Brussels Airlines future and financial perspective

[sn26567]

In Austria, OS -7.3% ! But now they have a new CEO from LH to change the situation...

In Finland, Finnair: -0.3%

[Flanker2]

But now they have a new CEO from LH to change the situation...

Like that is going to help
LH don't know how to make Passage profitable, so they better work on that first.

Personally, if I had to choose between any LH manager and Monsieur Gustin, I would pick Gustin all day long.
But of course, if I had to pick between Gustin and Chew Choon Seng (Ex-SQ), there is no competition. In fact, SQ has been going downhill since he left and that's despite the marvelous state that Mr. Seng has left the airline in to his successor.

In anyways, SN has marked a solid performance in April.
Regarding fares, lately FR is becoming very greedy on the high season fares, so keep comparing!

[Inquirer]

For those who still care about the meanwhile pointless progress of the many different legal proceedings against the measures taken by the Belgian government aimed at leveling the playing field:

http://www.lecho.be/economie_politique/ ... .art?ckc=1

similar article in De Tijd:

http://www.tijd.be/ondernemen/luchtvaar ... .art?ckc=1

[airazurxtror]

It's only the first round.
Don't count your chickens before they are hatched ...

Toutefois, une plainte de Ryanair devant la Commission européenne est toujours en cours d'enquête et le Conseil d'Etat doit aussi se prononcer sur un recours de la compagnie irlandaise.

[convair]

To me, the 18% increase in Afi pax in May is deceiving. Indeed, as SFM pointed out, I believe there was one A330 in C-check in May last year. And this must have affected the Afi flights almost exclusively; therefore the ask in May 15 must have been about 20% higher than in May 14! This would indicate a lower l/f in 2015 than in 2014; quite disappointing IMHO.
The swap NBO/ ACC brings a higher degree of uncertainty re the Afi flights future, the more so if LH does not withdraw immediately from ACC.
I wouldn't go as far as saying it's time for SN to adopt an "out of Africa" mode, but diversification for the long haul network should be high on their to-do list nowadays.
Now, for Europe, they seem to be on the right track: just keep network expansion and fleet renewal.

[Passenger]

The annual accounts 2014 (including the consolidated account) from both Brussels Airlines and SN Airholding have been published.

Would be great if someone with professional experience in accountancy could comment them.

[RoMax]

The transfer of the Accra route (linked to the transfer of the NBO route) from Lufthansa to SN is now in some (mainly African) media after LH informed the transport ministry in Ghana about it

http://www.ghanaweb.com/GhanaHomePage/N ... out-369275

[Stij]

Would be great if someone with professional experience in accountancy could comment them.

Analyse van de jaarrekening is a loooooong tima ago!

Cheers,

Stij

[Passenger]

The annual accounts 2014 (including the consolidated account) from both Brussels Airlines and SN Airholding have been published. Would be great if someone with professional experience in accountancy could comment them.

Analyse van de jaarrekening is a loooooong tima ago!

The annual accounts (= the real ones, not the estimates) have only been published on 2nd July 2015.
I haven't seen a summary here yet - let alone comments - let alone an analyse.

Example: final nett result (loss) has improved from (21.954.423) in 2013 to (4.156.962) in 2014.

[Atlantis]

Maybe an other chance for Brussels Airlines to grow faster and stronger in Africa. Again one of the other carriers is quitting an African destination that SN is flying on.

This time it is BA who is quitting Entebbe out of their network. Also not that long time ago Air France/KLM decided to quit or to fly less to Africa.

Some opportunities for BRU and SN.


http://www.luchtvaartnieuws.nl/nieuws/c ... -en-almaty

[sn26567]

Also not that long time ago Air France/KLM decided to quit or to fly less to Africa.

That's wishful thinking. This morning, AF/KL announced that, due to their bad financial results during the first half of the year, they would reduce by 5 to 15% flights to a number of destinations next winter, including -6% to East Africa. Hardly an opportunity for SN. I also saw that KL would reorganise its flights to East Africa (Kilimanjaro, Entebbe and Kigali), but far from reducing them, they would increase some of them, Kigali remaining a daily destination in combination with either Entebbe or Kilimanjaro.

[airazurxtror]

The number of passengers carried by Brussels Airlines increased by 12.5 % in August 2015 compared to the same period last year,to reach 700,891 people.
In August , the load factor was also on the rise at record level of 83.9 %.

No profit forecast ...

[brusselsairlinesfan]

The number of passengers carried by Brussels Airlines increased by 12.5 % in August 2015 compared to the same period last year,to reach 700,891 people.
In August , the load factor was also on the rise at record level of 83.9 %.

No profit forecast ...

Not a very fair comment, if You ask me...

[Passenger]

No profit forecast ...

Brussels Airlines is no stock exchange registered company, so they don't have to publish a forecast.

I'm quite sure they have a forecast, but announce this only to the Belgian and German shareholders.

Once Lufthansa is full owner, the forecast for Brussels Airlines will appear in LH's forecast.

[Flanker2]

I think that it's better that they don't make any forecasts or targets and just focus on posting the best results possible. At the current rate, SN should be at least 30 millions in the black for 2015 by my estimates, 50 millions couting the subsidies.

The problem is that it's almost impossible to forecast until the last weeks of December, given razor thin margins and too many variables on the revenue side.

Most importantly, SN needs to keep the results steady in 2016, and try to take advantage of cheaper fuel, as this can improve the results by itself.

[airazurxtror]

Bernard Gustin : «Ce n’est pas le moment de se relâcher» Il faut encore réduire les coûts de 15%.
http://www.lesoir.be/986664/article/eco ... e-relacher

This is not the time to relax. We must further reduce costs by 15%.

[airazurxtror]

The problem is that it's almost impossible to forecast until the last weeks of December, given razor thin margins and too many variables on the revenue side.

They could at least give a tendency.
Last year, Bernard Gustin said to "Le Soir", on 24th september 2014 :
Bien que battant des records de fréquentation, la compagnie restera dans le rouge en 2014.
Although beating attendance records , the company will remain in the red in 2014.

[Inquirer]

They could at least give a tendency.

Given the summer has come to an end end their fiscal year coincides with a calendar year, I suppose they could do so indeed, but as was already mentioned: why would they bother doing so?

They are not a stocklisted company, so they have no obligation to communicate on this via any public channel AND they really seem to like the fact they can systematically take the market by surprise by underpromising and overdelivering from their underdog position; I wouldn't be surprised if they have noticed it wins them sympathy with ordinary consumers as well as goodwill with those that really matter over the past 2 years now, and are thus somewhat perfecting it even further this year.

I guess we'll just have to be patient and use circumstantial evidence as sort of guidance?
In this respect, the numerous hints that they will be expanding even more strongly next year (if true), are indicative to me they are having a very good year.

[sean1982]

They could at least give a tendency.

Given the summer has come to an end end their fiscal year coincides with a calendar year, I suppose they could do so indeed, but as was already mentioned: why would they bother doing so?

They are not a stocklisted company, so they have no obligation to communicate on this via any public channel AND they really seem to like the fact they can systematically take the market by surprise by underpromising and overdelivering from their underdog position; I wouldn't be surprised if they have noticed it wins them sympathy with ordinary consumers as well as goodwill with those that really matter over the past 2 years now, and are thus somewhat perfecting it even further this year.

I guess we'll just have to be patient and use circumstantial evidence as sort of guidance?
In this respect, the numerous hints that they will be expanding even more strongly next year (if true), are indicative to me they are having a very good year.

I'm sorry but if a "very good year" means they MIGHT get out of the red? That's not a very good year, that's maybe an "OK year." Some people here are raving about the amazing climb in passenger numbers, there's no denying they are spectacular. But a lot of passengers does not garantuee that they make money.

By phasing out the avro's and switching to Airbus the pressure to get more bums on the seats is increasing, which means tickets prices will lower, also because of increasing competition. SN and BRU have always been very unfortunate to have a star, one world and sky team HUB in their back garden on one side and some serious LCC competition on the other. Several airline ceo's are warning for a blood red winter in spite of low oil prices.

I've said it before and I'll say it again, dropping ticket prices, will need to be compensated elsewhere if you want to keep making money. Ancillary revenues will become a lot more important at SN and the cost base will have to drop (meaning employees). It's no wonder gustin said a couple of days ago he needs to drops base costs with 15%!

[Flanker2]

I agree that describing it as a very good year is like selling potatoes at the price of truffles.
A 30-50 million Euro profit at 3-5% gross margin over revenues is not really spectacular.
Many funds can guarantee you that ROI without a lick of risk.

Let's say that there is a positive shift and that the trends are encouraging.

Gustin and SN have shaved a lot in the past, so I don't see how they can shave another 15%, unless it's achieved through lower actual fuel prices.

Upsizing to larger aircraft still carries its risk. The whole world is currently experiencing a boom in air travel, but we all know from recent experiences (2001, 2008-2009) that things can become bitter very fast. This being said, I rather see SN operating A32S than Ejets or CS100. There's just no money to be made with these heavy RJ's. With cheap fuel and cheap Rubble, the SSJ's look really attractive, but production is so slow....