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The Canadian Press - ONLINE EDITION
Finnair Q4 loss widens to $43.3 million, in talks on joint Nordic venture
HELSINKI - Finnair PLC on Thursday reported that its losses deepened in the fourth quarter as it struggled against stiff competition and said it was seeking partners to form a joint venture in the Nordic region.
The loss of €32.6 million ($43.27 million) compared with a €6 million shortfall a year earlier. Net revenue in the period grew 12 per cent to €577.4 million, from €517 million a year earlier.
The Finnish airline announced plans to begin discussions on a joint venture "with potential partners" to expand the company's presence in the Nordic countries of Finland, Sweden, Denmark, Norway and Iceland.
It gave no details, but said the move was aimed at accelerating a policy to establish new bases in northern Europe.
"The potential joint venture would expand our home base to cover the entire Nordic region," CEO Mika Vehvilainen said. "For our customers, this would mean better connections and more opportunities to fly with Finnair ... (and) would also support our Asian strategy through increased feeder traffic for our Asian destinations."
Finnair has increasingly focused on destinations in Asia, where it saw huge growth until the March tsunami in Japan followed by a weakening of the global economy during the second half of 2011.
The airline saw 12 per cent revenue growth in the full year but profits continued to tumble as it was hit by high oil prices and increased competition from budget airlines.
Finnair said a "continuing uncertainty in the world economy," seasonal fluctuations and high fuel costs would hurt the company during the first half of the year, which was estimated to be "clearly loss-making."
But it predicted 5 per cent growth in passenger traffic in 2012, mainly on Asian destinations and said it expects to reach €80 million in savings by year-end of a total goal of €140 million.
Finnair stock was down 2 per cent at €2.58 ($3.42) in morning trading in Helsinki.
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