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Airline profit expectations positive

Geneve - Airline profit expectations for the year ahead have become more positive, consistent with improvements in recent performance, according to the latest business confidence survey by the International Air Transport Association (Iata).

The survey contains feedback from airline chief financial officers and heads of cargo in January.

"Financial performance started to improve in the second half after no gains in the second quarter. The outlook remains positive, which suggests there will be further growth in profitability," Iata said on Monday.
 
The survey indicates that falling input costs and growth in volumes are responsible for better recent financial performance, as well as the positive outlook.

Respondents reported seeing a decline in input costs in the fourth quarter, largely due to a fall in crude oil prices over recent months. The trend is expected to continue during the year ahead.

Both passenger and cargo volumes were reported to have expanded during the fourth quarter, which is consistent with latest air traffic statistics.
 
There is also confidence that air transport volumes will continue to expand over the next 12 months, despite rising concerns about the health of the global economy.
 
Respondents continue to report declines in yields in both business, for the recent past and the coming year, potentially reflecting the expected decline in fuel-related costs.
 
Airline employment activity is reported to have been stable in the fourth quarter compared to a year ago, and no growth is expected for the year ahead. 

READ: Aviation industry highlights new threats

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