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SAS disappoints as losses mount

TT/The Local/pvs · 9 Feb 2011, 11:17

Published: 09 Feb 2011 11:17 GMT+01:00

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"Assuming continued recovery in the home market... and that no unexpected events occur, favorable conditions are in place for the SAS Group to achieve positive income before tax for the full-year 2011", the company said in a statement.

SAS posted a fourth quarter pre-tax loss of 464 million kronor ($72 million), in comparison to a loss of 1.52 billion in the corresponding period of 2009. The airline put the disappointing figures down to non-recurring items and the impact of the Icelandic ash cloud.

Analysts had forecast an average loss of 174 million kronor for the period, according to a Reuters survey.

Turnover amounted to 10.60 billion kronor, compared to 10.32 billion kronor a year earlier.

Adjusted for various forms of non-recurring items and the impact of the Icelandic ash, SAS full-year earnings was a positive 265 million kronor.

"By putting these non-recurring items behind us, we can now devote our energy to looking forward and to focusing on core business," the firm wrote.

Results for the first quarter, normally the firm's weakest period, are expected to be negative, but better than in the corresponding period of 2010.

The company underlined that cash flow from operating activities has improved considerably, which is seen as confirmation that the Action Core SAS austerity programme has created "a good starting point for the future".

Core SAS will be completed in 2011 and the programme is expected to provide an additional, positive effect on earnings of 1.5 billion kronor for the year with restructuring costs expected to be 400-600 million kronor.

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SAS expected the market to expand overall at around 4-6 percent in 2011, and the company plans to expand capacity in line with the market.

The company warned however that the development of the market remains uncertain in terms of both yield (revenue per passenger-km) and jet fuel prices.

TT/The Local/pvs (news@thelocal.se)

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Your comments about this article

12:49 February 9, 2011 by Twiceshy
With the absolute WORST frequent flyer program in the AIR the only hope for SAS is that the GERMANS buy SAS and soon!
13:06 February 9, 2011 by Rap43
I gave up on SAS when they stopped being a full-service carrier. Why would I fly SAS when I can fly Lufthansa?

If I want a no-frills flight I can go Ryan Air... at least they are up-front about not caring for passengers.
13:43 February 9, 2011 by Rishonim
I routinely fly between STHLM and Paris and I avoid SAS as much as possible. They should get back to their best practice and stop the nonsense.
13:59 February 9, 2011 by johnny 2011
I have flewn SAS between Newark/stockholm/newark regularly for 20 years and have never had a complaint. However, maybe it is the short haul flights that have the problems? I would rather fly SAS than Ryan Air anytime. I have never been on Luft Hansa what makes them better? do u think, if they take over, there will be direct flights USA/Stockholm?
14:10 February 9, 2011 by Syftfel
I thought I had read somewhere that SAS was going to sell itself to Lufthansa? It can't happen too soon. Like so many Swdedish companies, SAS has become a welfare institution whose first raison d'être is to provide cadillac pension benefits, and premium free health insurance to its employees. Flying the occasional airplane, with inedible food, has become the afterthought.
14:44 February 9, 2011 by rba
Rap43 nailed.

They provide nearly low-cost service at non-low-cost fares. Screw SAS.
21:32 February 9, 2011 by Beavis
Hey they were offering reasonable fares for one week in January!!(But not the other 51 weeks of the year!) Their European short haul flights are outraguoesly priced (some at 4000kr one way!)

The airline put the disappointing figures down to non-recurring items and the impact of the Icelandic ash cloud. When in the REAL world their losses were due to all the above posts..the 1980s are over SAS and if you keep living in them your gonna go bust!
09:45 February 10, 2011 by aaww
close that airline!!!

an airline that still fly so many Douglas aircraft, imaging the cost of operating them, how would it be possible to make money out of it.
23:32 February 11, 2011 by ptkao
"I have never been on Luft Hansa what makes them better?"

-- eh, yes Lufthansa does make it better. it not only give you a drink (in SAS you don't even get a water) but you also get a sandwiches (or full meal in Lufthansa Italia). Not mention they actually smile when they deliver!

" do u think, if they take over, there will be direct flights USA/Stockholm? "

-- Swiss belongs to Lufthansa and they just start flying Zurich-SF. If there is enough demand between ARN-to any US destination, then why not?!
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