Finnair earnings deteriorate as restructuring efforts ramp up

Finnair’s earnings fell in its seasonally strong third quarter due to a combination of cost blowouts and deteriorating economic conditions in key markets. A gloomy outlook for the remainder of the year accompanied the weaker result, which is expected to leave the airline in the red for the full-year. Sharp cost increases in 2011 have brought into focus Finnair’s urgent need for structural change, with the airline confirming it is ramping up efforts to address its weaknesses.

Cost reductions at Finnair are central in allowing the carrier to compete more aggressively in its key markets, where competition in the Nordic, Baltic and Asian regions is quickly heating up. [1213 words]

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This report contains the following subheadings:

• Revenue gains, but lags passenger growth
• Finnair takes aim at costs
• Weak winter ahead

This report contains the following charts and tables:

• Finnair EBIT profit and EBIT margin (RHS): 3Q2008 to 3Q2011
• Finnair revenue and operating costs and growth in both metrics: 3Q2008 to 3Q2011