airBaltic Prepares for 2024 Initial Public Offering

DALLAS — Today, airBaltic (BT) corporation management analyzed the Q1 2024 financial results during an online press conference. Airways attended the event in which Martin Gauss, airBaltic CEO, Pauls Calits, COO, and Vitolds Jakovlevs, CFO. 

The airline’s executives reiterated the Q1 2024 results, illustrated the ongoing engine issues situation, and updated the audience about its planned IPO forecasted for the second half of 2024.

After a record Q1 revenue, the airline has successfully refinanced its €340 million bond. Overall, the airline registered an unprecedented Q1 in traffic and profitability, carrying 926.000 passengers, a 20% increase. 

The increased revenue came from higher Business Class demand and more flights offered to leisure destinations. Q1 earnings before interest, taxes, depreciation, amortization, and restructuring or rent costs (EBITDAR) have recorded €17.1 million in 2024. The airline also increased its load factor to 75.9%, an increase of 4.9%, and recorded a 24% increase in its loyalty program.

Currently, BT flies Europe’s second youngest fleet and is the largest airline present in almost all its hubs. The airline plans to introduce two Airbus A319s to fly this summer. 

Network

The airline flies to 86 routes and delivered 9611 network flights in Q1. Spare aircraft capacity increased in Q1, and the airline was not particularly affected by the ongoing engine issues. In 2024, airBaltic plans to operate over 130 flights from its Riga, Tallinn, Vilnius, Tampere, and Gran Canaria (seasonally) hubs. 

However, the airline is preparing for a capacity limitation in Q4 2024 due to forecasted engine maintenance. BT consolidated its lead as the largest A220-300 operator and forecasts a fleet of at least 100 aircraft by 2030. 

In 2023, the airline negotiated an agreement with Pratt and Whitney, which has yet to be agreed upon for 2024. The airline continuously negotiates with the engine manufacturer to establish appropriate compensation for engine delays.

airBaltic is still affected by high fuel prices, accounting for 36% of its share. While this value is down from 45% in 2022, the airline has deemed the fuel costs too high due to geopolitical events.

Finally, Marting Gauss stresses BT's impact on the local economy, which is worth several billion euros. 

IPO

Martin Gauss confirmed the airline is preparing the IPO for the second half of 2024. BT reiterated that the IPO is going as planned and that the engine issues are not an obstacle.

Martin Gauss, President and CEO of airBaltic: “Current results reflect that this has been a positive quarter, driven by increased flights, enhanced operations, and a dedicated focus on customer service. These improvements have successfully attracted more passengers and strengthened our results. Despite the gains, the airline experienced a net loss, primarily due to seasonal fluctuations and anticipated capacity limitations related to an expected Pratt & Whitney engine shortage in 2024. Nevertheless, this does not affect our overall guidance for the year. Moreover, our performance this quarter aligns with management's expectations, and as such, our outlook for the year remains optimistic.”

The featured image shows YL-ABR in Tampere, Finland (TMP).