TAP reports net loss, 10% lower than year earlier - Plataforma Media

TAP reports net loss, 10% lower than year earlier

TAP, Portugal’s national airline, had a loss of €627.6 million in the first nine months of 2021, 10.4% smaller than in the same period of last year, the company said in a statement released to the Securities Markets Commission (CMVM)

“Net income as of September 30th of this year was negative in EUR 627.6 million, which represents an improvement of EUR 73.0 million when compared to the homologous period,” reads the TAP statement, released after the close of the market on Thursday. “To this result contributed the negative impact of foreign exchange differences in EUR -125.3 million of which EUR -104.6 million are due to EUR/USD depreciation in future rents and therefore without any cash impact.”

Read also: TAP: Revenue in 2021-2022 will be at 2006-2007 levels

According to the airline, “Revenues as of 30 September 2021 were marked by a recovery in summer traffic but still 67% lower than 2019, with Brazil opening only by the beginning of September and the USA still closed.”

Thus, “total operating income reached EUR 826.8 million which is still slightly below in 1.7% when compared to the same period in 2020,” it continues. “To this result contributed the decrease in passenger revenues of EUR 91.2 million (-13.0% YoY), partially compensated by the cargo and mail segment, which increased EUR 81.9 million (+102.8%).”

Total operating costs amounted to €1.25 billion – “a decrease of EUR 201.4 million (-13.9%) when compared to 9M20, mainly explained by the material reduction in depreciation and amortization caption (EUR -81.0 million) and traffic operating costs (EUR -35.7 million),” it added, noting that the workforce had shrunk by 1,820 employees, “with costs 5.3% lower”.

According to the release, EBITDA (earnings before tax, interest, depreciation and amortisation) for the nine months was up €106.0 million on a year earlie to €75.2 million.

As of 30 September 2021, the company had a cash position of €397.6 million and gross financial debt (excluding lease liabilities without an option to buy) of €2.7 billion – “which includes the loan from the Portuguese Republic of €1.2 billion.”

TAP also revealed that in the third quarter alone, “net profit was -134.5 million euros,” a “slight decrease of 6.4 million euros when compared” to the previous quarter.

The airline said that passenger numbers swelled 127.0% in the third quarter from the second and was up +144.7% from a year earlier.

“The €210.5 million increase in operating revenues to €443.7 million (+90.3% compared to the previous quarter) was driven by the increase in passenger revenues which rose €214.9 million to €368.5 million,” it reported.

“While revenues almost doubled, operating costs reached €489.5 million which shows a modest increase of +27.9% when compared to the second quarter of this year,” the note states, adding that this growth was “mostly explained by fuel costs and operations traffic costs which increased by +71.4% and +76.1% respectively.”

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