TAP has reported its second-quarter revenue to be 99% of its 2019 earnings. TAP Air Portugal has shown a positive recovery from the pandemic in its second quarter financial report (Q2). The airline is nearing its pre-pandemic numbers and has dramatically exceeded its numbers from the same period in 2021. Revenue reached 99% of levels reported in Q2 2019. The number of departing passengers also reached 81% of 2019 levels, while total departures reached 92%. The carrier’s load factor increased by 32% from Q2 2021 levels bringing the total load factor to 80.4%. Notably, operating costs have also risen 92.5% from the same time last year.
Positive growth
TAP has released its financial report for the second quarter of 2022. While numbers still lag behind pre-pandemic figures, they are catching up quickly. Total revenue for the quarter has reached 99% of revenue recorded in Q2 2019, quadrupling between Q2 2021 and 2022. Reported revenue rose from €597.4 million ($592.4 million) to €830.6 million ($823.7 million).
The rise in revenue is primarily due to increased fares and higher capacity. The increase in fares has resulted from higher operating costs, global inflation, and an increase in demand. Capacity, measured in Available Seat Kilometers (ASK), nearly tripled from last year, bringing the quarter’s ASK to 92% of pre-pandemic levels. Meanwhile, the airline’s load factor increased to 80.4%, 96% of 2019 levels.
The second quarter saw only 8% fewer departures in 2022 than in 2019. The total number of passengers was only 81% of those in 2019. The airline has managed to make a strong recovery from the pandemic so far. The CEO of TAP, Christine Ourmières-Widener, addressed the company’s recent recovery success, saying,
“The second quarter saw very healthy demand and higher revenue per passenger, which allowed us to offset the increase in costs. Prospects for the fourth quarter and next year remain uncertain. The execution of the restructuring plan remains key.”
The airline intends to continue following its restructuring plan for the remainder of the year, hoping to surpass all of its positive 2019 numbers soon. It plans to capitalize on the high levels of demand that have fueled its recovery to this point.
Increasing costs
The airline has been plagued, like every other, by rising operating costs. Recurring operating costs rose 92.5% from last year, totalling €782.7 million ($776.2 million). Everything from wages to fuel has driven up operating costs for the company. Fuel alone cost the airline €277 million ($274.7 million) in the second quarter of 2022. However, having calculated the increase in ASK, the airline reports that its operating costs are 4.1% lower than in 2019.
The passengers have felt the rising costs as all expenses have been distributed amongst the individual ticket sales. These higher fares and increased capacity have brought the airline’s revenue close to pre-pandemic levels. It attributes the success it has seen to its implementation and dedication to its pandemic recovery plan.
Source: simpleflying.com
