S7 Airlines Part 2: history of growth in fleet, pax, revenue & profit shows benign market structure

Part 1 of CAPA's analysis of the S7 Airlines Group examined its network and competitive positioning, particularly with respect to the Russian market leader Aeroflot Group. Away from its Moscow Domodedovo hub, S7 has pockets of strength serving cities in Asia from regional Russian airports.

This second part of the report on S7 highlights its respectable track record of growth in its operations and profitability since the establishment of its subsidiary Globus in 2008. In 8M2016 its passenger growth rate accelerated to 25%, after a 6% increase in 2015. Although demand for international air travel to/from Russia has slumped due to geopolitical developments, S7 has benefited from growth in the domestic market and from capacity cuts by foreign competitors on international routes. It has also benefited from the 2015 collapse of Transaero (although Aeroflot has gained more from this).