For January – June 2024 Finnair's passenger numbers increased by 1.9% to 5.5 million, load factor decreased to 73.5%. Net cash flow from operating activities was €312.0 million, and net cash flow from investing activities was -67.5 million euros.
Global air traffic is expected to continue growing in 2024, but for Finnair, the risks related to the impact of inflation and higher interest rates on demand and costs remain elevated, causing uncertainty in the operating environment. International conflicts and global political instability also cause uncertainty in the operating environment. These factors may affect the demand for air travel and cargo the carrier warned.
Finnair plans to increase its total capacity, measured by ASKs, by c. 10 per cent in 2024. The capacity estimate includes the agreed wet leases. This growth will mainly focus on Asia and Europe. Finnair’s revenue is expected to grow more slowly than capacity in 2024. It estimates that its revenue in 2024 will be within the range of 3.0–3.2 billion euros and the company also estimates that its comparable EBIT will be within the range of 110–180 million euros in 2024.
CEO Turkka Kuusisto explained: "We carried 3.0 million passengers in April–June and revenue for the period increased by 2.3 per cent driven by higher ancillary and cargo revenue. Comparable operating result amounted to 43.6 million euros (66.2). The decrease was caused by lower yields and passenger load factor in the quarter. Our operating cash flow remained strong and financial position improved supported by refinancing actions during the quarter.
Runway renovation at Helsinki Airport in April–June impacted negatively our on-time performance and increased costs in the form of re-routing customers to their connecting flights. Our on-time performance was 76.0 per cent (84.9). On-time performance was also affected by challenging weather conditions that delayed flights and increased our costs.
Pent-up demand after the COVID-19 pandemic has largely been released and consumer confidence has been low for a long time. These are now being reflected also in travel demand, which is normalising after a period of strong demand during 2023. Based on the strong demand in 2023, we increased our Available Seat Kilometres (ASK) for 2024 by improving aircraft utilisation and by deploying aircraft that returned from British Airways wet lease outs into our own use. As travel demand is normalising, the capacity increase has not yet increased our revenues accordingly, and our passenger load factor was 74.7 per cent (76.3). Continuous capacity optimisation is a normal part of traffic planning and we continue to work every day to optimise our network and schedules."
Turkka Kuusisto continued: "We successfully completed the rollout of our new long-haul cabins. This project included the launch of an entirely new Business class seat, introduction of a brand-new Premium Economy travel class, and a refreshed Economy class. After the renewal, we can offer a consistent onboard experience on our long-haul routes. Finnair’s Net Promoter Score (NPS) measuring customer satisfaction was at 39, and air travellers voted Finnair the best airline in Northern Europe at the Skytrax World Airline Awards, for the 14th time in a row. We are grateful to our customers for this recognition. Our investments in customer experience continued as our new, larger Schengen lounge was opened at Helsinki Airport in July.
Based on my first months as Finnair CEO, I can state that after the heavily loss-making pandemic years, Finnair’s team has made right choices in order to increase revenues and manage costs to restore the company’s profitability and take advantage of the opportunities offered by the market. However, as 2023 was exceptionally strong for air travel, and travel demand is now normalising, it is clear that we need to continue our systematic efforts to improve productivity."
"During the period, we continued to strengthen our balance sheet by issuing a 500-million-euro unsecured senior bond to refinance our 400-million-euro bond, among other things. S&P Global Ratings assigned a long-term issuer credit rating of BB+ to Finnair Plc. This is the first credit rating for Finnair, enabling deeper funding sources from the debt capital markets and increasing the execution certainty of financing transactions as demonstrated by the successful bond issue.
Systematic work towards our long-term financial targets continues. Our priorities are now to continuously improve competitiveness and profitability, as well as to take care of our cash flow and balance sheet, without forgetting growth. As part of this, we continue our efforts to continuously improve customer experience by utilising data and customer understanding.
During my first months with the company, I have met hundreds of Finnair employees and committed and competent personnel are our absolute strength, and they are in a key role in achieving our targets. Working together, we take care of customers, flight safety and punctual operations every day. I would like to thank all our employees for their committed work. A warm thank you also to all our customers who trust us with implementation of their important travel plans."
