Finnair (FIA1S) Q4 2021 earnings summary

Executive summary

• Passenger travel recovered month by month, with ~200 daily flights; Q4 revenue rose 305.5% YoY to €413.5m and comparable EBITDA turned positive for the first time since Q4 2019, though the quarter remained loss-making.

• The €200m cost-saving target was achieved; cargo posted record revenue amid global supply-chain disruption.

• Recovery remained constrained by COVID-19 and Asia travel restrictions; unusually strong cargo demand partly offset weak passenger traffic.

Financial highlights

• Q4 revenue was €413.5m vs €102.0m; comparable EBITDA was €12.6m vs -€71.7m, comparable operating loss was €65.2m vs €162.9m, and reported operating loss was €60.2m.

• Q4 net loss was €83.7m vs €9.1m; loss before tax was €104.8m vs €11.7m, and EPS was -€0.06.

• FY revenue was €838.4m vs €829.2m; comparable EBITDA was -€149.0m vs -€251.5m, adjusted operating loss was €468.9m, and net loss was €464.3m vs €523.2m.

• FY reported operating loss was €454.4m; EPS was -€0.34. Operating expenses excluding depreciation and impairments fell to €1,027m from €1,129m.

• FY cargo revenue rose 88.3% to €334.7m; passenger revenue fell 20.3% to €420.8m and travel-services revenue fell 36.7% to €38.7m.

Outlook and guidance

• Omicron is expected to weaken revenue and raise costs significantly but temporarily in Q1 2022 vs Q4 2021; adjusted operating loss is forecast at a similar magnitude to Q1 2021, with losses continuing through H1.

• Asian markets, except China and Hong Kong, are expected to reopen gradually toward end-Q2; reopening timing in China and Hong Kong remains highly uncertain.

• Excluding China and Hong Kong, H2 2022 is expected to be closer to pre-pandemic conditions; 2019 capacity, measured in available seat kilometres, is expected in 2023.

• Summer plans included strong capacity to Europe, the US and open Asian markets, plus Dallas, Seattle, Busan and Tokyo Haneda routes; cargo demand was expected to remain strong through at least H1 2022.