DALLAS – Although optimistic about short-term results, Finnair (AY) says that it anticipates its average capacity this year will stay about 15-20% below its 2019 pre-pandemic levels. The airline is uncertain as to how long the current uptick in demand will persist.

In addition to the general economic uncertainty that AY says will “weaken the visibility” of travel demand this year, the airline’s business is also facing the dual challenges of high fuel prices and ongoing network disruptions caused by Russian airspace closure.

“With the fading impacts of the pandemic following the opening of China, AY expects normal seasonality to return,” it states.

Chief executive Topi Manner adds, “We believe that the related travel restrictions will no longer affect our operations on any of the routes we operate after the summer.”

Year-End Results Will Lag

But even as AY forecasts a strong improvement in revenue this year, it does not expect its year-end numbers to reach pre-pandemic levels. In that light, Finnair expects its capacity to remain as much as 20% below pre-crisis levels through 2023.

For 2022, AY produced an operating loss of nearly US$175m. But in Q4 2022, it managed a comparable operating profit of nearly US$19.24m for the fourth quarter, the second consecutive quarter in which it generated a profit.

“This is yet another important step in the right direction,” says Manner. “But the road towards profitability on an annual level is a long one, and full of challenges in the operating environment.”

The airline notes that the price of fuel produced a negative impact of US$400m over the full year, US$100m of which occurred in Q4.

AY flew 9.1 million passengers in 2022, which fostered an average load factor of 67.6%.

Featured image: Michal Mendyk/Airways