SAS announced its result today, and it is even worse than the analysts feared. It is nothing less than a belly-landing for the Scandinavian aviation group.
The deficit last year ended at close to SEK 1.5 billion (USD 208.6), and the fourth quarter ended with a loss of SEK 245 million (USD 34 million). The negative results are nothing less than a belly-landing of the aviation giant.
The analysts had estimated a surplus of SEK 600 million (USD 83.44 million) before tax in the fourth quarter. However, for the fourth quarter of last year, SAS had a recorded loss of SEK 683 million (USD 95 million).
Operating result for the group was a negative SEK 43 million (USD 6 million). The expected number was SEK 899 million (USD 125 million).
The turnover ended at SEK 13,824 million (USD 1922 million), and this is also lower than expected.
Pressed by Norwegian
SAS had a deficit in 2003 of SEK 1,470 million (USD 205 million), compared to a deficit of SEK 450 million (USD 62.5 million) in 2002.
SAS has experienced a gradual improvement in the traffic numbers the last couple of months. However, the problem is that even if the passengers are returning, the margin is pressed by the continuously increasing competition from the low fares airlines.
Challenges are piling up
SAS expects that the challenges will be piling up in 2004 as well, in spite of more positive financial prospect and more travelling.
«The costumers expect more travel choices, lower prices, and also more effective travels,» according to SAS quarterly report.
The SAS management claim that a surplus for the total year is within reach, but does not fail to see that it has to continue to cut costs in order to obtain this.
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