According to its half-year report, the airline saw its operating revenues rise significantly in the first half of 2023, compared to the same period in 2022 – while it was still in Covid recovery mode.
Introducing the results, Martin Gauss, President and CEO of the company said: “The exceptional results of the first half of this year have exceeded our expectations. We are doing well in terms of business, and the operating cash flow is at an all-time high. When we look back at the first six months of 2022 and even 2019, we have seen a significant growth – achieving the historically highest profit, record-breaking revenue, and an overall increase in the number of people flying with us.”
He later said that the results formed a "Good base for our ambitious target to list the company at the stock exchange in 2024."
However, the airline noted that challenges related to spare engine supply and engine reliability persisted, with an average of 12 aircraft grounded due to spare engine shortages, and due to Russia's war in Ukraine, the share of transfer passengers "is expected to remain significantly below the 2019 levels of 46% - in Q2 of 2023 the transfer share was 29%".
Today, we are excited to share our Q2 and H1 financial results, which highlight our achievement of the highest net profit in airBaltic history. We have also reached a remarkable surge in revenue, EBITDAR levels and operational excellence with a significant increase in flights and… pic.twitter.com/o9sHDAlp62
— airBaltic (@airBaltic) August 9, 2023
During the first six months of the year, passenger numbers were up 52% and the company's number of employees grew by 23% to reach 2,348.
Profits for the first half of 2023 were 14.6 million euros (as against a 91 million euro loss in the first half of 2022).
"As of August 1, following the coupon payment on the EUR 200 million Eurobond, the airline had cash balance of EUR 46 million as compared to EUR 65 million cash balance after the coupon payment in 2022. Though, the current cash balance is less by EUR 19 million than it was in 2022, the management believes that the financial performance during the first half of 2023 and the current trends indicate the airline's financial performance and cash generating ability to be significantly better than it was during the second half of 2022 and, therefore, it should be able to close the cash gap vs. 2022," the report says, adding that it is looking at "options to refinance EUR 200 million Eurobond which matures in July 2024" and "is currently considering the possibility of issuing a USD 300 million bond and using the proceeds to repay the EUR 200 million bond."
Also looking to the future, the management of the airline says: "Based on the H1 performance and the booking trends, the airline maintains its ambitious target of EUR 700 million in revenues for full 2023, however due to some softening in demand during the month of July, the probability that this target will be achieved has somewhat decreased compared to the expectations after the Q1 and therefore the updated revenue guidance is in the range from EUR 670 million to EUR 700 million."
airBaltic is 97.97% owned by the Latvian state.
The report is available online here.
