EasyJet, Singapore Airlines, and Qantas Airways all reminded investors that heavy losses were still hitting the sector on Thursday, and issued cautious warnings over the air-travel recovery.
The trio painted a picture of uncertainty surrounding the recovery, even as many countries begin easing travel restrictions and the European Union prepares to open up for Covid-19 vaccinated tourists.
The trio painted a picture of uncertainty surrounding the recovery, even as many countries begin easing travel restrictions and the European Union prepares to open up for Covid-19 vaccinated tourists.
Many airline stocks have climbed sharply since the end of last year amid hopes for a bumper summer holiday period, but with the season drawing closer, such a recovery now looks more in the balance.
ASIA
Singapore Airlines (ticker: C6L.Singapore) reported a record 4.27 billion Singapore dollars ($3.2 billion) annual loss in what it described as the“toughest year in its history.”Passenger numbers slumped 98% to just 596,000 in the year to March 31.
Singapore’s national airlines raised doubts over the air-travel recovery, warning that its trajectory remained “unclear.”
Despite a resurgence of Covid-19 cases across much of Asia and other parts of the world, the airline said accelerating Covid-19 vaccination programs in key markets meant it was hopeful for further improvement in international demand in the second half of 2021. The stock climbed 1.3% after earnings and is now 11% up year-to-date.
Restrictions in Singapore and Taiwan have been tightened in recent days following spikes in Covid-19 cases, while other countries such as Thailand and Malaysia are also battling rising cases. Vaccine rollouts are also proving slow in the region, particularly in comparison to the U.S., the United Kingdom, and parts of Europe.
EUROPE
Low-cost European carrier EasyJet (EZJ.UK) posted a pretax loss of £701 million ($990.4 million) in the six months to the end of March, down from a £193 million loss the previous year. Unsurprisingly, passenger numbers fell 89% to 4.1 million year-over-year.