New Record Loss at AUA
Bad news for Austrian Airlines: the result from operating activities reaches € -66.7m. AUA refers to higher kerosene prices and the air travel tax. Nevertheless, the turnaround should be reached in 2013.
In the first quarter of 2012, Austrian Airlines generated a result from operating activities of minus € 66.7m, a decline of five percent from the previous year (Q1 2011: minus € 63.5m). The total operating income amounted to € 464.3m, a rise of 3.8 percent from the prior-year (Q1 2011: € 447.4m). EBITA totaled minus € 26.9m, a drop of 19.2 percent from same period in 2011 (Q1 2011: minus € 22.5m).
“The operating loss can be attributed to the increased fuel prices and the burden of increased taxes and fees.” AUA explains. The costs for fuel and fees, which comprise some 50 percent of the company’s total operating costs, were € 257m in the first quarter of 2012, a rise of € 28m than in the prior-year quarter.
Even AUA´s holding company Lufthansa slid into the loss area. Operating losses of € 381m were recorded, which is substantially more than in the first quarter of 2011 (€ -169m). The negative net income reached € 397m. Revenues were up by 6% to € 6.6bn. Also Lufthansa suffers from high kerosene prices. As a result, Lufthansa announced further layoffs. Personnel costs should be reduced by 5.0%. Nevertheless, Lufthansa anticipates to achieve profits in 2012.
“In particular, the air travel tax, which was introduced on April 1, 2011, negatively impacts our business in a completely new manner and with full intensity”, says Austrian Airlines CEO Jaan Albrecht, commenting on the results. “We cannot fully pass on the fees to customers due to the tough competition. Therefore I appeal to the Federal Ministry of Finance once again to do everything in its power to relieve the burden on the Austrian air traffic hub”, CEO Albrecht adds.
At the same time, passenger numbers reached an historic all-time high in the first quarter of 2012. A total of 2.3m passengers were carried by Austrian Airlines in the first three months, representing an increase of 10.1 percent. “This gives rise to the hope that capacity utilization will be good in the year 2012. A clear trend is evident by looking at advance bookings.” The airline said. In terms of available seat kilometers (ASK), Austrian Airlines expanded its offering by 6.4 percent in the first quarter, thus increasing the passenger load factor to 70.6 percent. This corresponds to an improvement of 2.1 percentage points.
The unfavorable results on the one hand and the increasing passenger numbers on the other hand present the following picture”, says Austrian Airlines CEO Jaan Albrecht. “First, our costs are too high. This confirms that the countermeasures we have initiated within the framework of the Work Programme are important and urgently needed. Second, more passengers are flying with Austrian Airlines. Considering both these factors, one can see that we have a good basis for future growth”, Albrecht continues.
At the reporting date of March 31, 2012, the number of staff employed by Austrian Airlines was 6,774 people, down 2.4 percent from the previous year (March 31, 2011: 6,943 employees). The initial positive effects of the Work Programme will first be perceptible as of the second quarter of 2012. However, one-off restructuring measures could lead the result in operating activities for the year 2012 as a whole to be below the comparable performance in 2011.”We first see reaching the break-even point in 2013”. CEO Jan Albrecht concludes.