Airline financial results are looking more robust suggesting the squeeze on profit margins have peaked, with freight experiencing its strongest first half growth since 2010, IATA says.
The International Air Transport Association (IATA) says the squeeze on profit margins from higher costs and weak yields peaked in the first quarter, with airline profits improving in the second quarter of 2017 compared to the previous year.
In its sample for the Airlines Financial Monitor June 2017 – July 2017, the sample of 24 airlines saw net post tax profits increase from $5.8 billion in the second quarter of 2016 to $6.4 billion in the same period of this year.
North American profits dipped from $4.7 billion to $4.6 billion, while Asia Pacific was up from $348 million to $626 million, and Europe from $712 million to $1.2 billion.
The association reports that airfreight volumes grew by 10.4 per cent in the first half of 2017, the fastest pace since 2010, but industry drivers indicate that the best cyclical growth upturn may have passed.
Capacity is on the up, with available freight tonne kilometres growing 3.6 per cent in the first half, while load factors continue to recover and are four percentage points higher than its load point in early-2016.