Rapid Recovery of Passenger Demand and Steady Cargo Demand
Sale of 5 Aircraft for 920 Billion Won... Fleet Maintenance Underway
Korean Air posted solid results for the first quarter of this year, driven by a rapid recovery in passenger demand and steady cargo demand.
On the 8th, Korean Air announced preliminary results for the first quarter, reporting separate basis sales of 3.8225 trillion KRW and operating profit of 436.1 billion KRW. These figures represent increases of 19.6% and 5.1%, respectively, compared to the same period last year. Net profit for the period was 345.2 billion KRW, down 2.9% year-on-year.
Korean Air explained, "Sales increased due to the rapid recovery in passenger transportation volume and steady cargo demand," adding, "Operating profit grew compared to the same period last year despite higher fuel costs and increased airport and cargo handling fees due to increased business volume, as well as rising labor costs from wage hikes."
Passenger business sales in the first quarter rose 32% year-on-year to 2.3421 trillion KRW. This was because supply on most routes, except for some China routes, recovered to 2019 levels. The company improved profitability by timely expanding supply on routes with concentrated tourism demand, such as Southeast Asia and Japan.
However, cargo business sales slightly decreased to 996.6 billion KRW compared to the same period last year, as air cargo rates, which had soared after COVID-19, normalized.
Korean Air stated, "In the second quarter, the passenger business plans to operate routes based on profitability to prepare for intensified competition due to global supply expansion," and added, "For the cargo business in the second quarter, we will strengthen partnerships with related shippers to attract growing e-commerce volumes from China and focus supply on key routes to enhance competitiveness."
Meanwhile, along with the first-quarter results, Korean Air announced that it decided to sell five aircraft for 918.3375 billion KRW. Korean Air explained, "We decided to sell existing aircraft to introduce new aircraft in the mid to long term."
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