Finnair - Ugly Q2, as expected
Finnair’s Q2’20 adj. EBIT was EUR -174m vs. our expectation of EUR -177m and consensus of EUR -179m. Revenue decreased by 91% and was EUR 69m vs. our expectation of EUR 54m and consensus of EUR 49m.
- Q2 revenue was EUR 69m vs. EUR 54m/49m Evli/cons.
- ASK decreased by 97.2% y/y in Q2. PLF was 33.1% (-49.4 points).
- Q2 adj. EBIT was EUR -174m vs. EUR -177m/-179m Evli/cons. Q2 comparable EBITDA was EUR -89m vs. EUR -91m our view.
- Absolute costs in Q2: Fuel costs were EUR 33m vs. EUR 14m our view. Staff costs were EUR 48m vs. EUR 37m our view. All other OPEX+D&A combined were EUR 173m vs. EUR 180m our view.
- Unit costs: CASK was 70.5 eurocents vs. 67.1 eurocents our view.
- Q2 EPS was EUR -0.25 vs. EUR -0.12/-0.12 Evli/cons.
- In Q3, Finnair gradually increases its capacity and will operate ~25% of flights in July compared to the same period in 2019. Based on the current assumption, the share of flights operated increases to ~50% in September. There are uncertainties relating to COVID-19 development and lifting of travel restrictions. As a result, the outlook remains unclear and the company does not provide revenue guidance for Q3.
- Finnair reiterates its previous guidance and states that the revenue will decrease significantly in 2020 compared to 2019 and that the comparable operating loss will be significant in the financial year 2020. In addition, Finnair's capacity will decrease significantly this year compared to 2019.