Traffic to increase in Q4 on economic recovery: Korean Air

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Korean Air expects passenger traffic to increase in the fourth quarter of 2013, in line with the global economic recovery.

The carrier said in an investor presentation that load factors for new services to Yangon, Colombo and Saudi Arabia will increase, along with those of routes to China and Southeast Asia.

In the next quarter, it will introduce new routes – Cheongju-Bangkok and Busan-Manila – and increase frequencies on 15 routes from Seoul Incheon and Busan. The Seoul Incheon-Atlanta service will see a significant capacity increase as Korean Air raises the frequency of its Airbus A380 operation on the route to daily.

The airline added 10 more European destinations to its network, as a result of its co-operation with Czech Airlines. The two carriers jointly operate a daily Seoul Incheon-Prague service and have a codesharing agreement. Korean Air owns a 44% stake in Czech Airlines.

During the July-September period, the total number of passengers carried declined by 2%, as a lower number of overseas passengers had offset the 5% increase in outbound traffic from South Korea. Routes to Japan and Oceania saw a drop of up to 20% in its RPK traffic, while routes to the Americas, Southeast Asia and China recorded increases of up to 11%.

Domestic passenger yields during the period rose by 3.1% to 19.8 cents, while international passenger yields fell by 2% to 9.8 cents.

On the cargo front, the carrier expects traffic to increase with the launch of new IT products. This is in addition to economic recovery in the North American and European markets. It hopes to achieve steady growth by developing new markets in Vietnam and Mexico and improve profitability with fuel efficient aircraft. Overall yields for the sector during quarter declined by 2.1% to 28.2 cents.

Korean Air posted a net profit of won (W) 342 billion ($322 million) in the third quarter of 2013, down from W345 billion a year earlier. Operating revenue for the period ended 30 September declined by 3.4% to W3.29 trillion.