Swiss International Air Lines (SWISS) achieved adjusted earnings before interest and taxes (Adjusted EBIT) of CHF 564 million in the first nine months of 2018, a 24-per-cent improvement on the CHF 456 million of the prior-year period. Earnings were boosted by improved cost structures, owing primarily to the enhanced cost-effectiveness of the aircraft fleet, whose modernization is now well advanced, and by the positive impact of hedging arrangements that helped secure favourable kerosene prices. Total revenues for the nine-month period amounted to CHF 4.02 billion, an 8-per-cent improvement on the CHF 3.71 billion of January-to-September 2017. Total production for the period was up on the previous year, and the additional capacities were successfully sold on both the passenger and the cargo markets.

 

For the third quarter of 2018 SWISS achieved an Adjusted EBIT of CHF 234 million, a 10-per-cent decline on the CHF 258 million¹ of July-to-September 2017. Prior-year third-quarter results were, however, substantially boosted by certain non-recurring items, such as the release of provisions. Higher oil prices also had their effect on this year’s third-quarter earnings. Total revenues for the third quarter of 2018 amounted to CHF 1.44 billion, up 6 per cent on the CHF 1.36 billion of the prior-year period.

 

SWISS CEO Thomas Klühr says: “We are pleased that we not only achieved our targets here but exceeded them. But the continued climb of the oil price has already been felt in our third-quarter earnings. We were able to partially cushion its impact, thanks to our advanced aircraft fleet with its more cost-efficient credentials and our fuel hedging arrangements. But, looking ahead, consistent cost management will be more vital than ever.”

 

 

While general economic conditions remain currently bright, oil prices have risen substantially over the past few months. And the positive effects of the hedging arrangements that have been made to secure favourable fuel prices will gradually recede, with a correspondingly adverse impact on earnings levels. In view of the strong earnings achieved in the first nine months, however, SWISS expects to report an Adjusted EBIT for 2018 as a whole that is above its prior-year level.

 

 

SWISS made further progress in its fleet renewal in the first nine months of 2018. Two further Boeing 777-300ERs entered service on the long-haul network. Two more Triple Sevens will be delivered in early 2020, and will further expand and intensify SWISS’s intercontinental services.

 

Ten more new short- and medium-haul C Series aircraft were also put into service in the first-nine-month period. And September saw SWISS’s purchase options for ten additional latest-generation Airbus A320neo-family aircraft converted into firm orders – for seven A320neos and three A321neos, which will be delivered in 2023 and 2024. The new orders here supplement the ten A320neos and five A321neos that have already been ordered for delivery between 2019 and 2022, to replace SWISS’s older A320s and A321s. The A320neo family promises substantial improvements in both fuel consumption and noise emissions terms, thanks to its newly-developed engine technologies, its wing vortex generators and its aerodynamic wingtip sharklets.

 

 

SWISS has also been investing in its customers’ travel experience, to continue to strengthen its positioning as a premium carrier. The highlights here in 2018 to date include the new First Class Lounge and new Business and Senator Lounges in Zurich Airport’s Terminal A, and the new premium SWISS Saveurs food and beverage concept for European services from and to Geneva.