Airlines enjoy robust Q2

August 24, 2017 by  
Filed under Aviation, News

SINGAPORE, 24 August 2017: IATA reports more robust results for airlines during the second quarter of 2017.

Initial airline financial results outlined in IATA’s July Financial Monitor show Q2 2017 turned out better for airlines, suggesting the squeeze on profit margins from higher costs and weak yields peaked in the first quarter of the year.

IATA noted that  passenger yields, having trended downwards since 2013, have now started to trend upwards.

Exchange rate-adjusted yields were broadly unchanged from their year-ago level in May.

Global airline share prices fell in July, driven by a decline in the North America index. Having seen airline shares outperform global equities over the past year, July’s decline appears, in part, to reflect profit taking by investors.

Brent crude oil prices came back to US$50/bbl in July, and ended the month nearly 10% higher than they started it.

However, IATA said the futures market remains consistent with just a modest increase in prices over the medium term.

Passenger and freight demand growth posted their strongest first half of the year since 2005 and 2010 respectively.

The season-adjusted passenger load factor remained broadly stable close to an all-time high over the same period, while the freight load factor recovered to its highest level in more than two and a half years.

The pick-up in global trade, however, is helping to support premium passenger demand, particularly to, from and within Asia Pacific.

Premium revenues have risen in year-on-year terms on key routes to and from the region so far in 2017.

Global passenger volumes grew by 7.9% year-on- year in the first half of 2017 – the fastest growth seen in the first half of a year since 2005.

The strong start to the year for passenger demand has been driven by a brighter global economic backdrop and stimulus from lower airfares.

That said, the season-adjusted trend has moderated over recent months, in line with a softening in the exceptionally supportive demand conditions.

(SOURCE: IATA)

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