Finnair result improves third quarter 2002

Finnair's result improved during the third quarter, the result after financial items was 18.8 million euros, compared with a loss of 16.6 million euros a year earlier. Turnover grew by 2.4 per cent to 400.1 million euros.

"Finnair's result has clearly improved, despite the difficult conditions. Our recipe has been to adjust our operations quickly and successfully to altered conditions with respect to demand and to invest in our growth areas," says President and CEO Keijo Suila.

Unit revenues for passenger traffic grew by 1.8 per cent in the third quarter. Operating costs fell 1.1 per cent and unit costs by 2.3 per cent. Personnel costs fell by 5.7 per cent as a result of the cost cutting programme and restructuring. The growth in other operating costs was significantly influenced by higher security and insurance costs.

"A down-turn in consumer demand due to the world political and economic climate plus a tightening of the competitive environment will now require airlines to show flexibility and financial agility. Finnair's strong cash flow and low gearing ratio will provide good buffers as the uncertainty continues," explains Suila.

The third quarter result includes capital gains of 21.7 million euros. The most significant items are gains arising from the sale of IT and ground equipment operations. The gains from the restructuring of IT operations amount to 23.3 million euros, of which 14 million euros has been entered in the third quarter result and the rest periodized over 2003-2004.

In the first nine months of the current year, turnover fell to 1,210.4 million euros, representing a 3.3 per cent decrease on the corresponding period in 2001. Theresult before taxes, excluding capital gains, was more than twice that of the previous year's figure, and amounted to 19 million euros. In addition, capital gains totalled 22.9 million euros in the early part of the year. Operating costs fell during the period by 3.6 per cent and unit costs by 2.8 per cent. The operating result for 2002, excluding capital gains, is expected to be a profit and to be better than the previous year.