Consolidation drags down Aeroflot first-half profit

London
Source:
This story is sourced from Pro
See more Pro news »

Russia's Aeroflot Group halved operating profits during the first six months of 2012, despite a substantial revenue increase from airline consolidation.

Aeroflot Group indicated the effects of the tie-up in a first-half statement drawn up under international finanancial reporting standards.

The consolidation of Rossiya, Vladivostok Avia, Orenburg Airlines and Sakhalin operator SAT lifted group revenues by 54% to $3.6 billion, it says.

But Aeroflot says operating expenses rose by 64% to $3.5 billion and left a first-half operating profit of $98 million, compared with last year's figure of $205 million.

Aeroflot Group also scraped a net profit of just $7.1 million, barely breaking even in comparison with the $377 million achieved over the first half of 2011.

It attributes the performance to the integration of the additional carriers put points out that this move has not yet been completed.