SAS issues profit warning for 2004

Airline Industry Information, June 23, 2004

AIRLINE INDUSTRY INFORMATION-(C)1997-2004 M2 COMMUNICATIONS LTD

Scandinavian airline group SAS Group issued on Wednesday (23 June) a profit warning, saying that its previous aim of a positive result before taxes, capital gains and non-recurring items for the full year 2004 was not expected to be possible to achieve.

The company said that due to the continued large overcapacity on many markets and heavy price pressure, yields for Scandinavian Airlines had developed very weak during April and May 2004.

Yields for May were down by 22.5% compared with May 2003, and in addition jet fuel prices had been at very high levels during the second quarter 2004.

The other airlines in the group had developed according to plan, the company added.

SAS said that the passenger volumes had developed well and Turnaround 2005, incorporating cost reductions of SEK14bn, was developing according to plan and would continue to give significant unit cost reductions for all airlines in the group.

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