Seventy per cent of Finnair's earnings driven by air cargo in Q2
FINNAIR Group's revenue in the first half of 2020 was mainly driven by cargo-only operations, as Covid-19 pandemic grounded the airline's passenger operations to a near halt
FINNAIR Group's revenue in the first half of 2020 was mainly driven by cargo-only operations, as Covid-19 pandemic grounded the airline's passenger operations to a near halt. The group stated that its cash position and equity were restored to pre-pandemic level.
In the second quarter, Finnair recorded a massive drop in revenue, which was down by 91.3 per cent compared to the same period last year. The total drop in the group's revenue in the first half of the year stooped down by 56.8 per cent compared to the same period last year.
'The demand for cargo-only flights remained high throughout the quarter and we flew 602 one-way cargo flights, mainly between Finland and Asia. Cargo exceptionally accounted for over 70 per cent of our revenue for the quarter, and its profitability remained at a good level. The cargo traffic also had a profound social impact as the cargo we transported included personal protective equipment used in managing the pandemic and in ensuring security of supply. Otherwise our result reflected a near-complete halt to our traffic,' said Topi Manner, CEO of Finnair.
The number of passengers decreased by 61.0 per cent to 2.8 million in the first half of the year, and Finnair estimates that the recovery of air traffic will begin in stages from the beginning of July 2020. However, the pace of recovery cannot be assessed at this stage, leaving the outlook for the second half of 2020 unclear. Finnair is preparing for the future with different scenarios to have the ability to quickly adapt its capacity to changing demands, reports Mumbai's The STAT Trade Times.
'We have also continued implementing our cost reduction programme. As communicated in May, we target a permanent annual cost reduction of nearly EUR80 million (US$93.9 million) from the beginning of 2022, compared to 2019. We seek savings from, among others, real estate costs, aircraft leases, salary and incentive structures, sales and distribution costs as well as IT and administrative costs,' Mr Manner said.