The downturn in the air transport sector has hit results at Swissair owner, the SAirGroup. The latest figures show a decline in profits over 1999 of 24 per cent at SFr273 million. But analysts had earlier said profits would fall by around 30 per cent.This content was published on March 6, 2000 - 16:14
The downturn in the air transport sector has hit results at Swissair owner, the SAirGroup. The latest figures show a decline in profits over 1999 of 24 per cent at SFr273 million. But analysts had earlier said profits would fall by around 30 per cent.
Soaring fuel prices, the Kosovo conflict and frequent delays had a negative impact on last year's profits, according to the SAirGroup.
Group chief executive Philippe Bruggisser, who announced the signing of a new partnership with Thai Airways on Monday, said, "In building our aviation group, we are creating an increasingly steady earnings base. And with the stability that this provides, we are excellently placed to finance further expansion."
Looking forward to this year's results, Bruggisser was optimistic but had reservations about the intense competition among airlines in Europe and "high fuel costs".
Over the past three years SAirGroup has transformed itself into an organisation with two prime areas of activity. These are its Swissair airline business, but of increasing importance is its airline related businesses.
The company said that airline related activities made a substantial contribution to these results, helping offset the adverse impact of the downturn in the airline cycle.
Bank Leu equity trader Elonore Charrez was not surprised by the drop in numbers at SAirGroup and pointed out that the year before last they saw "record earnings for the group" and it was difficult to repeat them.
The dividend to shareholders will remain unchanged at four francs per share.
By Tom O'Brien.
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