Summary
- airBaltic achieved record-breaking revenue and profit leads to 2023.
- The Pratt & Whitney engine issues have impacted the airline’s operations in 2023 and can proceed 2024.
- Despite the challenges, airBaltic had strengthened its positions within the Baltics by increasing its market share in all three capitals’ airports.
airBaltic has announced its 2023 full-year results, announcing significant growth in all of its financial figures, including revenue, operating profit, and, most significantly, net profit, with the airline returning to full-year profitability since 2018.
Record-breaking financial figures
The airline’s chief executive officer (CEO) and President, Martin Gauss, identified that it reached its highest-ever revenue, earnings before interest, taxes, depreciation, amortization, restructuring or rent costs (EBITDAR), and net profit numbers.
In total, the Riga Airport (RIX)-based carrier earned €667.98 million ($724.7 million) of revenue, €100.7 million ($109.2 million) of which was earned through its aircraft, crew, maintenance, and insurance (ACMI) business, with the airline wet leasing its Airbus A220 aircraft to other airlines in Europe.
Photo: MBekir | Shutterstock
On average, the airline’s passengers paid €102.4 ($111.11) per ticket, 1% greater than in 2022, while on average, ancillary yields were €9.8 ($10.63) per traveler, excluding airBaltic’s ACMI metrics. While operating costs grew from €467.8 million ($507.6 million) to €583.9 million ($633.5 million), the whole revenues rising by 33% offset its costs’ growth, leading to a net profit of €33.6 million ($36.4 million).
Interestingly, while the airline carried 4.5 million passengers, coming up wanting its 2019 figure of 5 million travelers, including ACMI operations, airBaltic welcomed 6.9 million people onboard its aircraft through the yr, 28% greater than in 2019. As such, this has showcased how vital the ACMI business is for its operations.
![airBaltic Airbus A220 Taxiing In Sunny Conditions](https://static1.simpleflyingimages.com/wordpress/wp-content/uploads/2023/11/a220-300-airbaltic.jpg)
Flying High: airBaltic Records Best-Ever Nine-Month Revenue Figure
It has been all excellent news for the Latvian flag carrier this week!
Lingering Pratt & Whitney engine issues
Nonetheless, the airline’s results were dampened by the continual issues with its Pratt & Whitney PW1500G engines, which exclusively power its all-Airbus A220-300 fleet. Based on airBaltic, the issues, which began in 2022, continued throughout 2023 and are set to have an effect on its operations in 2024.
During 2023, the carrier wet leased other airlines’ aircraft, which also impacted the passenger experience, costs, and reduced load aspects, as airBaltic needed to welcome much larger aircraft than its A220-300s.
Photo: Tom Boon | Easy Flying
Moreover, Pauls Cālītis, the chief operations officer (COO) and a Board Member of airBaltic, remarked through the airline’s investors call that a brand new problem has appeared: the powdered metal issue, which has also affected PW1100G-powered A320neo family aircraft as well.
![A Hawaiian Airlines Airbus A321neo on the ground](https://static1.simpleflyingimages.com/wordpress/wp-content/uploads/2023/11/a-hawaiian-airlines-airbus-a321neo-on-the-ground-markus-mainka.jpg)
The Global Impact Of The Pratt & Whitney Engine Issues
The difficulty led to a $5.4 billion charge to RTX, parent company of Pratt & Whitney.
Consequently, Cālītis said that the airline may have a shortage of engines in 2024, an issue that has been exacerbated by a shortage of capability at maintenance, repair, and overhaul (MRO) organizations.
Strengthening its Baltics positions
In 2023, airBaltic welcomed seven A220-300 aircraft, ending the yr with 46 aircraft of the kind. Through the peak summer season, on average, nine A220-300s were on the bottom because of the PW1500G engine issues, with the carrier offsetting the capability shortage with seven wet-leased aircraft.
Photo: Michele Ursi | Shutterstock
Despite the capability issues, in addition to the closure of destinations to the east, namely Russia and Ukraine, the airline increased its market share at its key airports: RIX, Vilnius Airport (VNO), Tallinn Airport (TLL), and Tampere Airport (TMP). Now, the airline controls 56%, 13%, 26%, and 79% of the market on the airports, respectively.
In 2023, airBaltic announced the opening of a seasonal base in Gran Canaria Airport (LPA), which the airline’s management said would return to its network in 2024/2025. The carrier operated flights from LPA to the three Baltic States, in addition to Denmark, Finland, and Norway.
![airBaltic Airbus A220-300 in the Lithuanian flag livery](https://static1.simpleflyingimages.com/wordpress/wp-content/uploads/2024/01/airbaltic-airbus-a220-300-in-the-lithuanian-flag-livery.jpeg)
Lithuania In Discussions To Purchase Stake In airBaltic
The Lithuanian government is once more exploring options to accumulate a stake in airBaltic, the Latvia-based airline.