Aeroflot (MCX: AFLT) — one of the largest airlines in the Russian Federation in terms of passenger traffic, uniting?? air carriers "Aeroflot", "Russian Federation" and low-cost carrier "Victory".
22 On April 2021, the airline company made public its operating data for the 1st quarter of 2021. Let's take a look, how the company manages to recover its own business after a devastating fall amid the massive spread of the Covid-19 virus.
Position in the realm
2020 the year was one of the worst in the history of the global aviation industry. Passenger air transportation for the year fell by sixty-six percent due to the forced restriction of interstate flights by most states around the world. From April to July, the sky was actually closed for interstate flights..
The Russian Federation also suffered from the consequences of a severe epidemic, but was able to make up for part of the losses due to domestic air flights. The total passenger traffic went down to 52,5 %.
Aeroflot occupies approximately 43% according to the results of 2020. The total volume of passenger transportation decreased by fifty percent year-on-year, while passenger traffic on interstate lines fell by seventy-eight percent.
International passenger traffic of Aeroflot, million people
| 2016 | 43,4 |
| 2017 | 50,1 |
| 2018 | 55,7 |
| 2019 | 60,7 |
| 2020 | 30,2 |
2016
43,4
2017
50,1
2018
55,7
2019
60,7
2020
30,2
In April and May, passenger traffic decreased to virtually zero., recovered to August values in June due to the growth of domestic flights during the tourist season. Since that time, the level of passenger flow has been fixed at a low level..
The picture with interstate flights looks even worse, which actually ended in April-July last year after the introduction of restrictions. Then the restrictions began to loosen, and interstate flights on certain fronts were again resumed. But until now, the number of passengers every month, who fly on interstate lines, an order of magnitude less, than before the crisis.
As you can see on the chart, there is no talk about restoring the international flow of passengers to pre-crisis levels. Besides, the epidemiological situation in a large number of states remains tense. In April, India saw a surge in the incidence of the Covid-19 virus - more than 300,000 cases per day.
On the most popular tourist destination in the Russian Federation, in Turkey, the epidemiological situation has also worsened. The authorities have restricted air traffic from 15 April to 1 June 2021, and it is not yet clear, Will the bans be lifted after the expiration date?.
Operating indicators of Aeroflot
Total passenger traffic in the first quarter of 2021 decreased by 33% year on year — up to 7.37 million people. About 88%, or 6.47 million people, accounted for domestic flights - almost at the level of last year. At the same time, international passenger traffic fell by 80% — up to 0.9 million people.
Inside the company, only the low-cost airline Pobeda was able to demonstrate an increase in passenger traffic.. In a sense, he even benefited from the pandemic, as the ban on international flights stimulated domestic tourism.
Aeroflot passenger traffic in the first quarter, million people
| Interior | International | General | |
|---|---|---|---|
| 2017 | 5,72 | 4,58 | 10,3 |
| 2018 | 6,1 | 4,89 | 10,99 |
| 2019 | 7,03 | 5,73 | 12,76 |
| 2020 | 6,47 | 4,44 | 10,91 |
| 2021 | 6,47 | 0,9 | 7,37 |
Interior
2017
5,72
2018
6,1
2019
7,03
2020
6,47
2021
6,47
International
2017
4,58
2018
4,89
2019
5,73
2020
4,44
2021
0,9
General
2017
10,3
2018
10,99
2019
12,76
2020
10,91
2021
7,37
Aeroflot passenger turnover structure in the first quarter
| Aeroflot | 44,4% |
| "Victory" | 37,4% |
| "Russia" | 18,2% |
Aeroflot
44,4%
"Victory"
37,4%
"Russia"
18,2%
Passenger turnover showed similar dynamics.: internal remained at the level of last year's results, and the international collapsed more than 5 times - with 16,48 up to 3.07 million passenger-kilometres.
It is worth noting, that seat occupancy in the first quarter of 2021 was a record 80,1%, What's on 8,6 percentage point more quarter-on-quarter. This is due to an increase in seat occupancy on flights within Russia..
Aeroflot passenger turnover for the first quarter, million passenger-kilometers
| Interior | International | General | |
|---|---|---|---|
| 2017 | 10,40 | 16,53 | 26,93 |
| 2018 | 11,18 | 17,57 | 28,75 |
| 2019 | 12,98 | 20,57 | 33,55 |
| 2020 | 12,17 | 16,48 | 28,65 |
| 2021 | 12,17 | 3,07 | 15,24 |
Interior
2017
10,40
2018
11,18
2019
12,98
2020
12,17
2021
12,17
International
2017
16,53
2018
17,57
2019
20,57
2020
16,48
2021
3,07
General
2017
26,93
2018
28,75
2019
33,55
2020
28,65
2021
15,24
Total seat occupancy for the first quarter
| 2017 | 78% |
| 2018 | 78,5% |
| 2019 | 77,9% |
| 2020 | 71,5% |
| 2021 | 80,1% |
2017
78%
2018
78,5%
2019
77,9%
2020
71,5%
2021
80,1%
In addition to the transportation of passengers, the holding is engaged in air transportation of goods and mail within Russia and abroad.. The volume of cargo transportation decreased by 12,4% quarter by quarter - up to 62.2 thousand tons - due to the fall in international cargo transportation by 36,1%.
In the first quarter of 2021, the company performed 55.13 thousand flights, What's on 40,8% less, than the same period last year. The fall occurred not only on international lines - on 80,6% year to year, but also on the internal 16,1% year to year. Total fleet traffic in the park in the first quarter of 2021 decreased by 46,7% - up to 138.03 thousand hours.
Mass of transported goods for the first quarter, thousand tons
| 2017 | 57,18 |
| 2018 | 62,67 |
| 2019 | 64,99 |
| 2020 | 71,03 |
| 2021 | 62,21 |
2017
57,18
2018
62,67
2019
64,99
2020
71,03
2021
62,21
Number of Aeroflot flights in the first quarter, thousand flights
| Interior | International | General | |
|---|---|---|---|
| 2017 | 48,59 | 33,77 | 82,36 |
| 2018 | 51,67 | 36,87 | 88,54 |
| 2019 | 59,23 | 43,23 | 102,46 |
| 2020 | 57,48 | 35,65 | 93,13 |
| 2021 | 48,23 | 6,9 | 55,13 |
Interior
2017
48,59
2018
51,67
2019
59,23
2020
57,48
2021
48,23
International
2017
33,77
2018
36,87
2019
43,23
2020
35,65
2021
6,9
General
2017
82,36
2018
88,54
2019
102,46
2020
93,13
2021
55,13
First Quarter Park Raid, thousand hours
| 2017 | 224,96 |
| 2018 | 241,95 |
| 2019 | 283,53 |
| 2020 | 258,88 |
| 2021 | 138,03 |
2017
224,96
2018
241,95
2019
283,53
2020
258,88
2021
138,03
What's the bottom line?
The situation in the air travel industry depends on the speed of vaccination in Russia and abroad, with the subsequent lifting of restrictive measures.
Aeroflot Holding posted weak Q1 results due to last year's high base, when the effect of the pandemic and restrictions did not have time to come into full force.
Outside air traffic is recovering slowly, as the epidemiological situation in the world remains unstable. The devaluation of the ruble and the fall in people's incomes had an additional negative effect, which reduces the availability of international tourism.
The domestic air travel market has almost returned to pre-crisis levels, which is connected with the increase in air transportation by the Pobeda low-cost airline, which allows you to buy tickets at very affordable prices thanks to its business model.
