SAS has posted a loss for the first quarter of the financial year of almost €70 million but still expects a positive full-year result.
SAS suffered a pre-tax loss including non-recurring items of SEK 724 million (€68.66 million) for the first quarter of its financial year, SEK 339 million more than in the same quarter last year.
The airline blames the markedly poorer quarterly results on increased fuel costs, a weaker Swedish krone and underlying cost inflation, it writes in an announcement accompanying the figures.
The first quarter, which runs from November 1 to January 31, is traditionally a weak one in aviation and the size of the loss is, SAS says, on a par with expectations previously reported by the company.
“In the face of challenges, SAS is continuing its transition towards a viable and sustainable future,” chief executive Rickard Gustafson says optimistically.
“In view of the competitive market with ever-increasing capacity, we are pleased to report an increase in unit revenue.”
Unit revenue rose by 1.7% in the first quarter compared to the same quarter last year, while total revenues increased to SEK 9.53 billion from SEK 8.98 billion a year ago.
Competition and capacity
Despite continued weakness in the Swedish krone and uncertainty as a result of general economic and political tensions, SAS still expects to deliver a positive result before tax and non-recurring items for the 2018-19 financial year as a whole.
But competition in the market will still be tough, SAS warns.
“We note that competitors have lowered their expectations on the issue of capacity increases, which could lead to an improved supply-demand balance and price stabilisation. But we have not yet seen such a development in our main markets,” says Gustafson.