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SAS recovery continues

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12:24 CET+01:00
Scandinavian Airlines System (SAS) said on Tuesday that it was on target for a return to profit in 2005 as net earnings for the third quarter confirmed the company's turnaround.

SAS third-quarter net profit rose fourfold to 529 million kronor (55 million euros, 64 million dollars) against 133 million a year earlier.

"Third-quarter earnings were, as anticipated, positive and in line with the profitability plan for the SAS group," chief executive Jörgen Lindegård said in a statement.

Financial market analysts, polled by SME Direkt, had been looking for a net profit figure of 595 million kronor.

For the first nine months of the year, SAS posted a net profit of 57 million kronor against a loss of 1.09 billion kronor in the same period last year.

SAS said its restructuring plan "Turnaround 2005", launched in 2002, had been almost completed, and it was looking only for another 500 million kronor in savings to achieve its 14 billion overall cost reduction aim.

The airline's markets continued to be dogged by massive over-capacity and price pressures, Lindegaard said, adding however that pressures had abated during the autumn.

"Continued uncertainty regarding development in the airline industry gives reason to be cautious, but provided there are no significant changes in the business environment, adopted business plans indicate positive earnings for 2005," he said.

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