Croatia Airlines saw its losses shorten to 38 million euros in 2021, while carrying 788.000 passengers. The airline’s financial performance represents an improvement on 2020 when it registered a loss of 47 million euros. However, it should be noted that the aviation industry was brought to a standstill two years ago, with its affects continuing to be felt throughout 2021 as well. “Despite some positive improvements during the second half of the year, the company continues to face reduced demand, resulting in low levels of revenue which may raise issues of maintaining liquidity in the coming period, especially given the unpredictability of the Covid-19 crisis”, Croatia Airlines said. It added, “The company is taking all necessary measures to optimise the business and continues to implement rigorous cost cutting measures”.
The national carrier handled 788.000 passengers, up 28% on the year before, but still down 64% on the pre-pandemic 2019. At the same time, the airline operated 16.507 flights, up 26% on 2020. “Only during the third and fourth quarter did we see a notable increase in the number of travellers when compared to 2020, but this is still far from the results recorded during the pre-pandemic 2019”, the company said. Croatia Airlines also registered one of its poorest average annual cabin load factors in decades, standing at just 49.9%, representing an improvement of just 0.3 points on the record low figure seen the year before. In 2019, its average load factor stood at 73.6%.
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| Croatia Airlines' quarterly passenger performance |
During 2021, Croatia Airlines maintained services to eighteen international and seven domestic destinations. During the summer season, it operated flights from Zagreb to fourteen European destinations, from Split to twelve cities internationally and from Dubrovnik to six points outside of the country’s borders. During the year, it introduced new routes from Split to Prague, as well as from Osijek to Munich, both of which have since been discontinued. “The scale of this crisis is reflected both in the significant reduction in demand compared to the pre-pandemic era, as well as the dynamic of income from bookings as passenger behaviour has changed and late bookings are now prevalent”, the carrier concluded.
I find these results worrying. I know it is corona but I’m shocked that the load factor is the same as 2020, that the loss is just a little smallet and that the number of passengers was just marginally up. Let’s not forget that from March 2020 until the end of that year very few people travelled while last year there was some improvement
ReplyDeleteBecause for years now their main source of passengers was ZAG where they have FR now. They are taking away their passengers and they are feeling it.
DeleteThe ticket price is simply not competitive when compared with Aer Lingus and Ryanair…. Until this is addressed there is no hope of increasing passenger numbers and therefore revenues
DeleteInteresting to compare to JU. Unfortunately JU posts only annual financial results, but on the operative side they handled 1.58 million passengers while OU 788,000. I believe the difference in fleet isn’t that great anymore.
ReplyDeleteOh and LF on JU was 64%, and on OU 50!
DeleteJU may have carried more pax than OU over the same period, but may have lost twice as much as OU in doing so.
DeleteWe will know in a few months...
DeleteEnd of July/early August.
DeleteThat load factor is shockingly poor.
ReplyDeleteI'm really surprised. They were mostly using Q400s. I thought LF would actually improve quite a bit.
DeleteThis is most worrying
ReplyDelete"the company continues to face reduced demand, resulting in low levels of revenue which may raise issues of maintaining liquidity in the coming period"
It's just a formulation to enable more state aid.
Delete^ Without doubt.
DeleteThere will definitely be more requests for aid. The question is will the government be able to provide it.
DeleteThe government is just as clueless about OU as OU management itself
DeleteDead man walking.
ReplyDeleteWonder how they will perform this year
ReplyDeleteFull force of Ryanair will be felt this year.
DeleteTrue
DeleteIt has nothing to do with Ryanair. FR operates in 200 airports in 30 countries and numerous airline companies can co-exist with Ryanair, or Wizzair, or Easy, or Transavia, Vueling, Volotea, Norwegian.... Aegean won over FR domestically Greece and on several other services, TAP as well, JU did the same with Wizz... Generally, LCC'S and legacies are after diferrent markets and if the legacy, or flag carrier, or both, is led by profesionals, with vision, with business plan and with lot of hard work, no LCC can be so strong to destroy it, not even FR, anywhere. The only reason for poor results of OU is OU itself, because it has no vision, no plan, no capability and no effort invested to win anything and anywhere
DeleteNot good.
ReplyDeleteThe passenger numbers and LF really need to be improved.
ReplyDeleteYou don't say...
DeleteWhere is BCG? Where is the grand revival plan?
ReplyDeleteThe revival plan can't be put into action without money and a steady steam of funds.
DeleteThere is no revival plan. Just a spun story for the media.
DeleteIt seems BCG concluded that feeding LH hubs is the best way forward and the only way to make money
DeleteThings are only going to get worse with Ryanair in Zagreb.
ReplyDeleteThe only good thing in this piece is that they are open, transparent and honest with their results.
ReplyDeleteBecause they are legally obliged to do so.
DeleteLove these passive-agressive allusions. :p
DeleteThe passenger numbers are really low.
ReplyDeleteI understand the demand is generally low but I don't get how the load factor was so low, especially since the Q400 was mainly used on most routes for the during the first half of the year.
ReplyDelete:(
ReplyDeleteHow many employees are there at OU?
ReplyDeleteAround 1000
DeleteThis is crazy for its size. What do all those people do?
DeleteOperation and Flight people do their jobs normally as in all other airlines. Administrative and "management" part are mostly Uhljebs who literally do NOTHING. They drink coffee and gossip for most of the work hours, and use ID tickets to travel the World, sail, play tennis, and similar on days off. Croatia Airlines has jobs non existent in other airlines, INVENTED for Party Uhljebs, nephews and nieces, mistresses... Maybe you should know they had "long range pilot project manager", more than 20 years ago. It was CEO'S mistress, with high school qualification. Of course they didn't manage to start long haul. The next CEO nephew was named Head of Training. He was first officer with some 5 years of overall experience. And it's been going like that for 30 years....
DeleteDire numbers
ReplyDeleteThat's a lot of money.
ReplyDeleteThe question is, would there be a loss if there was no corona?
DeleteThey were loosing money in 2019 already, when the rest of the industry was reporting record profits.
DeleteYes but the question is by how much.
DeleteGood luck OU! I hope they get out of this stronger and the government has a more clearer vision of what it can do.
ReplyDeleteAre you for real?
DeleteLow number of routes, low passenger numbers, low load factor and high loss. Terrible.
ReplyDeleteNot surprised by the result
ReplyDeleteLet's hope there is a strong recovery in 2022.
ReplyDeleteYou hope too much in this case unfortunately.
Deletesomething DRASTIC needs to change at this company!
ReplyDeleteThey need a reality check. It's not covid that's hurting them it's their inability to compete with FR or at least to find a way to coexist with them. Losing €38 million is a tragic number for an airline their size.
ReplyDelete+1
DeleteThis is depressing
ReplyDeleteThe loss is not that huge, all things considered.
ReplyDeleteIt's their second biggest loss in history...
DeleteBravo Hrvatska!
ReplyDeleteBravo for what?
DeleteFor being open, transparent and honest!
DeleteLOL. All other airlines report their financial and operational results. Are you implying other airlines are fabricating their audited results while OU is the only one transparent and honest?
DeleteSpeaking of transparency, how much did the deal with BCG cost? Also how much did it cost to get a second advisory firm to analyse their business decisions during Covid, because they did that too.
Bravo @An.10.30!!! +1000. I really don't get these brainwashed individuals who advocate crime and corruption. Actually that's the only thing which can be bravoed in Croatia, both the airline and the country as a whole. Unfortunatelly.
DeletePassenger growth in reality is non existent because their number of flights increased by the same amount.
ReplyDeleteExactly!
DeleteOU will have to adopt a completely different approach and strategy to their operations now that things
ReplyDeleteare stabilizing with the pandemic if they want to survive
They need to adopt a new management first
DeleteI believe we have reached a point of no return. No management can fix the problems.
DeleteWhat is the passenger yield, based on revenue passenger kilometers?
ReplyDeleteNothing better could be expected in these times.
ReplyDeleteYes it could have. Most airines had significantly better results in 2021 compared to 2020. For OU, that is not the case.
DeleteEveryone is loosing money.
ReplyDeleteBut most are reporting much better results than this.
DeleteI don't think they can survive a post-covid world with FR in town.
ReplyDeleteThey will because the government won't let them go bust.
DeleteWe will see.
DeleteThe government will cover the losses.
ReplyDeleteThey won't be able to pump money forever. Something has got to give.
Delete@9.49 That's what was said about Malev and Cyprus Airways too.
DeleteAnd people expect them to order new new aircraft with this kind of financial result?
ReplyDeleteThey definitely can't but the loss has little to do with it. They wouldn't be able to afford it even during normal times.
DeleteAt least we can see their performance getting better in 3rd and 4th quarter.
ReplyDeleteWhat are OU's plans for this sumner? I can't believe they don't plan to resume old routes or launch new ones.
ReplyDeleteMore of the same. Nothing new planned.
Deletethey need to open a base in LJU if they want to get some passangers
ReplyDeletePassengers are already coming to ZAG from Ljubljana, why should OU go there?
DeleteBecause they are coming primarily to fly with Ryanair, not Croatia Airines
DeleteI don't think Aegean is interesting anymore for OU even now that they got Animawings in Romania. It's sad tho because i believe Aegean could bring OU back to life.
ReplyDeleteAgree but I think they don't need this extra baggage.
DeleteSo the only two new routes they launched were both cancelled. Who did their internal planning?
ReplyDeleteLOL. Not important in their mindset. Gvt will provide for salaries. Why bother with responsability or take consequences for failures? Oh wait, maybe BCG consulted them inappropriately
DeleteCroatia Airlines has used a total of 0 opportunities during Covid, and some opportunities did arise.
ReplyDeleteThese results are the best answer to people why they are not launching new routes. Because no matter how much they increase flights, passengers are not coming back to them. Introducing new flights will only increase costs and losses which is something they can not afford at the moment.
ReplyDeleteThat should have based 1 Q400 in Ljubljana and 1 in Sarajevo. Now it's too late for Sarajevo with Wizz.
ReplyDeleteLjubljana is a missed opportunity.
DeleteI think it is too expensive to do something like that with limited chances for success.
DeleteI hope things improve
ReplyDeleteTheir clock is ticking
DeleteWhat can Croatia Airlines realistically do to turn things around?
ReplyDeleteUnfortunately I don't see a way out of this for OU. Sooner or later they will cease operating and Ryanair will completely take over.
DeleteThere is the way out. Fire excess administrative work force. Fire Uhljebs. Close jobs nonexistent in other airlines. Get professional management, not only CEO, whole team, foreigners if necessary, but people who know what they do. Stop with corruption on all levels, BCG just one of the latest examples. Stop wasting money on sponsorships. Get new position within existing alliance or change it completely. Grow network, look region, look East, look distant markets, stop just feeding LH and making losses on those routes. Be flexible, in pricing and route planning. Adopt agressive marketing, be visible for others. WORK, change mindset I don't give a shit I will get my salary next month anyhow. There are plenty plenty plenty of things which can be done and potentials of the market are such that not taking advantage of it and continuing this status quo is equal to national treason.
DeleteSorry, OU. Time to get out of your comfort zone and accept reality. Almost all EU countries face healthy competition and their flag carriers have adapted to LCC. Time to restructure and move on with reality.
ReplyDelete+1
DeleteThey have started changing their fare structures which is good.
ReplyDeleteConsidering the unfortunate development with Ukraine, rasing energy costs (115$ barrel) this year will be na Amargedon. Especially if tickets are sold at proces which when flown will prove to be a complete loss...
ReplyDelete*sold at prices....
ReplyDelete