SAS Eyes More Cost Cuts As Q3 Profits Hit By Fuel Prices, Strike
Scandinavian airline SAS has said that it will look at additional cost-cutting measures beyond 2020 after reporting a drop in third-quarter earnings due to a pilot strike, high fuel prices and cut-price competition.
The carrier, partly owned by Sweden and Denmark, repeated that it will be challenging to reach a positive result before tax for the full year.
Third-quarter profit was dented by higher fuel costs, a weaker crown, and a pilot strike between April 26 and May 2, which led to the cancellation of 4,000 flights.
SAS said that it was partly compensated by increased passenger revenue, but added that costs were still too high.
"This means that we need to look at additional initiatives beyond 2020," it said.
Renewing Aging Fleet And Restructuring
Struggling with the rising cost of fuel and competition from the likes of Norwegian Air and Ryanair, SAS is renewing its aging fleet and has been restructuring for years to slash costs.
The airline's current efficiency improvement programme targets three billion crowns ($312.34 million) in savings by 2020.
SAS pre-tax profit was 1.49 billion crowns in the May-July period, down from 2.03 billion profit a year earlier. The average forecast, according to Refinitiv data based on two analysts, was for a pre-tax profit of 1.44 billion.