Finnair’s Struggles in Q1: Slower Turnover Growth and Increased Capacity in 2024
Finnair’s business faced challenges in the first quarter, leading the company to estimate slower turnover growth compared to capacity in 2024. Despite a decrease in the number of passengers and a lower passenger load factor, Finnair managed to reduce its unit cost of offered passenger kilometers. The interim CEO attributed this to strict expense monitoring and lower fuel prices.
Finnair reported an adjusted operating loss of EUR 11.6 million and a turnover of EUR 681.5 million in the first quarter, which was significantly lower than analysts had predicted an average adjusted operating loss of EUR 8 million with a turnover forecasted at EUR 698 million. This decline was due to political strikes in Finland, normalized revenue from unused tickets, and lower freight prices.
The company plans to increase its total capacity by about 10 percent in 2024, with a focus on expanding in Asia and Europe. However, Finnair expects turnover to grow slower than capacity in the coming year due to factors such as inflation, higher interest rates, international conflicts, and political instability that continue to pose uncertainty in the operating environment for the airline. Finnair will update its future outlook and guidelines in connection with its 2024 half-year report.
