Icelandair swings to full-year profit despite impact of volcanic activity

Icelandair Group swung to a full-year net profit of $11m for 2023, despite volcanic activity contributing to a deeper loss in final three months of the year. The 2023 profit was driven by a 20% increase in revenue to $1.5b, and came after a loss of $6m 2022. The group’s full-year operating profit was $21m, while it saw “record high” unit revenues and a 17% rise in passenger numbers to 4.3m. Icelandair reports strong demand in all passenger markets, but particularly on North America to Iceland services, adding that challenges on the air cargo side of the business have been “acted on”. In the final quarter of 2023, however, a net loss of $38m and an operating loss of $50m were both much deeper year on year and came amid challenges created by volcanic activity in Iceland. That setback followed “one of the strongest third quarters” in the company’s history and was not enough to send the business into the red for the 12 months. Still, the impact of challenging end to the year was “significant”, the carrier states, and while operating revenue was still up year on year by around 8% in the three months, it lagged the full-year performance by some distance. The challenges are also expected to have a negative effect on Icelandair’s Q1 2024 results.<br/>