Russian carrier Aeroflot has experienced a net profits slump after it posted 2.8 billion roubles (approximately $$43 million) in its first quarter 2019 results, down from 28.4 billion in the same period last year.
The airline has blamed rising fuel costs which it states increased by 28.4% year-on-year to 43.7 million roubles. This was due to a 10.2% year-on-year increase in the average price of aircraft fuel in roubles amid changes in the price of oil, as well as an increase in flight numbers and flying time.
Excluding fuel costs, operating costs increased by 23.6% year-on-year.
Operating costs increased by 25.0% to 143.94 million roubles, primarily due to an increase in operations – capacities increased by 17.5% year-on-year.
The airline has said that it received a 13% increase in revenues to 504.7 billion roubles, which Aeroflot has attributed to a growth in operational results and currency fluctuations in the period.
Andrey Chikhanchin, PJSC Aeroflot deputy CEO for commerce and finance, said: "In the first quarter of 2019, Aeroflot Group continued to develop in line with the approved strategy. The group carried 12.8 million passengers, an increase of 16.2% year-on-year. Growth of passenger numbers and positive yield trends drove revenue higher by 23.3% to 138 billion roubles.
"Market factors including FX 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 the first quarter of 2019 was higher fuel costs.
"The group's total fuel costs increased by 9.7 billion roubles, or 28.4%, as prices rose by 10.2% in rouble 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 due to a 16.3% depreciation of the rouble against the US dollar compared to the year-ago period. CASK increased by 6.4%, due to currency movements as well as fuel costs.