• 

  SWISS

  IATA/ICAO Code:

  LX/SWR

  Airline Type:

  Full Service Carrier

  Hub(s):

  Zurich Airport

  Year Founded:

  2002

  Alliance:

  Star Alliance

  Airline Group:

  Lufthansa Group

  CEO:

  Dieter Vranckx

  Country:

  Switzerland

Today, Swiss International Air Lines announced it returned to profit in the first six months of 2022. The airline made an operating profit of CHF 67 million ($70 million) in the first half and is confident it will return to profit in its 2022 full-year results.

SWISS International Air Lines (SWISS) is part of the Lufthansa Group and a member of Star Alliance, the world's largest airline network. It operates to around 123 destinations in 51 countries, providing services on more than 140 routes. SWISS has its main base at Zurich Kloten Airport (ZRH) and, according to ch-aviation.com, has a fleet of 105 aircraft, including 15 Embraer ERJ 190s, which are wet-leased. Apart from 12 Boeing B777-300ERs, the fleet comprises only Airbus aircraft, including five 19-year-old A340-300s. The balance includes 30 Airbus A220s, 13 A320s, six A320neos, eight A321s, two A321neos, and 14 A330-300s.

Bookings have boomed in the last six months

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Increased passenger demand and bookings were the main reasons for the turnaround. The year started slowly due to lingering COVID effects, but SWISS said bookings began to grow during the first quarter when it carried 1.8 million passengers. However, the trend strengthened in Q2, and by June 30, the airline had carried 5.3 million passengers, five times as many as it carried in the same period last year.

The carrier operated more than 47,000 flights and increased capacity by 137% over H1 2021 in available-seat-kilometers (ASKs). Compared to H1 2021, revenue-passenger-kilometers (RPKs) rose by 422%, while the passenger load factor climbed 40% to 74%. SWISS chief financial officer Markus Binkert said the airline is delighted to be back in profit again, mainly as it is still operating at reduced capacity.

"The combination of substantial pent-up travel demand, higher ticket prices and our improved cost structures has had a very beneficial impact on our liquidity situation over the past few months. This also allowed us to terminate our bank loan facility which had been guaranteed by the Swiss Confederation ahead of time."

No gain without pain for SWISS staff

Growth without profitability is a road to nowhere, but SWISS has avoided that to deliver a CHF 67 million ($70 million) profit from revenues of CHF 1.8 billion ($1.88 billion). The depth of the recovery is remarkable, from H1 2021 revenues of CHF 659 million ($689 million) and a loss of CHF 398 million ($416 million). SWISS has gone through two years of strict financial measures or restructuring, which it says are now completed.

The measures included pay cuts and short-time work, although CEO Dieter Vranckx said that thanks to that restructuring, SWISS is today on solid financial foundations. He added, "With this stability, we can invest once again in our product, in further improving our customer services and our personnel and therefore retract the crisis response measures which we agreed with our employees in Switzerland earlier than planned."

Without giving any definitive guidance for the rest of the year, SWISS said booking levels look favorable for the rest of the summer season. It cautions on the threats from rising fuel prices, which it says will "remain high," industry-wide resource shortages, and a cooling-off in the economy. Despite that, the airline believes "its sound structure and cost base means it can look ahead with confidence to the second half-year." It sounds like it's running like a Swiss watch.