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IATA Reports Airlines Making Profits, Despite Tough Times
January 6, 2012

Airline share prices are falling to levels not seen since 2009, but their profits are good, according to the International Air Transport Association’s November-December Airline Financial Monitor. What has helped is the fact that despite weak passenger travel in November, load factors were solid. Airlines are seeing some relief from jet fuel prices, but the market is still above last year.

Although airline profits have declined over the past year, airlines did “quite well” in the third quarter, said IATA, with a sample of 61 carriers reporting $5 billion in net profits.

While operating profits were down over the year, the decline was contained to 20 percent. Regions such as Europe, with weak economic performance, limited their third-quarter profit contraction to 5 percent, year-on-year.

But the outlook for airlines remains tough. While jet fuel prices are down from March 2011, they’re still up over 2010. Passenger load factors remained flat when compared to October 2011.

However, careful capacity management -- which U.S. airlines are doing particularly well at -- are helping improve yields. Average international fares also show improved yields, and are now over 8 percent higher than in November 2010.

These fare levels have helped to cover costs, such as fuel, and have contributed to the reasonable profit results in the third quarter.

Source :- http://www.travelpulse.com/
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