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SWISS posts CHF 37 million EBIT for the first quarter of 2017

May 1, 2017 Financial No Comments Email Email

Swiss International Air Lines (SWISS) achieved earnings before interest and taxes (EBIT) of CHF 37 million for the first three months of 2017, a 67% improvement on the same period last year (Q1 2016: CHF 22 million). http://www.tourismlegal.com.au/Total first-quarter income from operating activities amounted to CHF 1.09 billion, a 2% increase on the prior-year period (Q1 2016: CHF 1.07 billion). The positive earnings trend is attributable to various factors including efficiency gains deriving from the current fleet renewal, along with the higher revenues generated by increases in both passenger numbers and cargo volumes. With market conditions remaining challenging, however, SWISS still expects to post an EBIT for 2017 as a whole that is slightly below its 2016 level.

Despite a still-challenging market environment, SWISS achieved earnings before interest and taxes (EBIT) for the first three months of 2017 that were a tangible improvement on the same period last year. The first-quarter EBIT of CHF 37 million was 67% up on the CHF 22 million of January-to-March 2016. Total income from operating activities for the period was also up 2% at CHF 1.09 billion (Q1 2016: CHF 1.07 billion). The favourable first-quarter earnings result reflects substantial efficiency gains deriving from the current fleet renewal programme. On the long-haul front SWISS has introduced the Boeing 777-300ER to replace some of its Airbus A340-300s, and now has eight Triple Sevens in service. And for its short- and medium-haul routes the carrier took its first deliveries of the advanced new Bombardier C Series twinjet last year, and now has seven of the type in service. SWISS’s first-quarter earnings result was further buoyed by the higher revenues deriving from increases in both passenger numbers and cargo volumes. By optimizing its capacity management, SWISS raised its systemwide first-quarter seat load factor to 77.6%, a year-on-year improvement of 1.7 percentage points. This also means that the higher capacities offered through the current fleet renewal were fully absorbed by market demand.

“SWISS has taken off very well into the new year,” says CEO Thomas Klühr, “despite the fact that the first quarter is a traditionally weaker period in business terms. These positive quarterly results are attributable primarily to the impact of our investments in our aircraft fleet. We are well aware, though, that with the tough competition we face in our markets we cannot ease up in our efforts. So we will continue to invest intensively in our premium product throughout the months ahead, both in the air and on the ground.”


Despite SWISS’s successful takeoff into 2017, the market environment remains a challenging one. The strength of the Swiss franc and an expected increase in oil prices are both likely to impact adversely on earnings results. And SWISS still expects to post an EBIT for 2017 as a whole that is slightly below its prior-year level. The annual EBIT result will also be reduced by the loss of the earnings from Swiss AviationTraining, which was merged with Lufthansa Flight Training to create the new Lufthansa Aviation Training in 2016.

Further investments in the ground and inflight products

SWISS will continue to invest in its premium product in the air and on the ground. Plans here include a new First Class Lounge with its own security checkpoint for Zurich Airport, along with the modernization of the existing top-customer lounges in the airport’s Terminal A.

SWISS also stationed its first Bombardier CS100 in Geneva in March of this year; and the first CS300 delivered will be put into Geneva-based service in May. SWISS will have eight Bombardier C Series aircraft – one CS100 and seven CS300s – stationed in Geneva by the end of 2018, making its Geneva operations an all-C Series affair. The airline has also exercised its option to convert its last five CS100 orders into the bigger CS300. As a result, the final SWISS Bombardier C Series fleet will consist of ten CS100s and twenty CS300s.

On the long-haul front, SWISS will take delivery of two further Boeing 777-300ERs in 2018. Next year will also see the carrier refurbish its five remaining Airbus A340-300s, providing them with a new cabin product in all three seating classes.

This media release will be found at www.swiss.com/media

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