Aeroflot Group reported a 2019 1Q net loss of RUB15.7 billion ($242.5 million), deepened from a RUB11.5 billion loss in the year-ago period. The results are published according to International Financial Reporting Standards (IFRS).

Revenue for the quarter was RUB138.04 billion, up 23.3% year-over-year (YOY). Operating costs, excluding aircraft fuel costs, increased 23.6% to RUB100 billion; fuel costs were up 28.4% YOY to RUB43.7 billion.

Aeroflot Group includes Moscow Sheremetyevo-based Aeroflot Airline, St. Petersburg-based Rossiya Airlines, LCC Pobeda Airlines, and the Russian Far East-based Aurora Airlines.

“Market factors, including FX [foreign exchange] swings and fuel costs, remained significant for our results in comparison with the year-ago period. As in previous quarters, the most substantial influence on costs in 1Q 2019 was higher fuel expenses. The group’s total fuel costs increased by RUB9.7 billion, or 28.4%, as prices rose by 10.2% in ruble terms compared to the first quarter of 2018. The higher cost of jet fuel in the reporting period, despite a 5.4% decrease in Brent crude prices, was because of a 16.3% depreciation of the ruble against the US dollar compared to the year-ago period. CASK [cost per available seat kilometer] increased by 6.4%, because of currency movements as well as fuel costs,” Aeroflot deputy CEO Andrey Chikhanchin said in a statement.

“The winter season is traditionally the toughest time of year for the industry, as airlines continue to shoulder fixed costs while demand troughs as a result of the seasonality that can clearly be seen in passenger numbers. This seasonal effect, combined with the continued impact of fuel prices and stronger currency effects, were the reasons for the net loss for the reporting period of RUB15.7 billion,” Chikhanchin added.

In the first quarter, the group carried 12.8 million passengers, up 16.2% YOY. Domestic traffic grew 15.4% to 7 million; international traffic reached 5.7 million, up 17.2% YOY.

Polina Montag-Girmes