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Finnair Posts High June Load Factor Despite Airspace Closures
Finnair, Finland’s national air carrier, carried 997,200 passengers in June, 9.9% more than in June 2022 and 3.8% more than in May 2023. These are excellent results considering that there was one day less in June than in May. The negative impact of inflation and the closure of Russian airspace, particularly towards Asia, is still evident, even though those related to the COVID-19 pandemic have virtually vanished.
Finland’s national air carrier recently shared its full-year 2023 forecasts on June 13, which showed positive profit due to the anticipated increase in travel demand surpassing previous expectations. Also, thanks to the more-favorable-than-expected fuel price trend, the Finnish airline has readjusted its forecasts, estimating that the operating result will probably reach or even exceed the 2019 level; however, even if the 2023 revenues continue, Finnair still forecasts that they might not get the pre-COVID level of 3,097.7 million euros.
During June 2023, 82% of flights reached their destination on time. Finnair’s traffic, measured by Revenue Passenger Kilometers, increased by 16.4% year-on-year, while overall capacity, measured by Available Seat Kilometers, increased by 15.1% year-on-year. Additionally, there was a 0.9% increase in the Passenger Load Factor compared to the previous year.
While domestic traffic has only slightly increased compared to last year, there has been a significant rise in Asian traffic. This is due to the reopening of the Hong Kong route in July of last year and additional capacity to Japan and South Korea. Furthermore, the route to Mumbai opened in August, contributing to the increase in traffic.
During October 2022, traffic over the North Atlantic decreased due to disruptions in operations between Stockholm and North American destinations. However, European traffic has slightly increased, while there has been a significant rise in the Middle East, thanks to the collaboration between Finnair and Qatar Airways, which started in November 2022. This partnership has led to an increase in cargo operations. With the rise in Asian capacity, cargo operations have improved compared to last year, despite the reduced North Atlantic cargo capacity due to the disrupted operations between Sweden and the United States.
Available line-tonne kilometers increased by 36.7%, and revenue per tonne-kilometer of planned cargo increased by 24.0% year-on-year, representing a 28.3% increase in total tonnes of freight.
Finnair’s goal of achieving a strategic comparable operating profit margin of at least 5% by mid-2024 has been advanced by 12-18 months due to an improved profit outlook. Although the forecasts have improved, Finland’s national air carrier’s operating environment remains uncertain due to the high fuel prices and ongoing closure of Russian airspace.
Traffic statistics for July 2023 will be published on August 8 while the outlook and guidance for the full year 2023 will be posted on July 21, in the following half-yearly report.
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