Finnair records negative result in Q1 - volcanic ash cloud will further complicate things for Q2

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Finnair’s result before taxes for January-March 2010 was a loss of EUR 29 million, compared with a loss of EUR 25 million for the first quarter a year ago.
      The company’s net sales fell in Q1/2010 by 6.6 per cent from a year ago to EUR 481.5 million.
     
In Q1/2010, the Finnair Group's operational result showed a loss of EUR 26.3 million, against a loss of EUR 47.5 million a year earlier. The operational result refers to the business result without non-recurring items, capital gains, and changes in the fair value of derivatives.
      The loss per share grew from 0.15 to 0.19 euros.
     
The ash cloud from Iceland will cause further havoc to Finnair’s Q2 result. Disruptions to air traffic plus additional costs are expected to eat away EUR 20 million from potential profits. The company suspects that the recovery in demand will take weeks.
     
According to Finnair President and CEO Mika Vehviläinen in a statement accompanying the report: "In terms of scheduled traffic, the year began with a slight rise in demand. In March, demand rose by 20 per cent from the previous year. Unit revenue still declined, but during the quarter the trend was positive. In March, turnover in the Airline Business segment rose for the first time since the beginning of the economic downturn."
      "We have just come through a significant crisis situation, so it is difficult to estimate how quickly we will return to a growth track. Before the stoppage of air traffic, the signs were encouraging, however. We expect our profitability to improve towards the end of the year", added Vehviläinen.


Previously in HS International Edition:
  Finnair and passengers wrangle over compensation for ash delays (27.4.2010)

Links:
  Finnair Plc press release, 28.4.2010
  Finnair Company Announcement on ash cloud losses and state support for airlines, 23.4.2010
  Finnair PLC Interim Report Q1/2010

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