10/05/24
- Improved operational performance in the first quarter
- Further Revenue Growth
- Resilient Operating Results
Operating Revenues totalled EUR 862 million, an increase of 3.1% compared to the first quarter of 2023, with passenger segment revenues standing out (+5%), where there was also an increase in PRASK (+1.2%) and yield (+1.8%).
In the first quarter of 2024, TAP recorded a Recurring EBITDA of EUR 83.7 million and a negative Recurring EBIT of EUR 43.3 million, significantly higher than pre-crisis levels of 2019 (EUR 5.5 million and EUR -99.3 million, respectively).
On 31 March 2024, the Group had a strong liquidity position of EUR 1,133.4 million, an increase of EUR 344.0 million compared to the end of 2023, following the execution of the second capital tranche by the shareholder in January 2024, in the amount of EUR 343m. This figure confirms TAP's disciplined and prudent financial management.
Luís Rodrigues, CEO of TAP, believes that " In the first quarter of 2024 we continued the structural transformation TAP required. The investment in our people, including the termination of salary cuts, inflationary adjustments and new collective labour agreements have an immediate impact in the bottom line but it will continue to pay off. We were able to increase capacity, carry more passengers and improve load factor when compared to 1Q23, which translated into increased revenue, significantly lower disruptions, improved punctuality and regularity on a substantial congested infrastructure. This also translated into a jump in NPS from 12 to 24. We trust fully in our people, and we know we will be up to the challenge of a strong Summer, with a significant increase in frequencies to the Brazilian and North American markets. Our focus and commitment remain unchanged: to establish TAP into a sustainably profitable airline and as one of the most attractive companies in the sector for all our stakeholders."
In the first quarter, the number of passengers carried increased by 0.6% compared to the first quarter of 2023 ("1Q23"), while operating 2.0% less flights than in 1Q23. Compared to pre-crisis levels of 2019 (“1Q19”), carried passengers reached 104%, surpassing them, while operated flights reached 90%.
Capacity (measured in ASK) increased by 3.8% compared to 1Q23, also exceeding pre-crisis levels, reaching 114% of the 1Q19 values. The Load Factor improved by 0.3 p.p. to 79.3% when compared to the previous year and by 4.1 p.p. when compared to pre-crisis levels.
Operating revenues totalled EUR 861.9 million, increasing by 3.1% compared to 1Q23, surpassing and representing 140% of 1Q19 operating revenues, mainly driven by passenger segment revenues. These increased by EUR 37.2 million (+5%) compared to 1Q23 to EUR 774,7 million, generating a PRASK of EUR 6.25 cents - an increase of 1.2% (+EUR 0.07 cents) compared to 1Q23 and an increase of 28.0% (+EUR 1.37 cents) compared to 1Q19.
The Maintenance division’s revenues amounted to EUR 45.0m, recording an increase of EUR 1.4m compared to 1Q23, mainly due to better conditions in the supply chain that had delayed scheduled activities in previous quarters. The Cargo segment's revenues decreased by EUR 12.1m to EUR 36.7m, recording a decline of 24.7% compared to 1Q23, due to the normalisation of cargo yields observed in the market, albeit surpassing 2019 levels.
Recurring operating costs totalled EUR 905.2 million, an increase of 7% or EUR 59.1 million compared to 1Q23. This variation is mainly the result of an increase in personnel costs (+EUR 70.5 million or 56.9 per cent) due to new company agreements, offset by a reduction in fuel costs (-EUR 23.6 million or 8.5 per cent) due to a lower jet fuel price.
The overall CASK from recurring operating costs increased by 3.1%, reaching EUR 7.30 cents compared to 1Q23. Excluding fuel costs, CASK from recurring operating costs reached EUR 5.26 cents, increasing 10.3% compared to 1Q23 and 2.8% compared to 1Q19.
The recurring EBITDA amounted to EUR 83.7m in 1Q24, despite the reduction of EUR 36.3m compared to 1Q23. The recurring EBIT2 recorded a negative amount of EUR 43.3m, decreasing by EUR 33.1m compared to 1Q23. Considering non-recurring items, EBIT reached EUR -57.1m. Compared to pre-crisis levels, Recurring EBIT and EBIT increased by EUR 55.9m and EUR 44.3m respectively.
The net income was negative by EUR 71.9m, showing a reduction of EUR 14.5m compared to 1Q23. Nonetheless, when compared to 1Q19, it improved by EUR 34.7m.
On 31 March 2024, the Balance Sheet showed a robust cash and cash equivalents position of EUR 1,133.4 million, an increase of EUR 344.0 million compared to 31 December 2023, following the execution of the second capital tranche of the EUR 343 million capital increase made by the shareholder on 4 January 2024.
From an operational perspective, two destinations from Lisbon were reopened for the summer season at the end of the first quarter: Naples and Porto Santo. The fleet consisted of 99 aircraft on 31 March 2024, with the addition of 1 aircraft compared to 31 December 2023, with 68% of the medium and long-haul operational fleet consisting of NEO Family aircraft (compared to 67% on 31 March 2023 and 17% on 31 March 2019).
You can read the full press release for the first quarter of 2024 here.
