Release Date: October 29, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Passenger numbers increased by 9%, aligning with capacity growth.
- Ancillary revenue grew by 26% and cargo revenue by 29%, driven by e-commerce shipments.
- Financial expenses reduced by 10 million EURO, improving the bottom line compared to Q3 2023.
- Operative cash flow increased by 4 million EURO, aiding in bond buybacks and improving financial stability.
- Successful refocusing of route network and fleet redeployment, enhancing revenue management and yield optimization.
Negative Points
- Comparable EBIT fell short of the previous year's strong performance due to lower unit revenue.
- Ticket prices decreased by 9%, leading to a decline in passenger revenue.
- Passenger load factors decreased, particularly in European and domestic routes.
- On-time performance decreased to 77% due to airspace and air traffic control capacity restrictions in Europe.
- Yield normalization and competitive pressures are expected to impact future quarters.
Q & A Highlights
Q: Can you explain the significant increase in ticket liabilities and its impact on Q4 passenger revenue?
A: Our unflown ticket liability is currently 20% higher than last year, indicating a potentially more active winter quarter ahead. This increase is partly due to a longer booking curve, but we have also observed a trend towards closer bookings starting from mid-September. - Turkka Kuusisto, CEO
Q: What is the outlook for yields in Q4 compared to the previous year?
A: Last year, Q4 saw market normalization, making the comparison period easier for this year. While yield normalization will impact Q4, the comparison point is now more favorable. - Kristian Pullola, CFO
Q: How do you view the competitive landscape for 2025, particularly with Norwegian increasing capacity?
A: We are aware of the competitive indications, but our focus remains on actions that impact our business, such as following consumer trends and adjusting capacity where demand is high. We are confident in our ability to remain a strong market player using Helsinki as a hub. - Kristian Pullola, CFO
Q: What are the cost pressures anticipated for 2025, excluding fuel costs?
A: Regulatory costs have been increasing, and there is ongoing dialogue with employees regarding compensation expectations. However, we are focused on driving productivity improvements to offset these pressures. Inflation has decreased, reducing cost pressures from suppliers. - Kristian Pullola, CFO
Q: Can you provide insights into passenger load factors in Europe for Q4?
A: The comparison for Q4 will be easier, and current bookings look better than they did a year ago. This suggests potential improvement in load factors for the upcoming quarter. - Turkka Kuusisto, CEO
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
