Croatia Airlines swings to Q1 loss

Croatia Airlines has posted mixed results for the first quarter of the year by recording an 11.4 million euro net loss, while passenger numbers improved to reach record levels. The carrier's consolidated net loss slumped from a profit of 1.2 million euros last year. However, the airline noted that 2017's quarterly results were impacted by the sale of its five weekly slot pairs at London's Heathrow Airport for eighteen million euros. If the one-off sale was to be deducted from last year's financial performance, the airline's net loss in 2018 would have improved 13% to that of Q1 2017. During the first three months, revenue grew 2% to 34.6 million euros, while expenditure was down 2% totalling 46.4 million euros. It spent most on flight operations, primarily due to the higher cost of fuel, followed by passenger services, as a result of the growing number of travellers handled, then maintenance, as well as promotions and sales.

The carrier handled a record 354.390 passengers during the first quarter, an increase of 7.6%. Of those, 92.018 travellers were carried on domestic flights, up 12.3%, while 259.486 passengers flew on international services, an improvement of 6.4%. The strong growth in domestic passengers was partly caused by Pula Airport, which was closed between January and March of last year due to the overhaul of its runway. The remaining 2.886 passengers were carried on charter flights, down 18.2% year-on-year. However, charters accounted for only 1% of overall traffic. The company operated 5.089 flights during the three-month period, which is up 2.4% compared to 2017. The average cabin load factor, a measure of seat capacity utilisation, stood at a record 70.6%, up 7%. It marks the first time the average cabin occupancy rate has exceeded 70% during this part of the year. It totalled 71.3% on international services and 64.9% on domestic flights. Passenger carrying capacity, measured in Available Seat Kilometres (ASKs), amounted to 335 million, down 3.7% year-on-year.

Croatia Airlines' Director for Network and Revenue Management, Krešimir Mlinar, recently noted that similar growth trends are expected throughout the year. "We have managed to stabilise the business. We expect for our passenger numbers to continue growing in 2018 and to overtake last year's record when 2.1 million travellers were handled", he said. The carrier will introduce seasonal flights from Zagreb to Dublin, Split to Copenhagen and from Dubrovnik to Munich this summer, as well as a year-round service between Zagreb and Mostar. At the same time, it has discontinued its seasonal flights between Zagreb and Pristina, Rijeka and London Heathrow, Pula and Zurich, as well as Dubrovnik and Nice, which were all operated last summer.