FOXTROTS

Fox – sly.  Trots – left-leaning (Trotsky) plus its more insalubrious meaning.

Foxtrots – leading the industry in a dance.

 

 

WYSKs – Alitalia, Ryanair.

WYSK – What You Should Know.

 

Alitalia! TinT Rides Again!

TinT (Truth in Travel): Analysing Alitalia’s 2015 results.

 

Alitalia’s heading:

‘On track for profitability by 2017; reports strong 2015 performance.’

Ours:

‘Alitalia revenue and traffic fall again; can it make 2017 profitability target?’

 

You wouldn’t know from Alitalia’s public announcements, but 2015 seemed to be another year of operational weakening. ‘Seemed’ because the company does not publish all the data every year.

 

We normally look at seat sales, and when we look at finance, at revenue and operating profit (not net, which can be more easily manipulated). So:

-Alitalia’s peak year for seat sales seems to have been 2011, with 24.6mn. The company does not reveal growth in 2015 (and did not report 2014 data) – just the figure. That was 22.1mn, thus a 10.2% fall against 2011 – an average annual 2.6% fall.

-Revenue. We have US$3.99bn (at US$1 to €0.90) for 2012 – no full-year since then. In 2015 US$3.68bn -7.8%, an average annual 2.7% fall.

-Operating profit. No data.

-Our manipulations. In 2012 Alitalia’s revenue was US$165 per seat sold (say, flight-segment). In 2015 it was better, US$167, a 1.2% growth, so 0.4% average annual growth.

-Other. It provides other data, but without comparative information, most are essentially worthless. Such as US$262mn from ‘codeshare revenue’. Of course Alitalia indicates that this is good, but with no comparative or other data, how can we know? Its load factor (not further defined, but we have assumed RTK over ATK, not RPK over ASK) looks worryingly low, at 76.2%. We would have thought it needs at least 10-points higher. That said, it is actually an improvement on the latest data we have, for 2006, of 65.7%!

 

 

 

Ryanair overtakes Europe’s top-3 airline groups

The IAG* group pushed the AFG* group into No3 place this Q1 among FSAs*. The three are now a similar size – LHG* sold 800k more seats (+4% to 22.3mn), IAG 3600k +10% 20.4mn, AFG 900k +5% 19.9mn.

 

But there is a big shadow over them all, in the shape of a B737. In this Q1, all those giant multi-airline groups were actually smaller than a single airline – Ryanair of course. Ryan has been the largest NFA* in Europe by far for a few years (Easyjet was about the same size until 2001), and became the largest airline of all types 10 years later.

 

In Q1 2015, Ryan was bigger than IAG, but smaller than AFG and LHG. But this Q1, Ryan sold 4900k more seats, growing 27% to 23.4mn!

 

*Notes: AFG = primarily Air France, Hop, KLM, Transavia. FSA = full-service-airline. IAG = International Consolidated Airlines Group (sic) – primarily Aer Lingus, British, Iberia, Vueling. LHG = primarily Austrian, Eurowings, Lufthansa, Swiss. NFA = no-frills-airline.

 

 

 

The Fox

Remember, I’ll be famous after I’m dead.

Advertisements