Icelandair achieved its strongest second-quarter results since 2016, driven by record passenger revenue, high load factor, and improved yields. Icelandair recorded a profit in the first half of the year citing lower fuel prices and increased efficiency from the Boeing 737 MAX.
The airline reported a profit of $13.7 million as compared to $3.8 million in Q2 of 2022 with an EBIT of $20.9 million, up by $19.6 million year-on-year. The airline reported a record operating income of $414.2 million with an increase of 26% year-on-year with a leasing revenue up by 41% resulting in strong profitability.
The airline carried about 2 million passengers in Q2 of 2023 with an increase of 19% than Q2 of 2022 with a capacity increase of 17% year-on-year. The airline load-factor remained strong at 83.6% due to demand from North American routes.
The airline reported strong operating cash flow resulting in highest ever liquidity position of $521.2 million.
Icelandair introduced five new destinations, acquired six new aircraft, carried 1.8 million passengers, and onboarded almost 1,200 employees.
Attributing the profits and success to company employees, Bogi Nils Bogason, president and chief executive, Icelandair said: “Thanks to the outstanding work of our employees, we are proud to deliver the strongest results in the second quarter since 2016. The prospects for the second half of the year remain favourable with continued strong bookings, particularly from North America. Our EBIT (Earnings Before Interest and Tax) margin forecast for the full year remains unchanged in the 4-6% range and we therefore expect to deliver net profit for the full year of 2023.”
Capacity at the airline’s hub of Keflavik International Airport has also increased sharply to 20% above 2019 levels this summer and will rise further into next winter.
The airline lost $8 million in additional costs, which led to slightly smaller profits for the period. This was due to delay in maintenance projects and arrival of incoming aircraft leading to aircraft shortage which the airline resolved by leasing additional aircraft in June for smooth running of operations.
Icelandair recently announced its next destination as Innsbruck, Austria with three weekly flights between January 27 and March 2, 2024.