Saturday, 9 November 2019

Finnair's October traffic results

Strong traffic performance in October, passenger load factor increasing 2.8% year-on-year resulting in a record number of October passengers

In October, Finnair carried 1,266,000 passengers, 10.9% more than in the corresponding period of 2018. The overall capacity measured in Available Seat Kilometres (ASK) increased in October by 10.1%. Finnair's traffic measured in Revenue Passenger Kilometres (RPKs) increased by 14.1%, and the Passenger Load Factor (PLF) increased year-on-year by 2.8% points to 82.3%.  

Finnair’s long-haul capacity increased year-on-year with three new A350 aircraft that entered the service after the comparison period. The ASK growth in Asian traffic was 12.5%, mainly due to the doubling of frequencies to Hong Kong and increased frequencies to Osaka. The North American capacity increased by 27.5% following the opening of the new Los Angeles route in March.  

In European traffic, the ASKs were up by 5.4%. The growth derived from additional seating capacity in some of the existing narrow-body aircraft and the changes in the route network. The added capacity was directed especially to London and Brussels and to new destinations Hannover and Trondheim. Capacity in domestic traffic decreased by 2.2% mainly due to changes in the traffic plan.  

RPKs increased in Asian traffic by 14.7%, in North American traffic by 32.1%, in European traffic by 10.8% and in domestic traffic by 2.9%. The PLF was 82.8% in Asian traffic, 83.1% in North American traffic, particularly strong 82.5% in European traffic and 70.1% in domestic traffic.

Passenger numbers increased in Asian traffic by 14.3%, in North American traffic by 27.2%, in European traffic by 11.9% and in domestic traffic by 0.8%.

October resulted in record number of cargo tonnes in a single month and available scheduled cargo tonne-kilometres increased by 13.3% year-on-year. Revenue scheduled cargo tonne-kilometres increased by 6.2%. Global uncertainty in world trade continued to press global air freight market in October, and market softness and yield pressures were especially visible in Finnair’s cargo markets in Asia.

In October, 82.4% of all Finnair flights arrived on schedule (86.8%). 

Traffic statistics for November 2019 will be published on Thursday 5 December 2019.
Finnair Traffic Performance October 2019
Month% ChangeYTD% Change
Total traffic
Passengers 1,0001,266.010.912,412.810.2
Available seat kilometres mill4,054.110.139,654.811.4
Revenue passenger kilometres mill3,336.514.132,719.510.8
Passenger load factor %82.32.8p82.5-0.5p
Cargo tonnes total16,786.94.7144,615.611.5
Available tonne kilometres mill595.810.15,804.210.9
Revenue tonne-kilometres mill403.511.53,843.311.0
Passengers 1,000 Asia216.414.32,167.86.5
Available seat kilometres mill Asia1,982.012.519,543.210.7
Revenue passenger kilometres mill Asia1,640.214.716,393.16.7
Passenger load factor % Asia82.81.6p83.9-3.1p
Passengers 1,000 Europe825.311.97,938.912.8
Available seat kilometres mill Europe1,597.95.415,178.210.2
Revenue passenger kilometres mill Europe1,319.010.812,375.713.2
Passenger load factor % Europe82.54.1p81.52.2p
North Atlantic
Passengers 1,000 North Atlantic38.227.2389.326.5
Available seat kilometres mill North Atlantic345.127.53,401.428.6
Revenue passenger kilometres mill North Atlantic286.832.12,948.931.4
Passenger load factor % North Atlantic83.12.9p86.71.8p
Passengers 1,000 Domestic186.10.81,916.81.5
Available seat kilometres mill Domestic129.2-2.21,532.01.2
Revenue passenger kilometres mill Domestic90.52.91,001.81.6
Passenger load factor % Domestic70.13.5p65.40.3p
Cargo Traffic
Europe tonnes3,612.544.728,671.563.7
North Atlantic tonnes1,350.735.011,427.731.4
Asia tonnes11,775.31.7104,022.89.3
Domestic tonnes48.4-15.1493.66.1
Cargo scheduled traffic total tonnes16,786.910.9144,615.618.7
Cargo flights, tonnes**0000
Cargo Traffic tonnes total16,786.94.7144,615.611.5
Available tonne kilometres* mill163.112.11,572.715.3
Revenue tonne kilometres mill104.94.6914.811.6
Available sched.cargo tonne kms*, mill.163.113.31,572.716.6
Revenue sched.cargo tonne kms, mill.104.96.2914.813.4
Cargo load factor* %64.3-4.6p58.2-1.9p
- North-Atlantic cargo load factor* %59.9-3.1p56.34.7p
- Asia cargo load factor* %70.0-6.8p63.0-4.3p
Scheduled traffic Cargo load factor*, %64.3-4.3p58.2-1.7p
* Operational calculatory capacity

–       Change %: Change compared to the figures of the respective periods in the previous year (p = points).
–       Available seat kilometres. ASK: Total number of seats available. multiplied by the number of kilometres flown.
–       Revenue passenger kilometres. RPK: Number of revenue passengers carried. multiplied by kilometres flown.
–       Passenger load factor: Share of revenue passenger kilometres of available seat kilometres.
–       Available tonne-kilometres. ATK: Number of tonnes of capacity for carriage of passengers. cargo and mail. multiplied by kilometres flown.
–       Revenue tonne-kilometres. RTK: Total revenue load consisting of passengers. cargo and mail. multiplied by kilometres flown.
–       Overall load factor: Share of revenue tonne-kilometres of available tonne-kilometres. 
Following a period of accelerated growth, Finnair is now moving into a new phase. The company seeks to grow in line with the market, targeting sustainable and profitable growth.

Finnair’s Board of Directors has defined the following targets for the 2020-2025 strategy period:

Comparable EBIT of over 7.5% over the cycle (at constant fuel and currency), after a 12-18 month build-up period
ROCE of over 10% over the cycle (at constant fuel and currency), after a 12-18 month build-up period
On-time-performance of over 85%
Improved Net Promoter Score and improved employee Net promoter score
Finnair aims to deliver these targets through a focused strategy that leverages the geographical advantage of Finnair’s hub in connecting Europe and Asia.

During its Capital Markets Day on 12 November 2019, Finnair will elaborate on network and fleet optimization, operational excellence, retailing strategy and sustainability. Finnair’s management will also discuss its estimated investments for the strategy period and their potential financial implications.

Additional guidance for the 2020-2025 strategy period includes the following indicative items:

Capacity growth, measured in Available Seat Kilometres (ASK) of 3-5% CAGR
Optimize liquidity, yet keeping cash to sales ratio above 15% (34% as per 30 September 2019)
Gearing ratio 175% at maximum (74% as per 30 September 2019)
Assess renewal and downsizing of the hybrid bond
Increase the share of owned aircraft vs. leased aircraft
Keep the dividend policy unchanged
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