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MarketScreener Homepage  >  Equities  >  NASDAQ OMX HELSINKI LTD.  >  Finnair Oyj    FIA1S   FI0009003230

FINNAIR OYJ

(FIA1S)
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Finnair shares slump as rising costs hit profits

07/17/2019 | 05:28am EST
FILE PHOTO: A Finnair aircraft prepares to take off from Manchester Airport in Manchester

(Reuters) - Finnair reported a sharp fall in the second-quarter profit on Wednesday due to rising costs and warned that full-year operating profit would miss market forecasts, sending shares in the Finnish airline down 12%.

Finnair now forecasts 2019 operating profit margin in the range of 4.5-6% of sales, missing an average forecast by analysts of 6.3%, according to Refinitiv data.

Finnair's second-quarter comparable operating profit fell to 47.2 million euros (£42.7 million) from 59.1 million a year earlier, missing analysts' expectations, who on average saw profit at 63.5 million euros, according to Refinitiv.

The Finnish airline cited rising fuel costs and exceptional maintenance costs as the reasons hitting profits.

The market price of jet fuel was 8.9% lower in the second quarter than a year earlier, but due to hedging policy Finnair said its Q2 fuel bill was 25% higher, with capacity growth explaining only half of the increase.

Aircraft materials and overhaul costs increased 39% to 50.7 million euros due to fleet growth, price rises, the decline in the U.S.-based discount rate of maintenance reserves and exceptional maintenance events.

Shares in Finnair fell 12.5% to 6.93 euros, by midday trade in Helsinki.

The airline, which has focused on long-haul flights connecting Asia and Europe, said it expects the operating environment to remain volatile in the second half of the year.

"The slowdown in the economies of Finnair’s key markets and the continued uncertainties surrounding global trade, including the U.S.-China trade talks and Brexit, could impact the demand for air travel and for cargo," it said.

(Reporting by Tarmo Virki, editing by Louise Heavens)


© Reuters 2019
Stocks mentioned in the article
ChangeLast1st jan.
BYD COMPANY LIMITED -1.29% 245.8 End-of-day quote.20.96%
EURO / BRITISH POUND (EUR/GBP) 0.20% 0.89073 Delayed Quote.-0.52%
FINNAIR OYJ -0.15% 0.677 Delayed Quote.-10.30%
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Financials
Sales 2020 837 M 1 011 M 1 011 M
Net income 2020 -622 M -752 M -752 M
Net Debt 2020 1 349 M 1 629 M 1 629 M
P/E ratio 2020 -1,16x
Yield 2020 -
Capitalization 956 M 1 156 M 1 155 M
EV / Sales 2020 2,75x
EV / Sales 2021 1,26x
Nbr of Employees 6 535
Free-Float 42,9%
Chart FINNAIR OYJ
Duration : Period :
Finnair Oyj Technical Analysis Chart | FIA1S | FI0009003230 | MarketScreener
Technical analysis trends FINNAIR OYJ
Short TermMid-TermLong Term
TrendsNeutralBullishBearish
Income Statement Evolution
Consensus
Sell
Buy
Mean consensus OUTPERFORM
Number of Analysts 5
Average target price 0,57 €
Last Close Price 0,68 €
Spread / Highest target -4,34%
Spread / Average Target -16,1%
Spread / Lowest Target -29,4%
EPS Revisions
Managers and Directors
NameTitle
Topi Manner Chief Executive Officer
Jouko Karvinen Chairman
Jaakko Schildt Senior Vice President-Operations
Mika Stirkkinen Chief Financial Officer
Jaana Maija-Liisa Tuominen Independent Non-Executive Director
Sector and Competitors
1st jan.Capitalization (M$)
FINNAIR OYJ-10.30%1 156
DELTA AIR LINES, INC.-0.57%25 393
RYANAIR HOLDINGS PLC-2.80%21 538
AIR CHINA LIMITED-9.67%14 128
UNITED CONTINENTAL HOLDINGS, INC.1.48%12 772
CHINA SOUTHERN AIRLINES COMPANY LIMITED-6.49%12 072