facing rising costs and scarcity in the labour market, which are putting pressure on operations. This also applies to KLM.

Operation under pressure despite commitment of KLM staff

Operations were already under pressure in the first quarter of 2022 due to numerous operational changes and scarcity in the labour market. This did not lead to any major disruptions. However, with steadily increasing passenger numbers and the situation at Schiphol in terms of capacity shortages in many places, the past few weeks have been very difficult for operations. Many thanks for all the efforts of KLM colleagues and sincere apologies to our customers who were inconvenienced.

“These first quarter figures clearly give cause for optimism. Despite geopolitical tensions, high inflation and rising costs, recovery continues unabated. Bookings are approaching their 2019 levels, and our customers are keen and able to travel with us again. We will start repaying the loans in the coming (second) quarter. This involves an initial amount of €311 million and hopefully more later this year. This is a very important step in many ways, serving to highlight the resilience and commitment of all KLM colleagues. In the coming period, we will be focusing on repaying the loans on one hand, and operations and work pressure on the other. Numerous measures are being adopted in this regard, so that summer will be better than the situation in recent weeks.”

KLM President & CEO Pieter Elbers

KLM aircraft photo gallery:

Jet Airways flies again!

Jet Airways on May 5, 2022, operated a positioning flight with the pictured VT-SXE.

Jet Airways made this announcement:

VT-SXE, operated a positioning flight on the evening of May 5 from Hyderabad to Delhi as flight 9W101. Some photos here of the aircraft in Delhi and of colleagues celebrating this momentous day!

Jet Airways operated a test flight in Hyderabad earlier on May 5, and a positioning ferry flight to Delhi thereafter.

Today, May 5, our 29th birthday, Jet Airways flew again! An emotional day for all of us who have been waiting, working, and praying for this day, as well as for Jet's loyal customers who can't wait for Jet to commence operations again. pic.twitter.com/2HcSHa0bTS

— Jet Airways (@jetairways) May 5, 2022

Jet Airways aircraft photo gallery:

SAS sees a 380% increase in traffic in April compared with last year

Scandinavian Airlines-SAS issued this traffic report for April:

During April more than 1.5 million passengers traveled with SAS, an increase of approximately 380% compared to the same month last year. SAS’ capacity increased at the same time by 190% compared with the same period last year. In comparison with last month, the total number of passengers increased with 7% and capacity was increased by 15%. The flown load factor for April was 71%, an improvement of 41 percentage points compared to April last year.

“We continue the ramp-up and see the highest number of passengers since March 2020. Looking forward, sales and booking trends are positive for the summer period ahead. Traffic to and from Asia remains a challenge due to remaining COVID-19 restrictions as well as the geopolitical situation, that impact the recovery of far-Eastern traffic. We remain focused on building a competitive and financially strong SAS, which will be achieved through the success of the SAS FORWARD transformation plan”, says Anko van der Werff, President & CEO of SAS.

SAS scheduled traffic	Apr22	Change¹	Nov21- Apr22	Change¹
ASK (Mill.)	2,794	184.1%	13,720	160.4%
RPK (Mill.)	1,980	561.4%	8,316	439.0%
Passenger load factor	70.9%	40.4 pp	60.6%	31.3 pp
No. of passengers (000)	1,526	378.2%	6,842	268.8%

Geographical development, schedule	Apr22 vs. Apr21		Nov21- Apr22 vs. Nov20-Apr21
	RPK	ASK	RPK	ASK
Intercontinental	1,732.3%	159.9%	1,254.7%	152.6%
Europe/Intrascandinavia	386.4%	363.9%	623.1%	349.0%
Domestic	166.3%	52.6%	129.3%	38.8%

SAS charter traffic	Apr22	Change¹	Nov21- Apr22	Change¹
ASK (Mill.)	74	2,576.9%	658	1,816.1%
RPK (Mill.)	65	5,743.1%	526	3,849.5%
Load factor	87.6%	47.5 pp	79.9%	41.1 pp
No. of passengers (000)	19	6,626.3%	171	4,644.9%

SAS total traffic (scheduled and charter)	Apr22	Change¹	Nov21- Apr22	Change¹
ASK (Mill.)	2,868	190.8%	14,378	171.1%
RPK (Mill.)	2,045	580.5%	8,842	468.2%
Load factor	71.3%	40.8 pp	61.5%	32.1 pp
No. of passengers (000)	1,545	383.8%	7,013	277.3%

¹ Change compared to same period last year, p p = percentage points

Preliminary yield and PASK	Apr22	Nominal change¹	FX adjusted change
Yield, SEK	1.03	-16.5%	-18.9%
PASK, SEK	0.73	94.3%	88.9%

			Apr22
Punctuality (arrival 15 min)			75.4%
Regularity			97.9%
Change in total CO₂emissions			125.9%
Change in CO₂emissions per available seat kilometer,			-4.4%
Carbon offsetting of passenger related emissions			50.8%

Definitions:

RPK – Revenue passenger kilometers

ASK – Available seat kilometers
Load factor – RPK/ASK
Yield – Passenger revenues/RPK (scheduled)

PASK – Passenger revenues/ASK (scheduled)

Change in CO₂emissions per available seat kilometers – SAS passenger related carbon emissions divided with total available seat kilometers (incl non-revenue and EuroBonus tickets), rolling 12 months vs rolling 12 months previous year

Carbon offsetting of passenger related emissions – Share of SAS passenger related carbon emissions compensated by SAS (EuroBonus members, youth tickets and SAS’ staff travel) during the month

From fiscal year 2020 we report change in CO₂ emissions in total and per Available Seat Kilometers (ASK) to align with our overall goal to reduce our total CO₂emissions by 25% by 2025, compared to 2005.

SAS aircraft photo gallery:

Swoop is expanding service to Kelowna

Swoop on May 5 launched its new daily, nonstop, flights between Kelowna and Edmonton with inaugural flight WO214 taking off from Edmonton International Airport at 8:35 a.m. MT and arriving at Kelowna International Airport at 10:45 a.m. local time.

The carrier introduced service between Kelowna and Winnipeg in May 2019. The ULCC will restart service between these two markets on May 6, with its inaugural flight WO502 from Kelowna to Winnipeg. In addition to connecting Kelowna with both Edmonton and Winnipeg, Swoop will also continue serving Toronto with four flights per week.

Schedule:

Route	Frequency	Total Price (CAD)	Base Fare (CAD)	Tax (CAD)
Kelowna to Edmonton	Daily	$49.00	$10.59	$38.41
Edmonton to Kelowna	“”	$49.00	$0.59	$48.41
Kelowna to Winnipeg	3x weekly	$79.00	$39.16	$39.84
Winnipeg to Kelowna	“”	$79.00	$26.16	$52.84
Kelowna to Toronto	4x weekly	$89.00	$48.69	$40.31
Toronto to Kelowna	“”	$89.00	$37.69	$51.31

For travel between September 1 – October 15, 2022 | Seasonal start and end dates apply and are indicated in the booking flow. | Fares are valid until May 19, 2022 (11:59 p.m. MT) or while seats last.

Swoop aircraft photo gallery:

American Airlines celebrates 250,000th veteran to participate in the Honor Flight Program

American Airlines joined elected officials, team members and volunteers in Washington, D.C., this week to celebrate a historic milestone for the Honor Flight Network, a nonprofit organization dedicated to providing veterans with once-in-a-lifetime trips to visit the nation’s capital and the memorials erected in honor of all those who have worn the U.S. military uniform. To commemorate the occasion, American also announced a donation of 15 million AAdvantage® miles to support and sustain the Honor Flight Network’s ongoing mission.

A milestone flight in honor of our heroes

On May 2, Flagship Valor — American’s newly dedicated Airbus A321 aircraft, which serves as a flying tribute to recipients of the Medal of Honor — departed from Phoenix Sky Harbor Airport with the 250,000th participant in the Honor Flight program, two Medal of Honor recipients and more than a hundred World War II, Korean War and Vietnam War veterans.

Medal of Honor recipient Jim Taylor welcomes more than 100 World War II, Korean War and Vietnam War veterans at PHX before boarding the milestone Honor Flight to the nation’s capital.

U.S. Sen. Kyrsten Sinema helps American’s all-volunteer flight crew care for Honor Flight participants while inflight from PHX to BWI.

The 250,000th veteran to participate in the Honor Flight program arrives on Flagship Valor to a hero’s welcome at BWI.

The veterans were accompanied throughout their journey by Honor Flight guardians and other volunteers, including American team members and U.S. Sen. Kyrsten Sinema from Arizona, who helped pass out refreshments and care for those on board while in flight.

“I’m honored to participate in this week’s hero’s welcome celebrating and thanking Arizona veterans for their service and sacrifice to our state and country. I’m grateful for Honor Flight Network’s and American’s efforts in honoring veterans and bringing them to our nation’s capital,” Sinema said.

On arrival at Baltimore-Washington Thurgood Marshall Airport, American team members provided a hero’s welcome — complete with a water cannon salute and cheering crowds — as participants deplaned for two days of activities.

Supporting future Honor Flight missions

The following day, Honor Flight Network leadership and volunteers; U.S. Senators Mark Kelly and Jerry Moran; U.S. Congressman Mark Takano; Deputy Secretary of Veterans Affairs Donald Remy; and former Senator Elizabeth Dole, gathered with the veterans at the World War II Memorial in Washington, D.C., to commemorate the program’s milestone achievement.

Honor Flight Network Board Chairman Matthew Shuman welcomes American leadership, elected officials, volunteers and veterans to an event at the World War II Memorial celebrating their historic milestone.

Honor Flight participants tour the monuments and memorials built in honor of their service and sacrifice.

Hundreds attend the May 3 event at the World War II Memorial to commemorate the Honor Flight Network’s milestone achievement.

“Since launching in 2005, the Honor Flight Network has carried more than a quarter-million veterans on flights to Washington, D.C. Nevertheless, there are still more than 50,000 veterans across the country with an expressed and time-sensitive desire to participate in a future mission,” said Matthew Shuman, Chairman of the Board for the Honor Flight Network.

To help the Honor Flight Network achieve its mission, American announced it will donate 15 million AAdvantage miles over three years to support and expand the reach of the program.

“The American Airlines team takes great pride in serving veterans on the many Honor Flights operated annually to our nation’s capital and in caring for all those who have and continue to serve in the U.S. military,” said Nate Gatten, Chief Government Affairs Officer for American. “It is our hope that such a contribution can help the Honor Flight Network fulfill its mission of celebrating America’s veterans, ensuring each experience the honor, gratitude and support they deserve.”

Celebrating Military Appreciation Month

Throughout May, American is celebrating the service and sacrifice of U.S. service members and their families through one-of-a-kind experiences across the country. Later this week, American will host Salute to the Troops in partnership with the USO — flying 20 service members battling cancer from Walter Reed Army Hospital in Bethesda, Maryland, to Walt Disney World with their families for a weekend of memories and fun. Then, in support of Seats for Sailors and Armed Forces Day, American will treat sailors from Naval Medical Center San Diego to a VIP experience with the Texas Rangers. American will also sponsor a similar experience at Rangers Stadium for Gold Star families from North Texas in commemoration of Memorial Day.

Top Copyright Photo: American Airlines Airbus A321-231 WL N167AN (msn 7013) (Medal of Honor) CLT (Jay Selman). Image: 404152.

American Airlines aircraft photo gallery (Airbus):

Frontier Airlines begins nonstop service between Miami and Kingston

Frontier Airlines on May began service between Miami International Airport (MIA) and Norman Manley International Airport in Kingston, Jamaica (KIN).

It marks the first time America’s Greenest Airline has offered service to the Jamaican capital. Flights will operate three times weekly year-round.

New Route from Miami International Airport (MIA)

SERVICE TO:

SERVICE START:

SERVICE FREQUENCY:

Kingston, Jamaica (KIN)

May 5, 2022

3x Weekly

Frequency and times are subject to change.

Frontier Airlines aircraft photo gallery:

Atlas Air Worldwide Holdings reports first quarter net income of $81.5 million

Atlas Air Worldwide Holdings, Inc. (Atlas Air) today announced first quarter 2022 net income of $81.5 million, or $2.38 per diluted share, compared with $89.9 million, or $3.05 per diluted share, in 2021 (which included $40.9 million, $31.9 million after tax, of CARES Act grant income).

On an adjusted basis, EBITDA totaled $202.8 million in the first quarter of 2022 compared with $181.3 million in the prior-year period. For the three months ended March 31, 2022, adjusted net income totaled $88.8 million, or $2.99 per diluted share, compared with $72.2 million, or $2.45 per diluted share, in 2021.

“We are off to an excellent start in 2022. We delivered strong earnings, despite the pandemic-related operational challenges we continue to navigate,” said Atlas Air Worldwide President and Chief Executive Officer John W. Dietrich. “I would like to thank the entire Atlas team for their ongoing commitment to deliver this great performance.”

He added: “Atlas continues to demonstrate the value of airfreight as a vital component of the global supply chain. We are seeing a sustaining shift in long-term customer demand for Atlas’ dedicated aircraft, and the speed and reliability airfreight provides. During the first quarter, our customers continued to enter and enhance long-term contracts with Atlas for dedicated freighter capacity.

“We are expanding and diversifying our customer base, and increasing flying under long-term contracts with attractive rates and guaranteed levels of flying. To meet customer demand, we are also investing in our world-class fleet by adding four new 747-8F and four new 777 freighter aircraft.

All four of our new 747-8Fs have been placed with customers under long-term contracts, and we have strong interest for the new 777Fs as well.”

Mr. Dietrich concluded: “We are very well positioned for the years ahead. We have significantly strengthened our balance sheet and have a healthy cash balance. This provides us the financial flexibility to opportunistically deploy capital, including investing in our business and returning capital to shareholders.”

First-Quarter Results

Revenue grew to $1.0 billion in the first quarter of 2022 compared with $861.3 million in the prior-year quarter. Volumes in the first quarter of 2022 totaled 82,626 block hours compared with 88,523 in the first quarter of 2021.

For the three months ended March 31, 2022, our reported net income totaled $81.5 million, or $2.38 per diluted share, compared with net income of $89.9 million, or $3.05 per diluted share, in the first quarter of 2021 (which included $40.9 million, $31.9 million after tax, of CARES Act grant income).

On an adjusted basis, EBITDA was $202.8 million in the first quarter this year compared with $181.3 million in the first quarter of 2021. Adjusted net income in the first quarter of 2022 totaled $88.8 million, or $2.99 per diluted share, compared with $72.2 million, or $2.45 per diluted share, in the prior-year period.

Reported earnings also included an effective income tax rate of 22.8%. On an adjusted basis, our results reflected an effective income tax rate of 22.3%.

Higher Airline Operations revenue primarily reflected an increase in the average rate per block hour, partially offset by a reduction in block hours. The higher average rate per block hour was primarily due to higher yields (net of fuel), including the impact of new and extended long-term contracts, as well as higher fuel prices. Block-hour volumes reflected a reduction in less profitable smaller gauge CMI service flying as well as operational disruptions due to the spike in Omicron cases globally.

Higher Airline Operations segment contribution in the first quarter of 2022 was primarily driven by higher yields (net of fuel), including the impact of new and extended long-term contracts. These improvements were partially offset by increased pilot costs related to our new collective bargaining agreement (CBA) and higher premium pay for pilots operating in certain areas significantly impacted by COVID-19.

In Dry Leasing, segment revenue and contribution increased from the prior-year period primarily due to $5.0 million of revenue received from maintenance payments related to the scheduled return of an aircraft, which was subsequently sold during the quarter. Dry Leasing contribution also benefited from lower interest expense related to the scheduled repayment of debt.

Unallocated income and expenses, net, increased during the quarter, primarily due to $40.9 million in CARES Act grant income recognized in 2021 (which was excluded from our adjusted results).

Share Repurchases

As previously announced in February 2022, our Board of Directors approved a share repurchase program authorizing up to $200.0 million of our common stock, which we began by entering into a $100.0 million accelerated share repurchase program (ASR). In total, we repurchased 1,234,144 shares under the ASR, which was completed in April.

Additional purchases may be made at our discretion in the form of open market repurchase programs, ASRs, privately negotiated transactions, or a combination of these methods.

Fleet

As previously disclosed, we are purchasing five of our existing 747-400Fs at the end of their leases during the course of this year, one of which was acquired in March. We expect to complete the remaining four aircraft acquisitions between May and December 2022.

Acquiring these widebody freighters underscores our confidence in the demand for international airfreight capacity, particularly in express, e-Commerce and fast-growing global markets. Keeping these aircraft in our fleet ensures continuity of capacity for our customers, which will drive strong returns for Atlas in the years ahead.

Cash

At March 31, 2022, our cash, including cash equivalents and restricted cash, totaled $740.9 million compared with $921.0 million at December 31, 2021.

The change in position resulted from cash used for investing and financing activities, including $115.0 million for pre-delivery payments for our new aircraft and $100.0 million for our ASR, partially offset by cash provided by operating activities.

Net cash used for investing activities during the first quarter of 2022 primarily related to payments for flight equipment and modifications, including aircraft pre-delivery payments, as well as capital expenditures and spare engines.

Net cash used for financing activities during the period primarily related to payments on debt obligations and the ASR.

2022 Outlook*

For the second quarter of 2022, we expect revenue to exceed $1.1 billion from flying more than 85,000 block hours. We also anticipate adjusted EBITDA of approximately $215.0 million, and adjusted net income to grow by a high-single-digit percentage compared with adjusted net income of $88.8 million in the first quarter of 2022.

For the full year, we expect to fly more than 350,000 block hours, with revenue of approximately $4.6 billion, and adjusted EBITDA of about $1.0 billion. In addition, we anticipate adjusted net income in the second half of 2022 to improve approximately 60% compared with adjusted net income in the first half of this year.

We expect aircraft maintenance expense in 2022 to be similar to 2021, and depreciation and amortization to total about $300 million. In addition, core capital expenditures, which exclude aircraft and engine purchases, are projected to total approximately $135 to $145 million, mainly for parts and components for our fleet.

We also expect our full-year 2022 adjusted effective tax rate will be approximately 23.0%.

This outlook includes the contribution from numerous new or enhanced long-term customer contracts, as well as higher pilot costs from our new CBA. We also expect second-quarter results to continue to be impacted by premium pay for pilots operating in certain locations significantly impacted by COVID-19.

Other than with regard to revenue, we provide guidance on an adjusted basis because we are unable to predict with reasonable certainty and without unreasonable effort the effects on future gains and losses on asset sales, special charges and other unanticipated items that could be material to our reported results.*

Atlas Air airfcraft photo gallery:

QANTAS to acquire Alliance Aviation (Alliance Airlines)

QANTAS Airways has made this announcement:

Qantas has reached an agreement to fully acquire Australian-based operator, Alliance Aviation Services Ltd (Alliance Airlines), enabling the national carrier to better serve the growing resources sector.

The agreement, which is subject to a vote from Alliance shareholders and competition clearance, would see Alliance become a wholly-owned part of the Qantas Group.[1]

There is no change to Qantas’ arrangements with Alliance as a result of today’s announcement given the approvals required, which would take a minimum of several months to secure.

Alliance has a fleet of 70 jet aircraft that seat up to 100 people each, making them well suited to charter operations. Between these charter services and a small number of passenger routes that overlap with large mine sites, Alliance accounts for around 2 per cent of the total domestic market.

The national carrier is Alliance’s biggest single customer, with a long-term agreement that sees Alliance operate up to 18 newly acquired E190 jets for QantasLink. This arrangement has helped open new direct routes and increase frequency across regional Australia.

Qantas bought just under 20 per cent of Alliance in February 2019 and at the time flagged its long-term interest in acquiring 100 per cent of the airline. The ACCC investigated that minority holding for three years and made no findings that it lessened competition.

Under the agreement announced today, the remaining 80 per cent would be acquired through a scheme of arrangement where Alliance shareholders receive Qantas shares worth $4.75[2] for each Alliance share they hold[3], representing a 32 per cent premium to Alliance’s volume weighted average price for the past three months. Qantas would issue new shares valued at approximately $614 million in a transaction that is expected to be EPS accretive for Qantas shareholders, before synergies.

Qantas has advised the ACCC of today’s announcement and provided detail of the anticipated benefits to customers. Qantas will continue to update the market on expected completion timing as the competition clearance and Alliance shareholder vote processes progress.

CEO Commentary

Qantas Group CEO Alan Joyce said acquiring the remaining shares in Alliance would mean QantasLink can better compete in the highly competitive charter segment, particularly given the shared fleet type of Fokker aircraft.

“Alliance’s fleet of Fokker aircraft are perfect for efficiently serving resources customers in WA and Queensland. They also have a big inventory of spare parts that would significantly extend the practical life of a combined fleet of around almost 70 Fokkers.

“Keeping these aircraft operating reliably for longer than either carrier could achieve by themselves will help keep costs down, which is ultimately good news for charter customers. There are also benefits from bringing together our operations planning and training facilities.

“The resources sector continues to grow and any new tender for airline services will be very competitive. It makes a lot of sense for us to combine with Alliance to improve the services we can offer, which is a positive for both airlines as well as the travelling public.

“We’ve opened up several new passenger routes using up to 18 of Alliance’s E190s, so bringing all 33 of these aircraft, plus their crews, into the Qantas Group would really expand what we could achieve.

“We plan to extend our program of guaranteed lower fares for residents in those few communities where Alliance operates its own passenger services, as well as access to our Frequent Flyer program,” added Mr Joyce.

[1] The agreement is a Scheme Implementation Deed, a copy of which is attached to the ASX announcement detailing the acquisition of same date by Alliance.

[2] The scheme consideration will be reduced by the amount of any dividends paid by Alliance in the ordinary course from now until completion of the acquisition.

[3] The number of Qantas shares received by Alliance shareholders will be determined using the volume weighted average price of Qantas shares in the 20 business days prior to the scheme record date (prior to transaction completion).

Alliance Airlines Route Map:

Alliance Airlines aircraft photo gallery:

Korean Air issues its tentative financial results for first quarter 2022

Korean Air issued this financial report:

Korean Air posted a revenue of KRW 2.8052 trillion (USD 2.3168 billion) and a record quarterly operating profit of KRW 788.4 billion (USD $651.1 million) in its first quarter financial results.
※ Previous quarterly operating profit record: Q4 2021, KRW 704.4 billion

Revenue from the airline’s passenger flight operations in the first quarter increased by 128% year-on-year to KRW 359.8 billion. Although passenger demand remained sluggish due to the spread of the COVID-19 Omicron variant, demand is gradually recovering as countries ease their entry restrictions one by one. On March 21, Korea lifted the mandatory quarantine for fully vaccinated travelers, helping to boost travel demand.

The airline’s cargo flight operations pulled in a revenue of KRW 2.1486 trillion in the first quarter. Uncertainties in the air cargo market persisted due to various external factors such as global supply chain bottlenecks, reduction in capacity on Europe routes and high fuel prices. Korean Air is taking preemptive measures to maintain its air cargo capacity through close management of ground handling operations and flexible network operations. The airline maximized its revenue through increasing freighter operation rates and using grounded passenger jets on cargo routes.

Korean Air’s passenger business is expected to quickly recover in 2022, as more countries continue to open up their borders and ease entry restrictions. The recovery of passenger demand will vary by route and region, and the airline will closely monitor and flexibly respond to the market and changing quarantine policies of its network.

Recovery in global passenger demand is foreseen to gradually boost global air cargo capacity, but instability in regional air cargo markets is expected to persist due to major Chinese city lockdowns and the war in Ukraine. Korean Air will tackle such uncertainties by actively responding to market changes through flexible operations and effective management of ground handling operations.

While the entire industry was suffering from COVID-19, Korean Air significantly improved its financial structure by reducing debt. At the end of 2019, the airline’s debt ratio was 814 percent, but as of the first quarter of 2022, the number decreased by 559 percentage points to 255 percent, the lowest debt ratio since 2011, when International Financial Reporting Standards (IFRS) were introduced. Moreover, Korean Air has secured over KRW 4 trillion worth of cash and cashable assets, enabling the airline to flexibly respond to various market uncertainties, such as increasing interest rates. Korean Air plans to maintain financial stability through profitable operations and by managing its debt ratio and liquidity.