Portuguese airline TAP is profitable in the first half thanks to strong revenue growth

Portuguese airline TAP is profitable in the first half thanks to strong revenue growth

Portuguese airline TAP announced today, Wednesday, that it achieved a net profit of 23 million euros ($ 25 million) in the first half of 2023 thanks to strong revenue growth, supported by the tourism boom, and that it was expecting to perform well for the rest. of the year.

The unlisted public airline, which the government plans to partially privatize, incurred losses of 202 million euros in the same period of 2022.

It said its operating income jumped 44% to 1.9 billion euros year-on-year, driven by higher prices and capacity as travel demand returned strongly after coronavirus restrictions were lifted.

TAP’s recurring earnings before interest, tax, depreciation and amortization (EBITDA) jumped 57% to €361.7 million, and its EBITDA margin – a measure of profitability – increased to 19% from 17.4% a year earlier.

Chief Executive Officer Luis Rodrigues said the results showed the company’s continued trend towards commercial and financial improvement and that “the operating margins and deleveraging path, which exceeds the goals of the restructuring plan, prove the financial viability of the group.”

He noted that demand remained strong and bookings for the coming quarters had reached “significant levels, indicating an intense second half for which TAP is being prepared”.

The airline, which is being restructured under a €3.2 billion bailout approved by Brussels, said it carried 7.58 million passengers between January and June, up 30% from the previous year, but slightly below pre-pandemic levels.

The government wants to start the process of selling the company by October, but intends to keep a strategic stake. At least three major global airlines – IAG, Lufthansa and Air France-KLM – have so far expressed interest in TAP.

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($1 = 0.9204 euros)

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