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Finnair lowers financial guidance due to expected impact of strike

14-Nov-2013 7:30 AM

Finnair lowered (13-Nov-2013) its financial guidance for 2013, due to the expected impact of a strike by the Finnish Flight Attendants' Association (SLSY) and The Finnish Aviation Union (IAU), which will take place between 15-Nov-2013 and 23-Nov-2013, as well as between 27-Nov-2013 and 30-Nov-2013. The carrier expects each strike day will decrease turnover by EUR4.5 million, with the strike to result in a direct revenue loss of EUR60 million and direct operating loss of EUR30 million if carried out to the full extent. The estimates do not include the potential impact of the strike on sales. Finnair stated: "The weak visibility of air traffic development continues due to the uncertain economic outlook in Europe and slower growth in Asia. Fuel costs are expected to remain high in the last quarter of 2013, and the demand for air traffic is estimated to grow moderately. Due to the preparations already made for the possible strikes of SLSY and IAU, Finnair’s turnover will be below the 2012 level and its operational result for 2013 will turn to a loss. If the strikes are carried out to the extent threatened, they will result in further direct revenue losses of at least EUR60 million and decrease Finnair’s operating result by at least EUR30 million. In addition, unit costs excluding fuel (CASK excl. fuel) will increase from 2012. If the strikes are avoided, unit costs excluding fuel are expected to decrease compared to 2012." Finnair added: "The labour agreement negotiations are still on going and Finnair hopes that an agreement is reached to avoid the strike." As previously reported by CAPA, the carrier initially lowered its 2013 guidance on 24-Oct-2013. [more - original PR]