Türk Hava Yollari Anonim Ortakligi (THYAO) Q4 2024 earnings summary

Executive summary

• Full-year revenue exceeded $22.7 billion, with net profit reaching $3.4 billion, reflecting strong operational resilience, disciplined capital allocation, and industry-leading ROIC.

• Passenger capacity rose by 8.2% year-over-year, surpassing pre-pandemic levels by 35%, with international passenger numbers and capacity materially above 2019.

• Cargo volume increased by over 20%, with cargo revenue surging 35% year-over-year, making the company the world's third-largest air cargo carrier and raising its market share to 5.7%.

• Expansion into new markets included Melbourne, Sydney, Denver, Torino, and Santiago, increasing served countries to 131 and international destinations to 299.

• Awards included Guinness World Record for most countries flown, Best Airline in Europe (Skytrax), Most Sustainable Flag Carrier Airline (World Finance), and other sustainability and service quality recognitions.

Financial highlights

• Total revenues climbed by 8% to $22.7 billion, with passenger revenue up 4% and cargo revenue up 35% compared to 2023.

• Net income for 2024 was $3.4 billion, with a net income margin of 15.1%; profit from main operations declined 16% due to cost pressures.

• EBITDA/EBITDAR margin reached 25%/25.3%, with free cash flow generation since 2021 totaling $13.5 billion and liquidity at $7.2 billion.

• Net debt improved by over 20%, falling to $5.7 billion, and leverage dropped to 1.1x, down from 9.5x at the pandemic peak.

• Dividend payout of $260 million (7.6% ratio) proposed, marking the first distribution since 2013, with a yield of 2.4%.

Outlook and guidance

• 2025 guidance targets 6%-8% increases in both passenger capacity and total revenues, with over 91 million passengers expected and flat yields.

• EBITDA/EBITDAR margin guidance of 22%-24%; ex-fuel unit costs expected to rise mid-single digits.

• Net debt to EBITDA ratio projected at 1.1-1.3x, with gross CAPEX of $4.5 billion, 70% financed.

• Free cash flow margin expected to run at 8%-12%.

• Dividend policy aims for sustainable payouts and potential share buybacks.