Finnair (FIA1S) Q3 2021 earnings summary

Executive summary

• Q3 revenue rose 104.7% YoY to €199.4M; comparable operating loss narrowed to €109.1M, while net loss was €115.1M.

• Operating cash flow turned positive at €27.1M for the first time since Q4 2019, supported by improving bookings and strong cargo demand.

• European leisure travel and bookings improved, with the schedule averaging ~130 flights daily; passenger demand remained limited, particularly in Asia.

• Cargo demand remained exceptionally strong amid global supply-chain disruption, while cargo accounted for one-third of revenue.

Financial highlights

• Q3 revenue was €199.4M (+104.7% YoY); comparable EBITDA was -€30.7M vs -€81.9M, and reported operating loss was €106.0M vs €183.1M.

• Net loss was €115.1M vs €199.5M; basic and diluted EPS were -€0.08 vs -€0.15.

• 9M revenue fell 41.6% to €424.9M; comparable operating loss was €403.6M vs €432.4M and net loss was €380.7M vs €514.2M.

• Operating expenses were €318.1M as capacity grew 97.6%; 9M operating cash flow was -€149.8M vs -€864.5M.

Outlook and guidance

• Q4 comparable operating loss was expected in the same range as Q3 despite gradual revenue growth; operating cash flow was expected to remain positive.

• Comparable operating result was expected to remain loss-making through H1 2022; 2019 ASK levels were forecast for 2023.

• Asia was expected to reopen more significantly in early 2022, excluding China, where restrictions were expected beyond H1; H2 2022 conditions were expected to move closer to pre-pandemic levels.

• Permanent annual cost savings target was ~€200M from 2022 at 2019 operating volumes; capacity growth target was ~3% annually. Updated financial targets awaited better visibility on Asia’s reopening.