Spanish low-cost carrier Vueling has cut its first quarter net losses to €16.5 million ($21.3 million) - a 28.7% improvement on Q1 2011.
Operating losses stood at €26.8 million for the three months to 31 March, while total revenues rose 32.5% to €168.5 million and passenger numbers were up by 24.1% to 2.6 million.
The carrier's load factor was up by 7.3 percentage points to 76.4%.
Vueling credits its fuel hedging strategy with offsetting high oil prices - up 13% year-on-year to an average price of $120 per barrel - but warns that fuel costs still rose 38% on higher volumes.
Its number of connecting passengers more than doubled to 201,000 in the first quarter, buoyed by onward Iberia flights at Madrid Barajas airport. A new interline agreement with British Airways is further expected to boost this figure throughout 2012.
Looking ahead, the carrier expects to increase capacity by between 20-25% in 2012, turning its focus away from the declining domestic Spanish market and towards new airline partnerships.