Brussels Airlines profit flies to record high

Brussels Airlines made record profits in the third quarter. The adjusted operating profit or ‘adjusted debit’ amounted to 51 million euros, “the best quarterly result in Brussels Airlines’ 20-year history,” the airline said.

With the strong increase in demand, good development of liquidity, and financial support of parent group Lufthansa, Brussels Airlines will be able to fully replay the 290 million euros of aid it received from the Belgian state to survive the corona crisis by the end of the year.

2,28 million passengers

Brussels Airlines, entirely in German hands since 2016, saw business travel pick up during the summer, traditionally the best period for airlines, and tourism continues to recover. The airline carried 2,28 million passengers, half more than a year earlier. The average aircraft occupancy rate also rose from 70% last summer to 84% now. Revenue reached 436 million euros, giving an adjusted operating profit of 51 million euros.

“Our company has shown that it can fly profitably, even in today’s challenging economic reality,” says managing director Nina Oewerdieck. However, she adds that this record profit will not be enough to get out of the red for the full year 2022.

The profit is insufficient to compensate for the year’s first half, in which the coronavirus omicron variant and high-energy process still pushed the airline firmly into the red. But by 2023, Brussels Airlines hopes to be profitable annually.

Four extra planes

The airline also wants to grow, including four more medium-haul aircraft. That will also create more jobs, but details have yet to be worked out. With the additional aircraft, which will make the fleet 45 aircraft (36 medium-haul and nine long-haul, including the three Airbus A320neos, already announced for 2023), BA plans to expand operations to neighboring countries and optimize its European point-to-point and feeder network.

No more debts to the Belgian state

Brussels Airlines will also repay the 290 million euros in state aid it received during the corona crisis before the end of this year with the help of parent group Lufthansa. “With this capital injection, Lufthansa confirms its belief that a profitable future for Brussels Airlines is within reach,” CEO Peter Gerber says.

The Belgian government had pledged state aid in July 2020 as the corona crisis threatened to completely topple Brussels Airlines, which had previously been in bad shape and was restructuring. The loan, the repayment will be made with interest, was supposed to be repaid by the end of 2026 at the latest, but so it will happen four years earlier.

Keeping your feet on the ground

At the same time, Gerber warns against euphoria. “One swallow does not make a summer,” he said in an interview with the press agency Belga. For him, the result with Brussels Airlines – still 20% smaller than before the corona crisis – mainly shows that “if the demand is there and we can run a more or less normal business, we can be profitable. It may be the first time we prove this at Brussels Airlines.”

Confirmation is expected next year. BA expects to be profitable again on a year-on-year basis then. The CEO also called for “fairness” from all concerned, including the unions. For instance, talks are still ongoing with the pilots on remuneration.

The Reboot and Reboot Plus restructurings saw about a quarter of the workforce, a third of the fleet cut, and fewer destinations. To reduce the high staff workload, 675 flights were eventually cut from the summer offer. So the fleet would now grow again to 45 aircraft, and almost 300 people have already been recruited, and several hundred more will be added over the next year, Gerber says.

And it seems that BA is still an attractive employer in the Belgian market, as the airline had more than 12 000 applications for the vacancies that were already there this year – at the end of September, the airline had 3 217 employees.

All of Lufthansa’s loans almost paid off

The entire Lufthansa group posted a third-quarter adjusted operating profit (adjusted debit) of 1,1 billion euros and a net profit of 809 million euros. It had already doubled its profit forecast for 2022 last week, counting on an adjusted operating profit (edit) of more than 1 billion euros for the entire year.

State aid from sister company Austrian Airlines (210 million euros) will also be repaid this year. With this, Lufthansa will have repaid all the support it received from governments during the corona crisis. In Germany (airline Lufthansa) and Switzerland (Swiss), debts to the state were repaid earlier.

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