IATA is pleased to send the latest business confidence survey of airlines CFOs and heads of cargo.
Key points:
Key points:
- Airline profit expectations for the year ahead have moderated but remain positive, according to IATA’s quarterly survey of airline CFOs and heads of cargo in January;
- The rate of expected improvement in profitability over the next 12 months has fallen over the past 2 quarters, suggesting that improvements in key drivers might have peaked earlier in 2015;
- Recent gains in profitability have been driven by strong growth in passenger volumes and falling input costs;
- Passenger volumes were reported to have expanded at a robust rate during Q4, and there are signs that weakness in cargo volumes has bottomed out, which is consistent with FTK data and the lackluster demand backdrop;
- The growth outlook is positive for both passenger and cargo businesses, but the share of respondents expecting improvements has decreased compared to a year ago. This likely reflects concerns over weakness in the global business environment and emerging market economies;
- Respondents reported seeing a decline in input costs in Q4 compared to a year ago, and that trend is expected to continue in the year ahead;
- Consistent with the lower input costs, the survey also showed weakness in yields in both businesses, for the recent past and the coming year;
- Airline employment activity was reported to have increased in Q4 and that is expected to continue over the next 12 months, consistent with the positive outlook for financial performance.
