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SAS shares slump despite rise in profits

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SAS shares slump despite rise in profits
12:08 CET+01:00
Scandinavian airline SAS reported on Tuesday a slim third-quarter net profit, a switch from a deep loss in 2010, and maintained its positive outlook for all of 2011, but said uncertainty lay ahead.

For the July to September period, SAS posted a net profit of 214 million kronor ($32.7 million), compared to a net loss of 1.05 billion kronor during the same period a year earlier.

Not including non-recurring items, the company's income stood at 298 million kronor, which was an "encouraging but not satisfactory" amount, according to company chief executive Rickard Gustafson, who has been in charge since February.

Following the news, the airline saw its share price fall 7.59 percent to 10.85 kronor in late morning trading on the Stockholm stock exchange, which was up just over one percent.

The fall was expected, according to Nordea analyst Bjarke Petersen, who told the Dow Jones Newswires the SAS results were "all in all" negative.

The company meanwhile saw its sales slip 1.5 percent year-on-year to 10.6 billion kronor.

"While the assessment we made in conjunction with the report for the first quarter of 2011 remains valid, it should be noted that the risks involved with fulfilling this forecast have increased," Gustafson cautioned, as SAS blamed soaring fuel prices and the global economic downturn.

However, the chief executive said, "on condition that nothing unexpected occurs, it is our opinion that there is still the potential for SAS to achieve marginally positive income before tax for full-year 2011."

SAS, which was recently crowned the world's most punctual airline, stressed that it had seen its passenger numbers grow four percent during the quarter to some seven million.

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