Finnair’s comparable operating result was positive for the second consecutive quarter, and the net result was 53.3 million euros, turning positive driven by the weakening US dollar for the first time since the last quarter of 2019. This is yet another important step in the right direction, but the road towards profitability on an annual level is a long one, and full of challenges in the operating environment.
During the review period, Finnair carried 2.5 million passengers and our revenue was 687.3 million euros (413.5). Although strong demand continued to support our unit revenues, both passenger and revenue figures declined quarter-on-quarter due to seasonality. The comparable operating result was 17.9 million euros (-65.2), as our continued efforts to cut costs, improve sales and optimise profits produced the desired results.
Although the challenges of our operating environment continued in the form of high fuel prices, accelerating inflation, the remaining effects of the pandemic, as well as the Ukrainian war and closed Russian airspace, there were also positive developments. Of our key markets, Japan opened to travel, and China relaxed its zero covid policy in December, which makes it possible for Chinese travel to start gradually during 2023. The impacts of the pandemic are therefore fading, and we believe that the related travel restrictions will no longer affect our operations on any of the routes we operate after the summer. We also started our cooperation with Qatar Airways by launching daily flights between Copenhagen and Stockholm and Doha from the beginning of November, and between Helsinki and Doha from mid-December. Our cooperation will significantly increase the importance of the Middle East in our network, and it will also enable smooth transfers to numerous destinations in e.g., Africa and Asia.
The implementation of our strategy to restore profitability, announced in September, continued systematically throughout the organization, and the target is to reach a comparable EBIT level of at least 5 per cent starting from mid-2024. Considering on one hand the market developing more positively than previously anticipated, and on the other hand the continued strong cost inflation, we expect the strengthening of unit revenues to play a bigger role than we previously expected in achieving our targets. Despite the economic uncertainty and weak consumer confidence, people want to travel, and strong demand is expected to continue. At the same time, we continue to manage and cut costs in all our operations. During the period, we completed the change negotiations that resulted in a reduction of 150 jobs globally. As part of our sustainable balance sheet target, we also concluded an agreement to extend the pension premium loan until 2025. The extension maintains our cash funds in the still-challenging operating environment.
During the period, we also agreed on long-term savings with some personnel groups. After the period, we reached with our Finland-based cabin crew a negotiation result that now proceeds to an administrative handling.
Despite the winter conditions that started very early, our on-time performance remained on a good level. In addition to several won awards, our wide-body aircraft cabin renewal has received very positive feedback from our customers, which has contributed to our customer satisfaction. Finnair’s Net Promoter Score of 40 remained good. Further, we received five-star status from the Airline Passenger Experience Association (APEX) based on our customers’ ratings and feedback. Big thanks to the whole Finnair team for these achievements.
Finnair turns 100 years old this year. During this milestone year, our eyes are firmly on the future, and the work to restore Finnair’s profitability continues. Together with the Finnair team, we are building an even stronger company for the next hundred years.
Dividend policy and the Board’s proposal for the distribution of profit
The aim of Finnair’s dividend policy is to pay, on average, at least one-third of the earnings per share as a dividend over an economic cycle. The aim is to take into account the company’s earnings trend and outlook, financial situation and capital needs in the distribution of dividends.
In 2022, earnings per share were -0.36 euros (-0.34). Finnair Plc’s distributable equity amounted to -291,913,121.87 euros on 31 December 2022. The Board of Directors proposes to the Annual General Meeting that no dividend be distributed for 2022.
Financial reporting in 2023
The publication dates of Finnair’s financial reports in 2023 are the following:
- Interim Report for January – March 2023 on Thursday 27 April 2023
- Half-year Report for January – June 2023 on Friday 21 July 2023
- Interim Report for January – September 2023 on Tuesday 31 October 2023
