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Finnair posts higher losses but expects steady business this year

CEO Pekka Vauramo says cost-cutting moves are paying off, as Q4 losses shrank year-on-year.

Finnairin toimitusjohtaja Pekka Vauramao Ylen aamu-TV:n vieraana 24. toukokuuta.
Finnairin toimitusjohtaja Pekka Vauramao Ylen aamu-TV:n vieraana 24. toukokuuta. Image: Yle Uutiset

National air carrier Finnair lost more than 36 million euros last year after making a small profit of less than 12 million in 2013. However its fourth-quarter losses were considerably lower than during the same period of the previous year, about nine million euros compared to 21 million in late 2013.

CEO Pekka Vauramo blamed the weak results on declines in both passenger and cargo volumes, as well as lower sales by the airline’s travel agency, Aurinkomatkat.

However he says cost-cutting moves are paying off.

”We not only achieved our cost reduction target of 200 million euros, but exceeded it by approximately 17 million euros by the end of the year,” said Vauramo. ”The savings agreements we concluded with various employee groups will continue to provide us with important additional cost savings gradually, starting from the first quarter of 2015. I am particularly pleased that the outcome of the negotiations enables us to continue to develop our operations together with our employees.”

New planes on the way

The flag carrier expects turnover to remain steady this year. Last year’s turnover was just under 2.3 billion euros, or about the same as the previous year’s 2.4 billion.  The board recommends that no dividend be paid out to shareholders this year.

On a more positive note, Vauramo notes that this year Finnair is to become the first European airline to begin flying the new lower-emission Airbus A350 XWB planes. The first is to be delivered next autumn.

Established in 1923 – the same year as Czech Airlines and Aeroflot – Finnair ranks among the world’s five oldest airlines.

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