Finnair reported a first-quarter loss

Finnair reported a first-quarter loss of €18.6 million ($24.5 million), reversed from a €3.1 million profit in the year-ago period, as the potential for profitability has run into the sand due to feeble demand and a collapse in price levels, President and CEO Jukka Hienonen said.

Stating that the airline industry's first-quarter results make for sad reading, Hienonen said that while Finnair cut capacity, cost flexibility, particularly in scheduled passenger traffic, is poor. He added that the carrier will benefit this year from an increase in efficiency by retiring the last of its six MD-11s when it takes delivery of its fifth A330-300 by year end. The first A330-300 arrived in March. It said the A330s will be 20% more fuel efficient than the MD-11s.

The airline claimed that its aircraft financing for 2009 has been safeguarded and will support the A330 deliveries. It additionally said it will have the option of grounding seven 757s by year end when their leases expire.

First-quarter revenue fell 10.2% to €519.8 million while expenses declined 4.6% to €544.1 million, producing an operating loss of €24.3 million, reversed from an operating profit of €8.8 million last year. Traffic was flat at 5.62 billion RPKs on a 1.4% cut in capacity to 7.41 billion ASKs, producing a load factor of 75.9%, up 1.1 point.
Looking forward, Hienonen said Finnair will maintain its Asian strategy" of growing services between Europe and Asia, utilizing Helsinki as a. . .transit location. Its capacity for full-year 2009 will be down 8% compared to 2008. The second quarter will remain clearly loss-making, he conceded, adding that while forecasting full-year results is difficult, he expects a "negative" operating result for 2009, ATW Daily News reported.

Source: Transportweekly