MID YEAR DATA RELEASED BY IATA ON SECTORAL PERFORMANCE
(Posted 06th June 2017)
- Consumers benefit from lower real travel costs, more routes, and will spend 1% of world GDP on air transport in 2017
- Economic development is a big winner from the doubling of city pairs and halving of air transport costs over the past 20 years.
- Governments gain substantially from $124bn of tax this year and from over 69 million ‘supply chain’ jobs.
- Stronger economic growth is pushing traffic ahead of capacity growth, but breakeven loads rising as unit costs grow significantly.
- Equity owners see further gains in 2017; industry ROIC falls from record 2016 levels, but remains above the cost of capital.
- Credit metrics in 2017 not quite as good as 2016, but free cash flow yield remains positive and balance sheet metrics are stable.
- Jobs in the industry should reach 2.78 million, and GVA/employee is over $99,000, but unit labour costs accelerating.
- Infrastructure use costs are high, plus inefficiencies in Europe alone add 2.9bn Euros to airline costs next year
- N American airlines perform best with a forecast 7.2% net post-tax profit margin in 2017. Africa is the weakest with a 0.9% loss.
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