Aeroflot losses down 24% in Q1

Russia's largest airline posted a net loss of 2.291 billion rubles in Q1 2017 (Aeroflot)

Russian flag carrier Aeroflot posted a net loss of 2.291 billion rubles ($42.43 million) in the first quarter of 2017, improving 24% year-on-year. The information is contained in the airline’s financial report filed in compliance with the Russian accounting practices.

The carrier’s revenue grew by less than 1% to 87.779 billion rubles; its cost of sales increased by 6.7% to 89.499 billion rubles. Aeroflot’s gross loss stood at 1.720 billion rubles, against 3.280 billion rubles in profit posted for the same period in 2016.

As of March 31, 2017, the airline’s volume of long-term liabilities had shrunk 14% compared to the end of 2016 and now stand at 15.262 billion rubles. Its short-term liabilities grew by 28% to 101.893 billion rubles.

The overall improvement in Aeroflot’s financial results is most likely due to the carrier’s continuously growing traffic. The airline carried 7.015 million passengers in the first three months of this year, or up 12.6% on the same period last year.

Aeroflot closed 2016 with a net profit of 30.617 billion rubles (in keeping with the Russian accounting standards), against the net loss of 18.928 billion rubles reported in 2015. The main drivers behind this growth were the carrier’s 11% increase in passenger traffic, a load factor increase by two percentage points, the management’s cost-cutting efforts, and the overall rise in demand for air travel by the end of last year, backed by the strengthening national currency and a capacity shortage on the Russian market.