TAP Air Portugal reported a net profit of €117.8 million ($135 million) in the third quarter of 2024, a decline of €62.8 million compared to the same period last year, citing foreign exchange losses as a significant factor. However, the airline’s third-quarter results marked a €116.6 million improvement compared to pre-pandemic levels in 2019.
Year-to-Date Performance
The airline carried 1.3% more passengers in the third quarter compared to the same period last year, despite a 1.9% drop in operated flights. Capacity, measured in available seat kilometers (ASK), increased by 1.2%, reaching 97% of pre-pandemic levels. The load factor improved to 86.2%, up 1.4 percentage points from last year and 3.3 points from 2019.
TAP’s operating revenue for the third quarter totaled €1.28 billion, a 2% increase from 2023 and 23% above pre-pandemic levels. Ticket revenue grew marginally by 0.5%, reaching €1.19 billion, while maintenance revenue rose by 48% due to heightened engine workshop activity. Cargo and mail revenue also increased by 8.6%, offsetting market-wide declines in cargo yields.
Recurring operating costs climbed by 6.4% to €1.05 billion, largely due to higher personnel expenses following new labor agreements, as well as increased depreciation and amortization costs. Recurring EBITDA for the quarter stood at €372 million, with a margin of 29%, reflecting a year-over-year decline of 4.8%.
Chief Executive Officer Luís Rodrigues acknowledged the quarter’s operational and financial challenges, citing currency devaluations and European air traffic management difficulties. Nevertheless, he highlighted the airline’s improvements in punctuality, customer satisfaction, and operational stability.
“We remain focused on transforming TAP into a sustainably profitable airline and one of the industry’s most attractive companies.”
In the first nine months of 2024, TAP reported a cumulative net income of €118.2 million, a decline of €85.3 million compared to the same period in 2023. Despite the year-over-year drop, the cumulative result represented a €229 million increase from 2019.
Operating revenue for the nine-month period reached €3.25 billion, up 2.8% from the previous year and 30.6% higher than in 2019. Capacity exceeded pre-crisis levels by 3%, while the load factor improved by 1 percentage point year-over-year to 82.9%.
Recurring operating costs rose by 4%, reflecting higher personnel and fuel expenses, while recurring EBITDA for the period totaled €744.8 million, with a margin of 22.9%.
TAP ended the third quarter with a liquidity position of €943.1 million, an increase of €153.7 million from the end of 2023. The airline also reported an improvement in its net financial debt-to-EBITDA ratio, which dropped to 2.3x from 2.6x at the close of last year.
Strategic Developments
TAP continues to expand its network, including the recent launch of routes from Lisbon to Florianopolis and Manaus, Brazil. The airline also added new aircraft to its fleet, increasing the share of fuel-efficient Airbus NEO family jets to 69% of its medium- and long-haul fleet.
Looking ahead, TAP forecasts stable fourth-quarter bookings and plans to optimize its financial structure following the successful issuance of €400 million in senior notes.
Rodrigues reiterated the airline’s commitment to modernization and its restructuring plan, which includes fleet upgrades and a focus on operational efficiency to strengthen its market position.
