Fuels drag TAP into the “Red”

TAP’s 18 percent increase in revenue between January and August was insufficient to compensate for the brutal rise on fuel costs with the result that the airline registered losses of 133 million euros at the close of the first eight months of 2008.

The average price of petroleum in the first eight months of the year reached 114 US dollars, representing an increase of 128 million euros in the fuel bill paid by the airline transport company.

The fact that during the same period of last year the company registered profits of 24 million euros illustrates the impact of fuel prices on TAP figures and confirms the prediction of negative year-end results.

Between January and August of this year, TAP revenue rose to 1,413 million euros, 18 percent higher than the 1,197 million registered in the same period of 2007.

TAP operating results to the end of August totaled a negative 94 million compared with a positive 45 million in the first eight months of last year.

EBITDAR also suffered a reduction, falling from a positive 150 million in the first eight months of 2007 to a positive 37 million in the same period of 2008.

Overall exploitation costs rose to 1,376 million euros, 31 percent higher than the 1,047 million registered in the first eight months of 2007, a difference caused by the increase in fuel prices since without this item costs rose by 16 percent, a figure that is lower than growth in gains.

Ticket revenue reached a total of 1,180 million euros representing an increase of 19.6 percent compared with that registered in the same period of 2007.

During the month of August passenger traffic rose 7.6% contributing to an accumulated result for the first eight months of the year of 17.3%. That accumulated benefits from the fact during the first six months of the year the comparison was made with the period of the previous year TAP had not yet acquired PGA. All sectors of its network have experienced positive growth.

Assistance activities provided to third parties by the Maintenance & Engineering Unit also registered around 92.8 million euros in gains, evidence of an increase of more than 18 percent in relation to the first eight months of 2007.

In Cargo and Mail, TAP gains rose 18.8 percent increasing from 64 million euros between January and August 2007 to 76 million in the same period of this year.