Citi Analysts Call First Quarter The Worst Ever For European Carriers

Publicly listed European airlines lost an estimated combined €1.8 billion in the first quarter of 2009, compared with a profit of €100 million in the same quarter last year. The figures are the worst collective quarterly results ever for European carriers, according to an analysts' report on the sector from Citi.

Passenger numbers fell 8 percent during the period, and Citi does not expect any airlines at all in Europe to report a profit. The smallest losses are forecast to be at Lufthansa, Ryanair and Greek carrier Aegean Airlines. Citi believes only this trio and EasyJet will make a profit for full-year 2009. It predicts that SAS and British Airways will record the largest margins of loss for the first quarter. During that quarter, BA saw its premium traffic slump by 15.8 percent. "BA is particularly affected by its dependence on premium traffic and transatlantic markets," the report said.

The capacity offered by European airlines is expected to fall 3 percent this year in terms of available seat kilometers. Citi believes this does not go far enough and that capacity should be reduced 5 to 10 percent this winter.