DALLAS — TAP Air Portugal (TP) achieved its highest-ever third-quarter revenues of €1.1bn in 3Q22, surpassing pre-pandemic levels by 7.5%.
According to the Portuguese airline, the positive results are due to improved load factors and higher yields, allowing TP to record financial performance with recurrent EBITDA of €280.1m and recurrent EBIT of €152.7m, both above pre-crisis levels despite higher fuel costs.
TAP achieved a positive net income of €111.3m as a result of these indicators, owing to strong operating results and positive effects from the implementation of the currency hedging policy.
The airline also reported a solid liquidity position of €775.1m, down €114.8m from the end of June, reflecting the industry’s normal cash-consuming seasonal pattern.
Additionally, the number of transported passengers more than doubled in 3Q22 compared to the same period in 2021, reaching 85% of 3Q19 levels. while operating 1.5 times as many flights in the third quarter of 2021, or 81% of 3Q19 departures.
Further, capacity (measured in ASK) increased by 1.7x compared to 3Q21, and the Load Factor improved by 20.3 percentage points year on year, reaching 87.0%. In 3Q19, ASKs were 88% and Load Factor was 105% of pre-crisis levels.
Finally, operating revenues were 2.5x higher than in the same period last year, increasing by €675.3m to EUR 1,118.9m, representing 107% of 3Q19 operating revenues.
Comments from TAP CEO
Christine Ourmières-Widener, TP’s Chief Executive Officer, said, “TAP is confirming its strong performance in the third quarter with all financial metrics above pre-crisis level, despite further increased fuel costs. Demand for Q4 remains very strong, guiding the expectation for a strong full-year result. Visibility for next year is however still low and given the uncertain environment it is ever more crucial to focus on our strategic plan which has proven is effectiveness so far.”
The CEO added, “Major next steps are: productive discussions with our labor partners for modern CLAs, improvement of our operations and our quality of service with the involvement of all stakeholders, relentless negotiations of all our contracts, and thorough preparation for next year.”
The CEO did not comment on recent news of a possible merger in 2023. This year, the Portuguese government started looking for an industry backer for its flag carrier, which it rescued during the COVID-19 pandemic with €2.55bn (US$2.55bn) in aid. Last week, Air France-KLM said it was interested in taking a stake in TP. At the group’s Q3 press conference, Chief Executive Officer Ben Smith stated that TP might be an “option.”
On October 19, Portuguese Infrastructure Minister Pedro Nuno Santos said that TP needed to merge with a “large aviation group” in order to continue operations with a net loss of €1.6bn (US$1.5bn) in 2021.
Will the uptick in the uptick in revenues change the Portuguese government’s perception of the flag carrier? Be sure to leave your comments on our social media channels!
Featured image: TAP Air Portugal CS-TNX Airbus A319. Photo: Arturo La Roche/Airways
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