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flightglobal.com/airlines | Airline Business | 25

SPECIAL REPORT WORLD AIRLINE RANKINGS

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The latest World Airline Rankings show that while the industry continued its recent profits run last year, much of this was driven by the strong performance of North American carriers after their restructuring. But fortunes differ widely among carriers across other regions and business models as competition remains intense

CONTENTS

26 Revenue reach A graphic snapshot of turnover share among the biggest carriers

28 Profits split Industry’s financial strength continues, but 2014 fortunes were mixed

36 Top airline groups by revenue Financial rankings for last year’s 100 biggest carriers

39 Airlines keep steady pace Global passenger traffic among the 150 leading carriers increased 6% last year

40 Top 150 passenger operations Our annual breakdown of the largest airlines by traffic, capacity and load factor

July-August 2015

All our special reports are available online at : flightglobal.com/airlines

flightglobal.com/airlines26 | Airline Business |

The latest World Airline Rankings show the 100 biggest airlines lifted revenues 2.6% to $704 billion in 2014. American Airlines, following its merger with US Airways, led the pack with $42.6 billion in group revenues last year. Between them the three US majors generated revenues of over $122 billion. This contributed to revenues of $219 billion among leading North American carriers last year, the biggest share of all the regions last year

WORLD AIRLINE RANKINGS REVENUE

REVENUE REACH

REPORTGRAHAM DUNN LONDON

July-August 2015

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$219bn

NorthAmerica

$32bn

LatinAmerica

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$43bn

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Regional revenue figures are from the top 100 airline groups

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flightglobal.com/airlines | Airline Business | 27July-August 2015

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$194bnEurope

$10bn

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KLM

IAG

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$52bn

MiddleEast

$197bn

Asia-Pacific

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$8bn

TOP 25 GROUPS BY REVENUE


NORTH AMERICA 2014 SNAPSHOT

Revenues: $219bnNet profits: $7.9bnOperating profits: $17.2bnStar performer: American Airlines – capped US Airways merger with record profitsWork in progress: JetBlue Airways - adding seats and revamped fares after missing 7% ROIC target in 2014Challenges: Capacity management as unit revenues have been falling; regulatory probe into capacity; Gulf subsidy row distraction

The latest rankings show the industry’s financial strength continued in 2014, supported by restructuring and lower fuel costs. But beyond North America, fortunes were mixed

WORLD AIRLINE RANKINGS OVERVIEW

PROFITS SPLIT

REPORTGRAHAM DUNNLONDONEDWARD RUSSELL & GHIM-LAY YEOWASHINGTON DCMAVIS TOHSINGAPORE

For an industry so used to shocks and red ink over the last 15 years, it is perhaps unsurprising that airlines may take some convincing that they’ve never had it so good.

This year’s Airline Business World Airline Rankings show that net profits among the leading 100 carriers reached $12 billion in 2014 and over $30 billion at an operating level. It marks the fifth consecutive collecitve net profit among leading carriers, and sixth year of operating profits. And with oil prices back at more pallatable levels, this is set to continue again, with IATA projecting record industry profits in 2015.

Yet the mixed nature of the business means that while many are thriving, others remain under pressure. For some, still gripped with restructuring, there is the possibility the peak of the economic cycle may come and go with-out them profiting from the good times.

LEADING LIGHTSWhile fortunes within regions – and in some cases, sectors – differ widely, there is no doubt North American carriers are leading the industry’s new found profits.

The region’s operators again prospered in 2014, as the World Airline Rankings show collective net profits for the leading American carriers of nearly $8 billion. Though this is below the $12 billion generated in 2013, that figure was distorted by Delta Air Lines’ $8 bil-lion one-off income tax gain.

July-August 2015

from the markets and, more literally from competition regulators after the US justice department revealed it is investigating the possibility of collusion between US airlines on domestic capacity growth.

Wall Street analysts were quick to criticise the move. As Jamie Baker, an analyst at JP Morgan noted in a 2 July report: “The impli-cation that airlines currently enjoy pricing power flies in the face of current data. Roughly 80% of fare increases we track have failed in recent years – so we can’t help but find humour in the suggestion of collusion.”

Indeed the markets of late have been more concerned about a lack of discipline. Gone are the days of near universal passenger unit rev-enue gains with “capacity discipline” the buzz words of the industry. Analysts now write of “capacity creep” and quarterly drops in unit revenues.

But no one is raising a red flag. US carriers are expected to continue to lead as the indus-try heads for record profits this year. Indeed, IATA in its June forecast further lifted net profit expectations for this year among North American carriers to $15.7 billion.

Wall Street analysts and rating agencies also still expect robust profits and margins from North American carriers in 2015 despite the weaknesses in the US market and capacity creep they have written so much about.

“Notwithstanding the current pressure on unit revenues in the US domestic market, markedly lower costs of jet fuel will more

Collective operating profits showed the gains more clearly, increasing $3.5 billion to top $17 billion in 2014. That contributed over half the profits of the top 100 carriers.

Much of this performance has been fuelled by consolidation and tight capacity disci-pline. The latter now is under scrutiny, both

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than outweigh the uninspiring trend in pas-senger revenue per available seat mile, result-ing in strong growth in earnings and free cash flow,” said Jonathan Root, a senior credit officer at Moody’s Investors Service, in com-mentary on the rating agency’s upgrade of United Airlines in June.

Moody’s also upgraded Delta Air Lines in June, citing low fuel prices among its various reasons for the credit rating change.

Brent crude prices stood at just under $60 per barrel in early July, US Energy Informa-tion Agency data shows. While that is nearly 10% higher than at the start of the year, it is still nearly half the level of a year ago.

Low oil prices will provide US airlines

with a windfall this year. Net savings could total up to $5 billion at American, $2 billion at Delta, about $1.7 billion at Southwest and, based on a back-of-an-envelope calculation, about $4 billion at United driving impressive cash flow and margin gains.

The airlines plan to use these savings to accelerate their respective capital deployment programmes – primarily reducing debt and returning cash to shareholders.

MIXED MESSAGESBut if the picture is consistent and clear in North America, it is anything but that across the rest of globe. Collective profits across the other regions are not only smaller by compari-

son, but there also are few consistent models of success. In short, what is working for one airline in one market may not for another in a neighbouring one. More than ever, there is no ‘one size fits all’.

Profits among leading European carriers improved slightly in 2014. Collective net prof-its were just over $2.1 billion, compared with roughly breakeven for the same carriers in 2013 – the difference virtually entirely accounted for by Air France-KLM almost wip-ing out the $2.4 billion lost in 2013. At an operating level, combined profits rose $300 million to $5.9 billion.

But the picture is mixed. Out of 24 Europan carriers, a third were in the red at an operating

The sharp drop in oil prices in the second half of 2014 was as unexpected as it was welcome for airlines. Most were resigned to high prices as the new norm and were planning accordingly.

Even with the barrel price of crude oil having picked up a little since dipping below the $50 mark early this year, at under $70 a barrel, pric-es remain significantly below 2014 levels.

This has helped drive airlines’ continued im-provement in underlying profits last year, and particularly so for this year. But while lower fuel prices equal reduced costs for airlines, they do not automatically translate to that.

This is partly because of hedging strategies most airlines are tied to, at least to some ex-tent, to take the edge off fuel pain when the oil price rises. Some airlines have initially had to take one-off charges to settle these.

Delta Air Lines for example took a $372 mil-lion charge in mark-to-market fuel hedge losses in the first quarter, but was still able to double profits in the quarter, aided by lower fuel prices.

Further complicating the potential fuel gains is the rapid strengthening of the US dollar against many currencies. This has had a big im-pact on costs paid for in US dollars for those

airlines in non US-dollar denominated carriers – and has further contributed to the split in for-tunes between the highly profitable North American operators and those in other regions. This mitigates the gains from lower fuel costs.

This also has an impact on the World Airline Rankings (see P36-38) which lists airline finan-cials in US dollars for comparison purposes, as the change versus 2013 is impacted by the stronger US dollar. As a result, for most airlines not reporting in US dollars, the comparison ver-sus 2013 in US dollars is less favourable than when reported in local currency.

FUEL GAIN, CURRENCY PAIN

$5.9bn

Europe

$0.2bn

Africa

$17.2bn

NorthAmerica

$1.7bn

LatinAmerica

$2.1bn

MiddleEast

$3.3bn

Asia-Pacific

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Regional figures are based on operating profits for the top 100 airlines



July-August 2015

CAPACITY CONCERNS

US carriers are expected to increase domestic capacity by about 5.5% to 6% in the second and third quarters, analysts estimate. This is at least 3 percentage points higher than The Wall Street Journal consensus forecast of a 2.6% increase in the economic activity.

“In 2015, domestically, capacity is going to be up 5%, 6% this year,” said Scott Kirby, president of American Airlines, in May. “GDP is going to grow much less than that [and] industry RASM [revenue per available seat mile] is going to be down, even domestically… I think most people define ‘capacity discipline’ as supply aligned with demand – it’s not aligned in 2015.”

Industry passenger revenue per available seat mile is expected to slip about 5% as a result of this mismatch in the second quarter. American forecasts a 6% to 8% drop in PRASM, Delta a 4% to 5% decrease and United a 5% to 6% fall compared with the same period a year ago.

The mismatch came as a bit of a surprise.“I think the fact is that we were all

somewhat surprised with the economic performance in the first quarter with a negative 0.7% GDP print,” said Delta president Ed Bastian at the start of June. The slowdown in economic activity has impacted close-in business bookings, he adds.

DEMANDING ATTENTIONUnited has seen a similar drop in demand related to the slower economic growth, its chief financial officer John Rainey said in June. In addition, the global drop in oil prices has proven to be a double-edged sword for the Star Alliance carrier as oil and gas industry bookings have dropped about 20%.

Southwest Airlines chief executive Gary Kelly says the carrier will stick to 7% capacity growth this year and plans to cap its growth next year at 6%. The move was welcomed by analysts who had attributed much of the domestic US capacity creep this year to the Southwest – the largest airline in the market.

Southwest is not along in tempering its capacity plans. But more cuts may still be needed. While airlines are trimming capacity growth, it remains well above the consensus estimate for US economic growth. “Growth generally is still too high,” says Hunter Keay, an analyst at Wolfe Research. “However, our sense is that Q2 will mark the peak for capacity and the trough for PRASM.”

level in 2014, and nearly half of leading Euro-pean carriers made a net loss.

The picture in Europe includes thriving network carrier IAG – where even long-strug-gling Iberia made a return to profit – a dis-tinctly mixed picture at Lufthansa and further losses at Air France-KLM.

Fortunes too are mixed among Europe’s second tier network operators, which largely remain in restructuring and cost-cutting mode. Several, however, have secured key investment aimed at securing their long-term sustainability. TAP Portugal, after David Neeleman’s Azul won the bidding in its recent privatisation, and IAG-bound Aer Lin-gus both appear to be in the process of joining the likes of Alitalia and Czech Airlines in securing fresh investors.

Many others hope to follow suit. The latest is Slovenia’s Adria Airways, whose privatisa-tion was formally launched at the start of July.

Still, the continued restructuring efforts at Air Berlin – which remains loss-making more than three years after Etihad’s investment – illustrates that attracting an investor is not in itself a panacea for airline ills.

Low-cost carriers in Europe are largely far-ing better. EasyJet and the revamped Ryanair are both profitably expanding, the latter see-ing big gains after following EasyJet into more

business-friendly operations. Vueling has remained profitable during its growth spurt, while Pegasus and Wizz Air both had success-ful market listings – shortly after which Wizz joined its low-cost peers in placing a big long-term fleet deal, covering up to 200 Airbus A320neos during the recent Paris air show.

Norwegian, which has faced additional costs and pain from the stalled approval for its ambitions to operate transatlantic flights through an Irish subsidiary, was the only one of the big European low-cost operators that was not profitable in 2014.

ASIAN ANGLEOperating profits reached $3.3 billion among leading Asia-Pacific carriers. While this is around $1 billion less than in the previous year, the figure is hugely distorted by the around $2 billion non-cash hit Qantas took in fleet write-downs. Likewise this dragged lead-ing Asia-Pacific carriers to a small net loss in 2014, compared with a profit of over $2 bil-lion in 2013.

That hit related to restructuring at Qantas, which has successfully turned round its for-tunes. The Oneworld carrier returned to the black in its first half and expects to post a profit in its financial year, which closed at the end of June. Its fellow hard-hit compatriot operator, Virgin Australia, also returned to profit in the first half.

There were more strong profits at Japanese pair All Nippon Airways and Japan Airlines, although another Japanese operator, Skymark Airlines, was forced into bankruptcy protec-tion earlier this year. Chinese carriers too helped drive Asia profits in 2014, with a nota-

ble improvement at an operating level.But as with Europe, there have been mixed

financial fortunes across Asia. The most high profile has been Malaysia Airlines, which has embarked on a major restructuring after a trau-matic 2014 and the tragic loss of two Boeing 777s. New chief Christoph Mueller confirmed the scale of the restructuring – which will cut around 30% of its 20,000 strong workforce – at the start of June, describing the airline as “tech-nically bankrupt”. The airline is hoping its restructuring will return it to profit by 2018.

“One of the catalysts is a more rational

market in Malaysia”TONY FERNANDES

Chief executive, AirAsia

EUROPE 2014 SNAPSHOTRevenues: $194bn Net profits: $2.1bnOperating profits: $5.9bnStar performer: IAG – profits topped $1.3 billion at both operating and net levels, and all three of its carriers were in the blackWork in progress: Air France-KLM – finished 2014 in the red, ameded plans for pan-Euro-pean Transavia operation and faces more work to implement labour savings targetChallenges: Industrial action has already impacted several carriers and further labour challenges await; region could face new round of economic uncertainty in the euro-zone as Greek debt crisis resurfaces

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But it was not alone in suffering. The politi-cal uncertainty during 2014 which damaged Thailand’s key tourism industry hit Thai Air-ways hard and prompted another year of loss and another change in chief executive. Garuda Indonesia too endured a difficult year.

The going was harder too for some of Asia’s low-cost operators. Following heady growth from the likes of Tigerair, AirAsia and Lion Air, most of the region’s budget carriers put the brakes on expansion in a bid to preserve yield and prevent an all-out bloodbath as seen in other markets. This has seen several carri-ers sell aircraft or defer planned deliveries.

AirAsia profits slipped in 2014, though it improved profit in the first quarter of this year. “One of the main catalysts is a more rational market in Malaysia,” said chief executive Tony Fernandes in May. “Airline operators in general are now a bit more disciplined in their capacity management, setting the stage for a better operating environment in 2015.”

But some of AirAsia’s units struggled, most notably long-haul operation AirAsia X, which racked up heavy losses in 2014 and saw the departure of long-serving chief executive Azran Osman-Rani.

The jockeying for position in the develop-ing low-cost markets through joint venture carriers – from both established budget brands and the network carriers – continues

with mixed success. While some have estab-lished themselves, others have failed or had false dawns, or in the case of still-blocked Qantas-China Eastern joint venture Jetstar Hong Kong, are still waiting for dawn.

LATIN LIMPINGLatin American carriers posted solid profits in 2014 at an operating level, but were at virtual breakeven at a net level after currency and fuel hedging losses at LATAM and Gol were factored in.

Gol’s challenges – last year marked its fourth consecutive net loss – have been com-pounded by Brazilian economic difficulties. But as Brazil is Latin America’s largest mar-ket, it has wider impact across the region.

The challenges in Brazil surpass those in other Latin American economies, which com-

July-August 2015


“We have to balance short-term problems

versus sustainability”CARSTEN SPOHR

Chief executive, Lufthansa

As European network carriers continue their restructuring efforts, labour relations for many are coming under further pressure.

Some have come through the pain. Lufthansa unit Austrian for example last autumn reached settlement with employee representatives, following an acrimonious dispute since 2012, when Austrian transferred all flying staff members to its lower-cost regional unit Tyrolean Airways. Its parent Lufthansa say the restructuring should create “significant” savings from next year.

Aer Lingus too hopes to secure planned cost-efficiences after resolving its long-running pensions dispute with unions.

Others though continue to face pressure with labour, whether it be in securing new labour terms or through industrial action.

TESTING TIMESLufthansa continues to face some of the most testing labour relations as it attempts to reach terms for new collective labour deals. “What we have to do is balance short-term problems for our customer, for our operations, for our image, versus long-term sustainability of our structure,” chief executive Carsten Spohr told Airline Business last October, as the carrier battled a run of pilot stoppages. “It is necessary to make

these restructurings. I think there is no room for wrong compromises.”

Its pilots have just broken off a temproary truce after arbitration failed to broker a deal in the long-running dispute. Meanwhile a strike threat from its cabin crew, has been put on ice, as talks on a new deal continue.

Lufthansa too has identified a pensions issue and is calling on unions to accept “urgent” changes to its company pension scheme as low interest rates inflate the existing system’s deficit.

“More urgently than ever, we need sustainably financeable solutions in place of obsolete [pension] structures. We can only achieve this together with our collective bargaining partners,” says its finance chief Simone Menne.

Air France-KLM has also faced its share of labour pain. Having been forced to drop plans for a pan-European Transavia operation to put an end to a damaging pilots strike last year, its frustrations are growing in its attempts to secure the labour cost savings envisaged under its Perform 2020 programme.

Not that their low-cost rivals have not suffered. Norwegian was hit by a pilots strike in March, while Ryanair has dropped it news Copenhagen base after a Danish court ruling allowed local unions to call industrial action.

EUROPEAN HARD LABOUR

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bined have led to largely lacklustre showings by the region’s carriers in the first quarter. Latin American airline group Avianca saw weakness in its domestic Colombian market, with chief executive Fabio Villegas calling the market conditions “very challenging”. Domestic traffic growth in Ecuador and Peru – where Avianca operates carriers – failed to outpace capacity growth in the first quarter.

IATA in its June forecast scaled back its projections for Latin American carrier profits in 2015. While the $600 million profit Latin American carriers are set to make this year is an improvement on the breakeven perfor-mance of 2014, it is almost half the level IATA was projecting six months ago.

“Latin America is a fascinating region of many contrasts,” says IATA chief economist Brian Pearce. “There are some growth hot-spots, economies like Colombia and Chile are doing really well, but Brazil is such an impor-


July-August 2015

“Other markets are soft, but in Brazil we are

seeing the biggest impact”PEDRO HEILBRON

Chief executive, Copa Airlines

tant economy that it is affecting performance. That clearly will affect the performance of air-lines that are exposed to that market.”

Latin America’s airlines also continued to bear the burden of the hold-up in revenues in Venezuela, which has yet to repatriate $3.7 billion owed to foreign airlines. Airlines have mostly stopped selling tickets in bolivares to minimise the build-up of the depreciated cur-rency in the South American country, and have been working to spend their bolivares at their Venezuelan operations.

GLOBAL GULFThe big Gulf carriers continue to dominate the global landscape. It means interest in the financial performance of Emirates, Etihad and Qatar Airways, engulfed in a very public row over subsidies with the big three US majors, is keener than ever.

Emirates Group lifted operating profits by nearly $500 million in the last year to top $1.8 billion. The newer Etihad Airways pointed to another year in the black with improved oper-ating and net profits. While Qatar Airways has not formally released its financial results, its chief executive Akbar Al Baker told the Wall Street Journal in June that the airline made a profit of just over $100 million in its

Continued weakness in Latin America’s biggest market of Brazil will likely keep the region’s chief executives awake in the coming months, although some are holding out hope that there is light at the end of the tunnel.

“We are looking at slow growth in the economy in Brazil,” LATAM Airlines Group’s chief executive Enrique Cueto told Airline Business on the sidelines of the recent IATA AGM in Miami.

Slow growth could perhaps be an understatement, with Brazil announcing even more bad news in the last month. Its central bank in late June said GDP for 2015 is expected to fall 1.1% in 2015 – widening from the previously forecast 0.5% drop.

YIELDING CHANGEThe economic weakness in the country has impacted airline yields as corporate travellers stay home.

LATAM’s Brazilian subsidiary TAM saw corporate travel demand decline right from around the time of last summer’s football World Cup in Brazil, and the level has yet to

recover. TAM’s chief executive Claudia Sender said in May that the airline expects corporate demand to pick up in the second half of 2015, but also acknowledged it is not clear when this might be.

Gol chief executive Paulo Kakinoff, however, believes that the decline might have bottomed out. “We can’t go worse than we are right now,” he said in May.

Both TAM and Gol – Brazil’s two biggest carriers – plan to keep domestic capacity flat this year. Other carriers have taken action to slash supply in the country. Panama’s Copa Airlines is cutting capacity to Brazil by about 4% in the second half of 2015, which will reverse all the new capacity the carrier added a year ago.

“Brazil is the weakest right now,” says Copa Airlines chief executive Pedro Heilbron. Copa has about a fifth of its capacity in Brazil. In the first quarter, Copa’s yields in Brazil fell 15%. “Other markets are soft but in Brazil, by far, we are seeing the biggest impact,” Heilbron had said in May.

A significantly depreciated Brazilian real

has hit the region’s bottom lines hard. Both TAM and Gol each sustained hundreds of millions in foreign exchange losses. Gol sustained a first quarter net loss of R673 million ($215 million), making it the worst performer among its peers in the Latin American region. Kakinoff said the airline would have been profitable but for the foreign exchange losses.

The weakness in Brazil’s macroeconomic environment has led to uncertainty over the country’s regional aviation ambitions. Brazil has in recent years championed plans to subsidise airlines for the purchase of regional aircraft to grow the vast country’s regional network – a move that has led to both TAM and Gol expressing interest in regional jets.

But Brazil’s airline chiefs recently expressed doubt that the government – already struggling with a budget deficit – will dole out such incentives to the carriers and appear to have put their plans on hold. “There is no way to come up with the subsidies,” said Avianca Brazil’s owner German Efromovich in June.

BRAZIL WOES DRAG LATIN RESULTS

ASIA-PACIFIC 2014 SNAPSHOTRevenues: $197bnNet loss: $58mOperating profits: $3.3bnStar performer: Japan Airlines – its profit run continues unabated since bankruptcy re-structuring, making it the region’s most profit-able carrier in 2014Work in progress: Malaysia Airlines – after tumultuous and tragic 2014, the revamped carrier has begun work on massive restructur-ing programmeChallenges: Cargo yields continue to strug-gle; overcapacity in some markets has hit yields; weakness in Chinese economy would hit wider region’s fortunes

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last financial year.This does little to change the ongoing argu-

ments, as the big Gulf carriers point to profit-able operations and sceptics ask for more transparency. But what is not in doubt is the rate of growth of all three carriers, demon-strated again by another sharp rise in passen-ger numbers in 2014.

Emirates carried almost 50 million passen-gers last year, an increase of 10%; Qatar flew 15% more at 22 million, and Etihad increased passenger numbers by more than a fifth to over 15 million. All three now rank in the 25 biggest carriers by RPKs.

While the Gulf carriers take the spotlight, efforts to turn around losses in the region con-tinue. Royal Jordanian, which cited political unrest as a contributing factor to deeper losses in 2014, managed to cut its first quarter losses. While full figures are not available for Gulf Air, ministers have said its losses were cut in 2014 and will be again this year. Oman Air sees growth and economies of scale as key to its path to profitability by 2017.

It remains a difficult market in North Africa. Attempts to rebuild tourism activity in the region after the unrest that followed the Arab Spring continue to be hit by security set-backs, evident again in Tunisia recently.

Royal Air Maroc appears best set of the local carriers, having already had to adjust to increased competition through open skies with Europe. The carrier, which took delivery of its first Boeing 787 earlier this year, was on

course to generate operating profits in 2014 on a similar level to the DM789 million ($80 mil-lion) it recorded in 2013.

Elsewhere in Africa it remains challenging for local carriers, not helped by regional unrest in some parts and the fallout from the damaging ebola outbreak. Ethiopian Airlines is continuing to expand profitably, but South African Airways and Kenya Airways, find themselves battling for profitability.

For SAA – and Nico Bezuidenhout who is reprising his acting chief executive role after more boardroom tensions - this is familiar ter-ritory. He has successfully implemented a 90-day action plan which has helped to secure shareholding backing, The wide-rang-

July-August 2015

“All we have done is put SAA back on track with

its long-term turnaround”NICO BEZUIDENHOUT

Acting CEO, South African Airways

ing plan included a raft of cost-savings intia-tivs and an overhual of it network. He says: “All that we have done is to put SAA back on track with its long-term turnaround strategy.”

For Kenya Airways, which had enjoyed a sustained run of profits, losses of recent years are less familiar. The SkyTeam carrier is still to publish its 2014 results, but indicated at the halfway point that a “very challenging business environment” over the first six

months of the year, continuing from last year, would mean another year of losses.

Meanwhile, emerging pan-African low-cost carriers, the most high profile of which is Fastjet, are making slow progress in rolling out their model across different countries. ■

China Airlines knows what it’s like to be a victim of the cargo slump. Over the last four years, the carrier recorded annual cargo losses of NT$4-5 billion ($130-164 million), a major blow since cargo accounts for 30% of its total revenue.

But the Taiwanese airline believes the worst is over, and things are finally looking up for the cargo sector. “This year’s cargo market will be better than last year’s,” China Airlines chairman Huang-Hsiang Sun says.

Over the first four months of 2015, the carrier’s cargo revenue grew 10.7%. Traffic outpaced the 6% extra capacity, resulting in a two point climb in load factor. Yields, however, saw a mere 1% uptick.

FREIGHT FREEZEChina Airlines has not been alone. While passenger traffic have recovered since the 2009 global financial crisis, air cargo traffic has remained in the doldrums over the last four years. Asia-Pacific carriers, accounting for about 40% of the global air cargo market, have been disproportionately impacted by the sector’s weakness.

IATA believes there will be “continued downward pressure” on yields in 2015, but this will be mitigated by lower jet fuel prices – helping to improved cargo profitability.

Andrew Herdman, director general of the Association of Asia-Pacific Airlines says, “there is some optimism” since growth in cargo volumes has sustained from 2014 through to 2015, despite the slower economic growth in Asia and concerns about the global economy. “That’s reasonably positive,” he says. “Cargo volumes may pick up, but when will cargo revenues pick up and when will freighters become profitable again?”

Herdman adds “latent capacity” overhangs the market, and that even as cargo volumes pick up, operators will pump capacity back in,

which will only keep rates competitive.China Airlines, for example, has three

Boeing 747-400Fs parked in Californian deserts, but will return one of these to service in August. Should demand pick up further, the SkyTeam carrier will reactivate the other two.

Flightglobal’s Ascend Fleets database shows that Asia-Pacific carriers have 25 widebody freighters in storage.

IATA expects capacity discipline to remain a challenge in 2015, where for every 1t of hull capacity added by a widebody freighter, 3t will be added by widebody passenger aircraft.

In its first quarter overview of the cargo industry, IATA said overcapacity has resulted in lower load factors and downward pressure on yields. It does not expect lower fuel prices to have any lasting impact on cargo profitability.

SIA Cargo attributed the narrowing of its operating loss to S$22 million last year to a “moderate recovery” in air cargo demand and diligent capacity management. “We certainly are seeing a general pick-up in demand, however the yields are somewhat challenged,” says Ng Chin Hwee, chairman of SIA Cargo. He explains that there is currently “a lot of excess capacity”, and airlines, seeing the benefits of low fuel prices, are also putting more aircraft out into the market.

Ascend’s head of market analysis Chris Seymour points to some swings in cargo traffic at Asian airlines and airports so far in 2015, linked to the Chinese new year, US port strike, end of quarter manufacturing rush and issues with eurozone and currency depreciation. “So an overall cautious picture at the moment for 2015,” he says.

Looking ahead, IATA says the robust trend for Asia-Pacific cargo could come under pressure from weakness in regional trade volumes, which appears to be reversing after strong gains in late 2014.

ASIA SUFFERS FROM CARGO HOLDS

For more details on airline 2014 financial results visitflightglobal.com/dashboard


WORLD AIRLINE RANKINGS FINANCIAL

ANALYSIS BY FLIGHTGLOBAL INSIGHT DATA COMPILED BY SILVA ISHAK FLIGHTGLOBAL DATA RESEARCH

July-August 2015

TOP AIRLINE GROUPS RANKED BY REVENUES 2014: 1 TO 50

Ranking Group/Airline Country Revenues Change (%) Operating result ($m) Operating margin (%)2014 (2013) ($m) Local In US$ 2014 2013 2014 2013

1 (1) American Airlines Group USA 42,650 5.5 4,249 2,579 10.0 6.4 2 (4) Delta Air Lines USA 40,362 6.9 2,206 3,400 5.5 9.0 3 (2) Lufthansa Group Germany 39,558 -0.1 -0.9 1,258 929 3.2 2.3 4 (3) United-Continental Holdings USA 38,901 1.6 2,373 1,249 6.1 3.3 5 (5) Air France-KLM Group France 32,861 -2.4 -3.2 -170 173 -0.5 0.5 6 (6) FedEx USA 27,239 0.4 1,584 1,428 5.8 5.3 7 (7) IAG UK 26,587 8.6 7.7 1,356 701 5.1 2.8 8 (8) Emirates Group UAE 26,262 9.9 9.9 1,878 1,395 7.2 5.8 9 (9) Southwest Airlines USA 18,605 5.1 2,225 1,278 12.0 7.2 10 (11) China Southern Air Holding China 17,596 10.2 9.7 769 246 4.4 1.5 11 (12) Air China China 17,158 7.8 7.3 1,177 671 6.9 4.2 12 (13) ANA Group Japan 15,465 9.1 -1.0 826 657 5.3 4.2 13 (14) China Eastern Airlines China 15,211 3.2 2.7 982 257 6.5 1.7 14 (10) Qantas Group Australia 14,018 -3.5 -13.6 -3,444 202 -24.6 1.2 15 (17) Cathay Pacific Group Hong Kong 13,666 5.5 5.5 572 485 4.2 3.7 16 (15) LATAM Airlines Group Chile 12,471 -6.0 513 644 4.1 4.9 17 (16) Japan Airlines Japan 12,137 2.7 -6.9 1,622 1,660 13.4 12.7 18 (18) Singapore Airlines Group Singapore 12,027 2.1 -0.5 316 206 2.6 1.7 19 (19) Air Canada Canada 11,978 7.2 0.1 736 598 6.1 5.0 20 (21) Turkish Airlines Turkey 11,070 28.1 12.7 603 577 5.4 5.9 21 (20) Korean Air South Korea 11,064 -0.3 3.5 353 -16 3.2 -0.2 22 (23) Qatar Airways Group Qatar 9,388 11.6 23 (22) Aeroflot Russia 8,092 9.9 -10.9 285 618 3.5 6.8 24 (28) Etihad Airways UAE 7,600 26.7 257 194 3.4 3.2 25 (26) EasyJet UK 7,516 6.3 13.1 965 776 12.8 11.7 26 (25) Ryanair Ireland 7,050 12.3 4.2 1,300 884 18.4 13.1 27 (24) Thai Airways International Thailand 5,877 -9.6 -14.3 -223 -3.2 28 (32) Hainan Airlines Group China 5,841 8.3 7.8 405 373 6.9 6.9 29 (31) JetBlue Airways USA 5,817 6.9 515 428 8.9 7.9 30 (29) UPS Airlines USA 5,814 0.3 328 337 5.6 5.8 31 (33) Saudia est Saudi Arabia 5,800 7.4 32 (27) SAS Group Sweden 5,646 -9.9 -12.6 23 398 0.4 6.2 33 (34) Asiana Airlines South Korea 5,529 2.0 5.9 93 -10 1.7 -0.2 34 (30) Air Berlin Germany 5,484 0.3 -0.5 -387 -308 -7.1 -5.6 35 (35) Alaska Air Group USA 5,368 4.1 962 838 17.9 16.3 36 (37) Virgin Group UK 4,769 -3.7 1.2 24 -80 0.5 -1.7 37 (38) Avianca Holdings Colombia 4,702 9.4 2.0 285 385 6.1 8.3 38 (40) China Airlines Taiwan 4,599 6.1 3.8 -60 -1.3 39 (36) Malaysia Airlines Malaysia 4,465 -4.1 -7.4 -374 -93 -8.4 -1.9 40 (41) Gol Transportes Aereos Brazil 4,262 12.4 3.8 214 122 5.0 3.0 41 (39) Alitalia est Italy 4,200 -5.9 -6.7 -320 -7.1 42 (44) Garuda Indonesia Indonesia 3,934 17.5 4.7 -399 63 -10.1 1.7 43 (42) Virgin Australia Australia 3,932 7.1 -4.1 -345 -101 -8.8 -2.5 44 (43) Air New Zealand Group New Zealand 3,868 1.0 2.3 334 253 8.6 6.7 45 (45) EVA Air Taiwan 3,848 5.6 3.4 21 53 0.5 1.4 46 (47) WestJet Canada 3,589 8.6 1.4 429 386 12.0 10.9 47 (50) Air India est India 3,500 9.2 8.4 -349 -10.8 48 (55) Jet Airways India 3,307 14.5 13.6 -28 -320 -0.8 -11.0 49 (46) TAP Portugal Portugal 3,282 -7.5 4.3 -61 59 -1.6 1.7 50 (49) SkyWest, Inc USA 3,237 -1.8 25 153 0.8 4.6 NOTES: est Airline Business estimates used where full-year figures are unavailable to give an indication of the airline’s revenue ranking. See P38 for methodology

TOP AIRLINE GROUPS BY REVENUE


Net result ($m) Net margin (%) Mainline operating revenues (%) Period Notes2014 2013 2014 2013 Passenger share Cargo share to end:

2,882 -1,233 6.8 -3.1 87.0 2.1 Dec 14659 10,540 1.6 27.9 86.6 2.3 Dec 1473 416 0.2 1.0 71.9 9.4 Dec 14

1,132 571 2.9 1.5 86.8 2.4 Dec 14-249 -2,417 -0.8 -7.1 78.5 10.8 Dec 14

100.0 May 15 FedEx Express segment1,322 195 5.0 0.8 88.4 4.9 Dec 14 Includes Vueling since 26 April 20131,487 1,112 5.7 4.7 Mar 151,136 754 6.1 4.3 94.9 0.9 Dec 14

389 448 2.2 2.8 89.5 6.6 Dec 14694 589 4.0 3.7 87.5 8.3 Dec 14354 188 2.3 1.2 67.2 9.7 Mar 15574 341 3.8 2.3 80.2 7.8 Dec 14

-2,596 2 -18.5 86.3 6.2 Jun 14406 338 3.0 2.6 71.5 24.0 Dec 14-110 -281 -0.9 -2.1 83.2 13.7 Dec 14

1,345 1,654 11.1 12.7 70.1 6.3 Mar 15284 285 2.4 2.4 Mar 1595 10 0.8 0.1 88.9 3.8 Dec 14

845 357 7.6 3.6 89.1 8.8 Dec 14-195 -266 -1.8 -2.5 60.0 24.5 Dec 14

76.9 14.9 Mar 15-434 229 -5.4 2.5 84.0 2.7 Dec 14

73 48 1.0 0.8 14.6 Dec 14747 621 9.9 9.3 98.6 Sep 14

1,081 702 15.3 10.4 75.3 Mar 15-479 -389 -8.1 -5.7 81.0 12.3 Dec 14428 354 7.3 6.5 87.3 2.5 Dec 14401 168 6.9 3.1 91.9 Dec 14

-2 83 0.0 1.4 98.1 Dec 14Dec 14 Airline Business estimate

-107 208 -1.9 3.2 75.5 3.4 Oct 1460 -105 1.1 -2.0 Dec 14

-497 -419 -9.1 -7.6 91.5 Dec 14605 508 11.3 9.9 85.3 2.1 Dec 14

7.6 Dec 14121 249 2.6 5.4 82.3 17.7 Dec 14

-43 -1.0 65.1 30.9 Dec 14-514 -248 -11.5 -5.1 Sep 14-473 -332 -11.1 -8.1 89.9 Dec 14

-530 -11.8 Dec 14 Airline Business estimate-372 14 -9.5 0.4 84.9 5.8 Dec 14-325 -100 -8.3 -2.4 Jun 14 Includes Virgin Australia Regional, formerly Skywest217 148 5.6 3.9 82.6 6.2 Jun 14-64 16 -1.7 0.4 66.7 26.7 Dec 14

256 260 7.1 7.3 90.5 Dec 14 -885 -27.4 Mar 15 Airline Business estimate

-296 -603 -8.9 -20.7 Mar 15-112 -8 -3.0 -0.2 Dec 14-24 59 -0.7 1.8 97.9 Dec 14


WORLD AIRLINE RANKINGS FINANCIAL

July-August 2015

TOP AIRLINE GROUPS RANKED BY REVENUES 2014: 51 TO 100

Ranking Group/Airline Country Revenues Change (%) Op result ($m) Op margin (%) Net result ($m) Period Notes2014 (2013) $ million In US$ 2014 2014 2013 2014 2013 to end:

51 (52) Grupo Aeromexico Mexico 3,211 3.7 126 3.9 6.0 59 84 Dec 1452 (53) Thomson Airways UK 3,179 4.1 503 15.8 11.7 467 301 Sep 1453 (56) Norwegian Norway 3,066 16.4 -221 -7.2 6.2 -165 54 Dec 1454 (51) Finnair Finland 3,011 -5.6 -96 -3.2 0.3 -109 30 Dec 1455 (48) Transaero Airlines Russia 2,969 -13.3 -7 -0.2 -11.3 -495 -514 Dec 1456 (58) Sichuan Airlines China 2,763 7.1 56 86 Dec 1457 (57) Copa Holdings Panama 2,722 4.4 538 19.8 19.8 371 428 Dec 1458 (54) South African Airways est South Africa 2,650 -10.7 -7.6 -251 Mar 15 Airline Business estimate58 (59) Vietnam Airlines est Vietnam 2,650 3.2 0.3 7 Dec 14 Airline Business estimate60 (64) Ethiopian Airlines Ethiopia 2,457 14.2 195 7.9 7.2 166 115 Jun 1461 (60) Azul est Brazil 2,450 2.0 7.4 29 Dec 14 Airline Business estimate62 (66) IndiGo est India 2,400 14.3 9.5 200 Mar 15 Airline Business estimate63 (67) Air Europa Spain 2,344 12.3 40 1.7 4.2 22 61 Oct 1464 (63) Hawaiian Airlines USA 2,315 7.4 245 10.6 6.2 69 52 Dec 1465 (61) Air Transat est Canada 2,300 -4.2 Oct 14 Airline Business estimate66 (75) Philippine Airlines Philippines 2,270 30.2 53 2.3 -8.7 3 -299 Dec 1467 (68) Condor Germany 2,157 5.4 83 3.8 3.7 Sep 1468 (70) Cargolux Luxembourg 2,155 8.3 31 1.4 3.0 3 8 Dec 1469 (65) El Al Israel 2,081 -1.0 -4 -0.2 1.9 -28 27 Dec 1470 (73) Aer Lingus Ireland 2,052 8.3 95 4.6 4.3 -126 45 Dec 1471 (69) Aerolineas Argentinas est Argentina 2,000 -1.8 -12.3 -247 Dec 14 Airline Business estimate72 (71) Egyptair est Egypt 1,950 -1.5 Jun 14 Airline Business estimate73 (79) Spirit Airlines USA 1,932 16.8 355 18.4 17.1 226 177 Dec 1474 (74) Shangong Airlines China 1,875 0.8 33 1.8 2.4 47 64 Dec 14=75 (77) Thomas Cook Airlines est UK 1,800 7.0 6.6 124 Sep 14 Airline Business estimate=75 (83) Royal Air Maroc Morocco 1,800 13.8 74 4.1 5.9 Oct 1477 (78) Atlas Air Worldwide USA 1,799 8.6 176 9.8 11.3 102 94 Dec 1478 (62) UTair Group Russia 1,796 -21.9 -251 -14.0 1.5 -564 10 Dec 1479 (72) S7 Airlines Russia 1,789 -8.7 22 22 Dec 1480 (76) AirAsia Malaysia 1,719 1.2 260 15.1 17.0 25 114 Dec 14

81 (82) Lion Air est Indonesia 1,700 6.2 Dec 14 Airline Business estimate

82 (85) SunExpress Turkey 1,648 15.0 Dec 1483 (80) Volga-Dnepr Group Russia 1,606 -2.5 22 1.4 1.6 13 4 Dec 14=84 (84) Brussels Airlines est1 Belgium 1,575 4.1 -12 -0.8 -2.5 -6 -29 Dec 14 Revenue is estimated=84 (88) Frontier Airlines USA 1,575 16.8 210 13.3 3.8 129 77 Dec 14 US DOT86 (87) Wizz Air Hungary 1,530 12.6 209 13.6 10.8 228 118 Mar 1587 (81) Jazz Canada 1,504 -6.9 125 8.3 7.4 58 60 Dec 1488 (86) Virgin America USA 1,490 4.6 96 6.5 5.7 60 10 Dec 1489 (90) Pegasus Turkey 1,444 16.0 148 10.3 10.8 65 46 Dec 1490 (89) Republic Airways Holdings USA 1,375 2.2 186 13.5 14.2 64 27 Dec 1491 (92) Monarch Airlines est UK 1,300 8.5 0.6 1 Oct 14 Airline Business estimate92 (98) Tianjin Airlines China 1,245 18.2 41 34 Dec 1493 (91) Kenya Airways est Kenya 1,230 -0.1 -2.6 -39 Mar 15 Airline Business estimate

94 (93) Aegean Airlines Group* Greece 1,202 6.4 140 11.6 9.0 106 70 Dec 14 2013 proforma95 (102) Flydubai UAE 1,198 19.0 68 61 Dec 1496 (96) Spring Airlines China 1,182 11.0 87 7.3 6.7 143 119 Dec 1497 (109) Cebu Pacific Air Philippines 1,169 21.5 94 8.0 5.9 19 12 Dec 1498 (104) Allegiant Air USA 1,137 14.2 157 13.8 15.5 86 92 Dec 14=99 (99) Jet2 est UK 1,125 9.8 4.0 26 Mar 15 Airline Business estimate=99 (95) Pakistan Int’l Airlines Pakistan 1,125 4.5 -128 -11.4 -27.3 -304 -442 Dec 14NOTE: est Airline Business estimates have been used where full-year figures are unavailable to give an indication of the airline’s revenue ranking. Volga Dnepr includes AirBridge Cargo and ATRAN; Republic sold Frontier Airlines to Indigo Partners in December 2013; Aegean includes Olympic Air on a pro-forma basis;

NOTES: Revenues are consolidated figures for groups, including contributions from subsidiaries and non-airline operations. However, for broad freight or travel operations, results have been given for the airline division only. All revenues are translated into US$ at the average annual rate for the given financial year. Where there has been strong movement between local currency and the US dollar there is a big difference in the change figure; Operating result is generally taken as the profit or loss from operations after normal expenses including depreciation, but before finance charges, exceptional items and tax. Net result is after all costs and exceptional items and contributions from subsidiaries. In some cases these may include sizeable gains or losses from exceptional items; Operating and net margins show profits or losses as a percentage of revenues allowing comparisons between the performance of different groups. However, differences in national accounting standards mean that direct comparisons should be handled with caution; Results are over the latest financial year to the end of the month shown. Returns from mid-year onwards have been included where there are no later figures; Most results have been taken from reports published by the airline groups. Other sources include returns to regulatory bodies, such as ICAO or national civil aviation bodies, press statements and other published reports. Estimates based on analysis of historical traffic, financial and fleet data, and regional trends have been made for carriers where no figures are available.

flightglobal.com/airlines July-August 2015 | Airline Business | 39

WORLD AIRLINE RANKINGS TRAFFIC

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Airlines keep steady traffic paceANALYSIS BY FLIGHTGLOBAL INSIGHT DATA COMPILED BY SILVA ISHAK FLIGHTGLOBAL DATA RESEARCH

Global passenger traffic among the 150 leading carriers increased 6% in 2014, the latest Airline Business World Airline Rankings show. This was slightly ahead of the capacity added and helped lift collective load factors to 80.5%

TOP 150 PASSENGER AIRLINE STATISTICS BY REGION: 2014

Region Passenger traffic (RPK) Load factors Passenger numbers EmployeeMillion Change (%) Percent Pt change Million Change (%) share (%)

Africa 104,530 2.0 68.8 -1.5 42 6.3 3.8Asia Pacific 1,765,358 7.0 77.9 -0.4 930 7.4 35.0Europe 1,694,832 6.3 82.3 0.4 830 6.5 23.4Latin America 285,489 5.6 80.0 1.9 202 5.4 5.8Middle East 528,300 11.5 78.2 0.8 147 11.1 7.8North America 1,536,863 3.0 83.4 0.3 813 2.9 24.3TOTAL 5,915,370 6.0 80.5 0.2 2,964 5.9 100.0NOTE: Based on returns to the latest Top 150 airlines ranking

TOP 150 PASSENGER AIRLINE STATISTICS BY AIRLINE TYPE: 2014

Airline Type Passenger traffic (RPK) Load factors Passenger numbers EmployeeMillion Change (%) Percent Pt change Million Change (%) share (%)

Leisure 219,073 4.5 88.3 -0.4 79 3.6 1.7Low-cost 992,794 10.0 83.3 1.6 758 8.2 11.2Mainline 4,606,395 5.3 79.5 -0.2 2,015 5.4 84.9Regional 97,109 2.8 81.1 1.7 113 1.5 2.3TOTAL 5,915,370 6.0 80.5 0.2 2,964 5.9 100.0NOTE: Based on returns to the latest Top 150 airlines ranking

Star Alliance

SkyTeam

Oneworld

Unaligned

KEY

Regional traffic changes are based on RPKs for the top 150 airlines

TOP 20 AIRLINE GROUPS BY TRAFFIC

Rank Airline group RPK (m)

1 Delta Air Lines 326,4652 American Airlines Group 314,8023 United-Continental Holdings 288,0364 Emirates Airline 235,4985 Air France-KLM Group 229,3476 Lufthansa Group 214,6417 IAG 202,5628 Southwest Airlines 173,8299 China Southern Airlines Group 166,62910 Air China 154,68311 China Eastern Airlines 127,63712 Ryanair 120,00013 Cathay Pacific Group 112,25714 Qantas Group 109,65915 LATAM Airlines Group 108,53416 Turkish Airlines 106,78717 Singapore Airlines Group 99,95218 Air Canada 99,14019 Aeroflot 90,07520 Qatar Airways 95,977



TOP 150 PASSENGER OPERATIONS

July-August 2015

TOP PASSENGER OPERATIONS RANKED BY TRAFFIC 2014: 1 TO 50

Ranking Airline Country Passenger traffic (RPK) Seat capacity (ASK) Load factor Passenger number Fleet

2014 (2013) Million Change (%) Million Change (%) Percent Pt change Million Change (%) Current

1 (1) Delta Air Lines USA 326,465 4.1 385,642 3.0 84.7 0.9 171.4 4.1 796 2 (2) United Airlines USA 288,036 0.2 344,495 0.5 83.6 -0.2 91.5 0.2 707 3 (3) Emirates Airline UAE 235,498 9.4 295,740 9.1 79.6 0.2 49.3 10.7 234 4 (4) American Airlines USA 208,108 0.7 253,576 2.0 82.1 -1.0 88.0 1.2 964 5 (5) Southwest Airlines USA 173,829 3.4 210,785 0.4 82.5 2.4 135.8 2.0 670 6 (6) Lufthansa Germany 156,826 2.3 197,478 1.9 79.4 0.3 77.5 1.7 276 7 (8) British Airways UK 138,431 5.4 170,917 5.9 81.0 -0.4 41.5 3.9 262 8 (9) China Southern Airlines China 135,637 11.4 168,530 11.3 80.5 0.1 77.9 9.6 491 9 (7) Air France est France 134,000 -1.8 162,500 -1.7 82.5 -0.1 47.0 -1.8 231 10 (10) China Eastern Airlines China 127,637 6.0 160,600 5.6 79.5 0.3 83.9 6.0 289 11 (13) Ryanair est Ireland 120,000 15.7 136,000 8.5 88.2 5.5 90.5 10.8 323 12 (12) Air China China 112,495 7.9 145,924 13.7 77.1 -4.1 54.6 5.0 333 13 (16) Turkish Airlines Turkey 106,787 16.1 135,330 16.3 78.9 -0.1 54.7 13.3 247 14 (11) US Airways USA 106,679 0.2 128,579 2.6 83.0 -2.0 57.6 0.9 15 (15) Cathay Pacific Hong Kong 100,048 6.8 118,481 5.8 84.4 0.8 22.3 4.2 143 16 (17) Air Canada Canada 99,140 8.5 118,887 7.8 83.4 0.6 38.5 7.7 167 17 (19) Qatar Airways Qatar 95,977 16.4 126,767 15.5 75.7 0.6 22.3 14.9 161 18 (14) Singapore Airlines Singapore 94,209 -0.9 119,674 -0.7 78.7 -0.2 18.7 0.6 105 19 (18) KLM Netherlands 91,477 2.7 105,755 1.9 86.5 0.7 27.7 4.4 112 20 (21) All Nippon Airways Japan 74,221 8.4 109,698 7.0 67.7 0.9 50.4 2.9 190 21 (23) EasyJet UK 72,933 7.9 79,525 7.1 91.7 0.7 64.8 6.6 216 22 (20) Qantas Australia 71,270 -2.3 91,270 0.4 78.1 -2.1 22.1 -2.0 118 23 (28) Etihad Airways UAE 68,600 23.6 85,792 20.7 79.2 1.2 14.8 22.3 112 24 (22) Korean Air South Korea 67,948 -0.6 90,980 2.1 74.7 -2.0 23.5 -0.5 162 25 (25) Aeroflot Russia 67,122 11.4 85,822 12.3 78.2 -0.6 23.6 13.0 160 26 (27) JetBlue Airways USA 60,842 5.5 72,395 5.1 84.0 0.4 32.1 5.3 208 27 (26) TAM Linhas Aereas Brazil 60,247 1.7 72,715 -2.2 82.9 3.2 37.9 1.5 162 28 (24) Thai Airways International Thailand 56,377 -11.2 81,652 -4.7 69.0 -5.1 17.8 -17.4 80 29 (29) Japan Airlines Japan 52,890 7.6 72,960 8.2 72.5 -0.4 28.2 17.2 157 30 (32) Saudia Saudi Arabia 51,782 10.1 67,848 4.3 76.3 4.0 27.4 8.3 161 31 (30) Air Berlin Germany 49,270 1.4 59,031 3.1 83.5 -1.4 31.7 0.6 98 32 (34) LAN Airlines est1 Chile 48,250 2.7 57,500 0.9 83.9 1.5 30.0 1.7 82 33 (33) Transaero Airlines Russia 47,066 0.1 56,367 0.2 83.5 -0.1 13.2 5.6 98 34 (31) Malaysia Airlines Malaysia 46,375 -1.9 62,570 7.2 74.1 -6.9 17.0 -1.0 97 35 (43) Hainan Airlines China 45,072 36.2 51,742 34.3 87.1 1.2 25.4 37.3 139 36 (35) Alaska Airlines USA 44,695 6.1 52,180 6.6 85.7 -0.4 21.0 6.3 139 37 (36) Iberia Spain 42,686 2.9 54,328 3.6 78.6 -0.6 10.7 1.1 75 38 (40) Shenzhen Airlines China 38,668 11.4 47,875 12.5 80.8 -0.8 26.3 10.2 155 39 (41) Gol Transportes Aereos Brazil 38,085 9.8 49,503 -0.3 76.9 7.1 40.1 9.5 129 40 (37) Virgin Atlantic Airways UK 37,664 -4.7 48,772 -3.1 77.2 -1.3 6.0 1.3 41 41 (59) Norwegian Norway 37,615 39.9 46,479 35.4 80.9 2.6 24.0 15.8 86 42 (42) China Airlines Taiwan 35,886 4.9 46,200 4.3 77.7 0.5 14.2 10.1 79 43 (39) Swiss Switzerland 35,717 1.8 42,679 1.8 83.7 0.0 16.2 1.3 76 44 (45) Asiana Airlines South Korea 35,223 7.4 46,780 5.0 75.3 1.7 16.5 7.7 84 45 (44) Air India India 35,101 6.7 47,702 6.9 73.6 -0.2 16.7 7.0 100 46 (46) SAS Sweden 34,594 5.9 45,158 4.4 76.6 1.1 28.4 6.2 146 47 (38) Alitalia est Italy 34,500 -3.0 46,000 -3.6 75.0 0.4 23.4 -2.6 106 48 (52) Jet Airways India 34,423 15.7 41,769 9.7 82.4 4.2 19.5 13.1 104 49 (48) WestJet Canada 33,514 6.3 41,165 6.7 81.4 -0.3 19.7 6.3 107 50 (49) Virgin Australia Australia 33,067 5.6 42,218 1.1 78.3 3.4 19.7 2.1 95 NOTES: est RPK/ASK/load factor estimated based on full-year passenger data; est1 Airline Business estimate; American Airlines includes US Airways Fleet; Air Berlin includes Niki; Virgin Australia 2013 figure includes SkyWest Australia for May and June only; Avianca includes TACA; SAS does not include Wideroe; China Eastern includes Shanghai Airlines; Air China includes Dalian

ANALYSIS BY FLIGHTGLOBAL INSIGHT DATA COMPILED BY SILVA ISHAK FLIGHTGLOBAL DATA RESEARCH



Ranking Airline Country Passenger traffic (RPK) Seat capacity (ASK) Load factor Passenger number Fleet

2014 (2013) Million Change (%) Million Change (%) Percent Pt change Million Change (%) Current

51 (50) Avianca Colombia 32,602 4.5 41,052 5.9 79.4 -1.0 26.2 6.5 83 52 (47) Thomson Airways UK 31,652 0.2 34,018 -0.4 93.0 0.6 10.4 -1.7 62 53 (60) Sichuan Airlines China 31,414 17.8 36,522 14.2 86.0 2.6 19.2 14.7 101 54 (51) Lion Air est Indonesia 31,400 5.0 35,000 4.8 89.7 0.2 36.0 5.2 103 55 (57) EVA Air Taiwan 30,518 10.2 39,039 12.3 78.2 -1.4 8.9 11.1 65 56 (55) Garuda Indonesia Indonesia 30,231 8.9 42,904 13.9 70.5 -3.2 21.6 10.0 134 57 (54) TAP Portugal Portugal 30,119 7.0 37,389 5.5 80.6 1.1 11.4 6.6 61 58 (63) Grupo Aeromexico Mexico 28,772 15.0 36,217 11.5 79.8 2.6 17.2 11.0 131 59 (53) Jetstar Australia 28,644 -0.1 36,824 1.5 77.8 -1.3 17.1 2.3 70 60 (56) Air New Zealand New Zealand 28,078 1.2 33,396 0.7 84.1 0.5 13.7 2.3 51 61 (66) Xiamen Airlines China 27,712 14.5 37,382 15.6 74.5 -0.5 20.4 9.6 11862 (61) AirAsia Malaysia 27,274 2.5 34,590 3.6 78.8 -0.8 22.1 1.3 80 63 (62) Vietnam Airlines est1 Vietnam 26,500 5.6 33,500 5.9 79.1 -0.2 16.0 6.7 79 64 (70) IndiGo India 26,048 14.0 33,528 16.3 77.7 -1.6 22.9 18.9 96 65 (65) Condor Germany 25,916 5.3 28,667 4.9 90.4 0.3 7.2 5.9 42 66 (58) ExpressJet Airlines USA 25,608 -5.6 31,536 -7.3 81.2 1.5 31.0 -6.1 367 67 (68) Copa Airlines Panama 25,604 9.5 33,398 9.5 76.7 0.0 7.8 0.2 80 68 (72) Wizz Air Hungary 25,351 21.5 29,267 20.0 86.7 1.0 16.5 18.4 61 69 (67) SkyWest Airlines USA 24,953 3.7 29,919 2.2 83.4 1.2 27.8 2.4 337 70 (78) Philippine Airlines Philippines 24,821 32.1 34,780 30.1 71.4 1.1 9.6 43.1 58 71 (64) Finnair Finland 24,772 0.0 30,889 -0.9 80.2 0.7 9.6 3.9 46 72 (76) Spirit Airlines USA 22,783 18.0 26,291 17.9 86.7 0.1 14.3 15.1 73 73 (71) Hawaiian Airlines USA 22,399 1.8 27,471 1.7 81.5 0.1 10.2 2.6 48 74 (69) South African Airways South Africa 22,313 -4.4 30,533 -1.7 73.1 -2.1 7.0 0.0 56 75 (73) Ethiopian Airlines Ethiopia 22,267 11.7 31,602 13.3 70.5 -1.0 6.2 10.7 69 76 (75) Air Europa Spain 21,980 13.1 26,174 14.1 84.0 -0.7 9.6 10.3 53 77 (82) Vueling Airlines Spain 21,445 25.3 26,686 24.2 80.4 0.7 21.5 24.9 99 78 (88) AirAsia X Malaysia 20,817 31.3 25,374 31.4 82.0 -0.1 4.2 33.8 16 79 (74) Thomas Cook Airlines UK 20,696 4.5 22,644 6.4 91.4 -1.7 6.0 -0.7 37 80 (83) UTair Russia 20,199 20.4 25,249 15.6 80.0 3.2 8.6 4.7 266 81 (85) Pegasus est Turkey 19,500 20.1 24,378 20.9 79.9 -0.6 19.7 17.4 54 82 (79) El Al Israel 18,984 1.7 23,018 2.2 82.5 -0.4 4.6 4.0 38 83 (80) TUIfly est Germany 18,500 2.8 20,500 2.5 90.2 0.2 7.8 2.6 27 84 (81) Austrian Austria 18,428 4.1 23,343 3.6 78.9 0.4 11.2 -1.0 76 85 (77) Egyptair Egypt 18,358 -3.1 28,562 -3.3 64.3 0.1 8.8 3.3 57 86 (84) Spring Airlines China 18,258 10.7 19,617 11.2 93.1 -0.5 11.4 8.5 50 87 (87) Frontier Airlines USA 17,946 13.1 20,175 15.4 89.0 -1.8 12.2 14.0 56 88 (90) Shandong Airlines China 17,580 12.8 22,881 13.8 76.8 -0.7 14.1 9.8 82 89 (86) Air Transat est1 Canada 17,500 9.4 19,500 11.4 91.5 -0.5 3.5 5.0 25 90 (100) Cebu Pacific Air Philippines 16,213 25.4 20,496 26.5 79.1 -0.7 16.9 17.5 51 91 (89) Virgin America USA 16,212 2.7 19,695 0.0 82.3 2.2 6.5 2.8 53 92 (93) Aer Lingus Ireland 16,088 8.7 20,373 7.8 79.0 0.6 9.8 1.5 49 93 (92) Azul Brazil 15,707 4.9 19,701 4.1 79.7 0.6 20.0 7.3 146 94 (91) Monarch Airlines UK 15,705 2.8 19,357 7.8 81.1 -4.0 7.0 3.0 34 95 (95) Volaris Mexico 15,644 8.0 19,034 8.5 82.2 -0.4 9.8 9.7 53 96 (96) S7 Airlines Russia 15,583 9.8 19,503 11.1 79.9 -1.0 7.9 12.0 45 97 (97) Transavia Airlines est Netherlands 14,000 3.7 15,500 3.3 91.0 1.0 6.8 4.6 36 98 (107) Capital Airlines China 13,823 20.2 15,562 15.3 88.8 3.3 9.2 12.5 91 99 (103) Air Arabia UAE 13,800 11.3 17,000 11.3 81.0 1.0 6.8 11.3 34 100 (99) Nordwind Airlines Russia 13,402 -0.2 14,663 -4.5 91.4 3.9 4.5 22.3 18 NOTES: est RPK/ASK/load factor estimated based on full-year passenger data; est1 Airline Business estimate; Lion Air passenger number reported locally; Cebu Pacific includes Tigerair Phillipines since July 2014

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July-August 2015

TOP 50 AIRLINES BY PASSENGERS

Rank Airline No. of Pax(m)

1 Delta Air Lines 171.42 Southwest Airlines 135.83 United Airlines 91.54 Ryanair 90.55 American Airlines 88.06 China Eastern Airlines 83.97 China Southern Airlines 77.98 Lufthansa 77.59 EasyJet 64.810 US Airways 57.611 Turkish Airlines 54.712 Air China 54.613 All Nippon Airways 50.414 Emirates Airline 49.315 Air France 47.016 British Airways 41.517 Gol Transportes Aereos 40.118 Air Canada 38.519 TAM Linhas Aereas 37.920 Lion Air est 36.021 JetBlue Airways 32.122 Air Berlin 31.723 ExpressJet Airlines 31.024 LAN Airlines est 30.025 SAS 28.426 Japan Airlines 28.227 SkyWest Airlines 27.828 KLM 27.729 Saudia 27.430 Shenzhen Airlines 26.331 Avianca 26.232 Hainan Airlines 25.433 Norwegian 24.034 Aeroflot 23.635 Korean Air 23.536 Alitalia 23.437 IndiGo 22.938 Cathay Pacific 22.339 Qatar Airways 22.340 Qantas 22.141 AirAsia 22.142 Garuda Indonesia 21.643 Vueling Airlines 21.544 Alaska Airlines 21.045 Xiamen Airlines 20.446 Azul 20.047 WestJet 19.748 Virgin Australia 19.749 Pegasus 19.750 Jet Airways 19.5

NOTES AND DEFINITIONS This year’s ranking includes the individual passenger airline operations of all mainline, regional and charter carriers. Subsidiary carriers and regionals have been included in their own right where they are identifiable, independent operators from their parent. Leisure operations have also been included reflecting the blurred line between scheduled and charter activities; TRAFFIC/CAPACITY/LOADS Traffic data generally includes scheduled and charter except for those carriers, such as the US majors, where the scheduled-only figures are more commonly used. All data is in metric units as follows: RPK=revenue passenger km, ASK=available seat km, RTK=revenue tonne km, 1 US ton=1.1 tonnes and 1 mile=1.609km; YEAR Results are for the fiscal year were available, but calendar or nearest full 12 month period available; SOURCES AND ESTIMATES Fleet data is provided by Flightglobal’s Ascend Fleets. All other figures are primarily sourced from company replies to Airline Business or company reports. Other sources include national regulators, regional airline assocations and ICAO. Estimates based on analysis of historical traffic, regional trends, financial and fleet data have been made for carriers where no figures are available for indicative purposes.


Ranking Airline Country Pax Traffic (RPK) Pax number Fleet2014 (2013) Million Change (%) Million Change (%) Current

101 (106) Ural Airlines Russia 13,327 13.2 5.2 17.0 35 102 (98) SpiceJet India 13,135 -2.4 12.8 0.3 32 103 (101) SriLankan Airlines Sri Lanka 12,964 1.2 4.3 4.1 20 104 (109) Juneyao Airlines China 12,853 13.1 8.2 16.3 44 105 (102) Royal Air Maroc Morocco 12,793 2.8 6.8 15.9 48 106 (108) Allegiant Air USA 12,592 9.8 8.2 12.6 75 107 (113) Thai AirAsia Thailand 12,420 14.7 12.2 16.3 43 108 (114) Jet2 UK 12,255 13.4 6.0 8.9 59 109 (112) Dragonair Hong Kong 12,209 12.2 9.3 9.0 40 110 (94) Envoy USA 12,133 -17.0 16.1 -9.2 180 111 (105) Aerolineas Argentinas est1 Argentina 12,000 0.0 4.0 0.0 51 112 (104) Pakistan International Pakistan 11,903 -2.7 4.2 -5.6 33 113 (110) Oman Air Oman 11,336 0.1 5.1 1.1 39 114 (126) Tianjin Airlines China 10,985 31.5 9.9 23.4 84 115 (116) Brussels Airlines Belgium 10,756 10.1 6.6 12.4 48 116 (115) SunExpress est1 Turkey 10,500 7.4 7.3 9.0 22 117 (130) Republic Airlines USA 10,267 31.2 13.3 28.8 137 118 (121) Rossiya Russian Airlines Russia 10,147 10.5 5.2 13.1 27 119 (118) Kenya Airways est1 Kenya 10,000 7.4 4.0 7.5 39 120 (117) Tigerair Singapore 9,696 4.0 5.1 1.4 24 121 (124) Aegean Airlines Group Greece 9,584 13.6 10.1 14.4 58 122 (120) China Xinhua Airlines China 9,389 1.9 6.0 5.2 5 123 (119) Indonesia AirAsia Indonesia 9,150 -1.5 7.9 0.0 29 124 (122) Thomas Cook ScandinaviaDenmark 8,829 -2.8 2.4 -1.6 12 125 (129) Gulf Air Bahrain 8,692 10.5 5.2 15.4 28 126 (123) Corsair France 8,598 -0.5 1.2 -0.4 7 127 (127) Interjet Mexico 8,578 2.9 8.7 3.6 54 128 (111) Orenair Russia 8,471 -22.9 3.0 -3.4 18 129 (128) Mahan Air Iran 8,313 5.6 5.7 6.0 43 130 (125) Royal Jordanian Jordan 8,136 -3.5 3.2 -1.8 26 131 (133) LOT Polish Airlines Poland 8,045 13.7 4.8 2.7 41 132 (137) Icelandair Iceland 7,777 17.9 2.6 15.4 26 133 (131) Air Astana Kazakhstan 7,754 4.0 3.8 3.9 30 134 (136) Kuwait Airways Kuwait 7,182 5.7 2.4 12.4 26 135 (132) Uzbekistan Airways Uzbekistan 7,044 -1.5 2.6 -2.0 35 =136 (142) Hong Kong Airlines est1 Hong Kong 7,000 12.2 5.0 22.0 25 =136 (135) Jetairfly est1 Belgium 7,000 1.4 2.8 0.7 22 =136 (134) Skymark Airlines est Japan 7,000 0.8 6.8 0.4 28 139 (138) Mesa Airlines USA 6,968 7.7 8.6 1.0 107 140 (149) China United Airlines China 6,668 13.2 5.5 11.2 30 141 (150) Air India Express India 6,622 16.2 2.6 14.3 17 142 (141) Travel Service Airlines Czech Republic 6,542 4.7 3.3 2.6 28 =143 (151) Anadolu Jet Turkey 6,500 16.1 9.0 11.1 34 =143 (155) Biman Bangladesh est1 Bangladesh 6,500 23.8 2.0 25.0 12 145 (140) Ukraine International Ukraine 6,479 3.1 3.7 -14.9 28 146 (143) Kulula South Africa 6,385 5.0 3.2 1.8 11 147 (139) Air Algerie Algeria 6,228 -1.8 5.0 6.1 48 148 (144) Shuttle America USA 6,194 2.4 5.8 -4.8 110 149 (148) Jetstar Asia Singapore 6,188 4.9 4.0 9.2 18 150 (145) Air Mauritius Mauritius 6,186 2.3 1.4 3.0 14 NOTES: * est RPK/ASK/load factor estimated based on full-year passenger data; est1 Airline Business estimate; Fleet as at 30 June 2015

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