IATA: Financial Results Of Airlines Remain Solid In Q2

KUALA LUMPUR, Oct 12 (Bernama) -- The latest financial results indicated that airline industry profitability and cash flow remained solid in the second quarter of 2016, although its profitability cycle is showing signs of peaking, said the International Air Transport Association (IATA). "Profit margins remain robust by historical standard, however, operating conditions are becoming more challenging," it said in a statement. "Share prices of global airlines rose by 0.9 per cent in September, but remain well below where they started the year. "Brent crude oil prices rallied towards the end of September following an agreement by the Organisation of the Petroleum Exporting Countries to cut oil output," the association said. IATA said a rebalancing in the market was slowly taking place, with oil prices expected to trend upwards weakly in the years ahead. It also said the intense downward pressure on passenger yields looked to have eased during mid-2016, in keeping with the change in the trend of oil prices. "The premium segment continues to offer a buffer for overall airline financial performance and premium airfares have held up better than those in economy on many of the main premium routes so far this year," it said. The developments in passenger traffic continued to reflect the net influence of a number of factors. "The upward trend in traffic has eased, but the seasonally-adjusted industry-wide load factor remains at historically high levels. "Conditions for air freight have improved from earlier in the year, but wider weakness in world trade volumes continues to present a stiff headwind. It also added that low loads continued to keep cargo yields and revenues under pressure. -- BERNAMA