Results for Quarter 1 of 2011: Austrian Airlines fights crises

Due to developments worldwide during the first quarter of 2011, the situation on markets has been significantly more difficult than expected at the beginning of the year also for Austrian Airlines. The crises in Japan and the Middle East are having a particularly noticeable negative impact on the result, as these crisis regions account for some 20 percent of the company’s Available Seat Kilometres (ASK). Austrian Airlines is expecting to see a clear market revival from the second quarter onwards, producing visible positive effects on results.

In the 1st Quarter, traditionally a relatively weak period in the aviation industry, Austrian Airlines achieved a result from operating activities of minus EUR 63.5 million, equivalent to a moderate improvement of 1.9 percent on the same period last year (Q1 2010: minus EUR 64.7 million). Total earnings from operating activities, at EUR 447.4 million, stood at practically the same level as the previous year (2010: EUR 448.4 million). EBITDA, at minus EUR 23 million euros, were exactly the same as for the equivalent period last year.

The Members of the Austrian Airlines Executive Board, Andreas Bierwirth and Peter Malanik, said the following: “The numerous crises currently playing out in some of our most important markets are having an impact on our performance. Due to the consistent programme of restructuring we have been implementing for the past eighteen months, however, we have succeeded in keeping our result stable at the same level as last year despite the crises. Our target remains unchanged: we want to achieve a positive operating result this year. Consequently, we are implementing a package of measures designed to ensure we achieve this goal.”

The package of measures consists of measures to adjust costs flexibly to market trends, and medium-term initiatives to further improve the costs structure of the company.

At the same time, Austrian Airlines is focussing more strongly on its customers, markets and on the competition, while making targeted investments in quality improvements. By September 2011, a total of 32 aircraft of the Airbus A320 family and the Boeing 737 type in the short- and medium-haul fleet of Austrian Airlines will have been converted to a new interior design with the new Europa seats. In the winter of 2012/2013, meanwhile, the ten aircraft of the company’s long-haul fleet will also be given a modern interior design with new seats.

The number of personnel at Austrian Airlines AG, including its fully-consolidated subsidiaries, stood at 6,943 employees on the reporting date of 31 March 2011, exactly the same figure as at 31 December 2010 (note: beginning with the first quarter of 2011, Austrian Airlines will account for its numbers of personnel in “employees”, rather than “full-time posts” as in the past, thereby adopting the Lufthansa reporting method).

Traffic figures
The number of passengers carried in the first quarter of 2011, at around 2.1 million in total, was 1 percent down on the figure for the same period the previous year. The load factor (passenger load factor) fell by 4.2 percentage points to 68.6 percent, since capacity measured in Available Seat Kilometres (ASK) was raised by 1.3 percent, while demand measured in Revenue Passenger Kilometres (RPK) fell by 4.5 percent.

In the scheduled service segment, the passenger number rose by 0.7 percent to more than 2 million passengers in the first quarter. In the Europe business segment, Austrian Airlines carried approximately 1.7 million passengers in the first quarter – 1 percent up on the figure for last year. The load factor rose by 0.5 percentage points to 63.7 percent. The figure for ASK fell by 0.2 percent, while that for RPK rose by 0.5 percent.

In the Intercontinental business segment, Austrian Airlines carried approximately 360,000 passengers in the first quarter. This is the equivalent of a fall of 0.7 percent compared to the previous year. The load factor fell by 8.7 percentage points to 72.3 percent. Austrian Airlines expanded its ASK by 9.6 percent. The figure for RPK fell by 2.2 percent.

As a result of the capacity restriction set by the EU, Austrian Airlines reduced its ASK by 47.4 percent in the charter business segment. The passenger number fell accordingly by 33,6 percent to 72,200. The load factor fell by 1.1 percentage points to 74.9 percent. The figure for RPK fell by 48.2 percent.

Punctuality
Austrian Airlines is amongst the most punctual airlines operating in Europe. In the months from January to February 2011 (more up-to-date comparison figures are not yet available) the company was once again amongst the leading players of 25 AEA airlines (Association of European Airlines): Austrian took second place in the departure punctuality category, and fifth place in arrival punctuality.