Icelandair Group is expecting its cargo operation to return an operating profit over the course of this year, after recent poor results.

The company says it has a “clear plan” to turn around the cargo division, which generated full-year revenues of $88.3 million – a fall from the previous year’s $90.8 million.

“Profitability in the cargo operation decreased significantly,” said group finance chief Ivar Kristinsson during a full-year briefing.

He says the cargo performance improved between the third and fourth quarter. But cargo revenues were still down in the fourth quarter compared with the previous year, reaching $21.6 million.

Icelandair 757 freighter-c-Konstantin von Wedelstaedt Creative Commons

Source: Konstantin von Wedelstaedt/Creative Commons

Icelandair Cargo will return a 757 freighter and lease out a 767

Icelandair Group says it is implementing “diverse improvement measures” to address the situation.

It is returning a Boeing 757 freighter to its lessor in spring, and is dry-leasing a 767 freighter out of the fleet for the full duration of this year.

Chief executive Bogi Nils Bogason says the 767 has been leased to “align capacity to the demand”.

Icelandair Group says other changes are being put in place including an “optimised flight schedule” and “adjusted network”.

There is an “increased focus” on core products, it adds, driving higher unit revenues.

Cargo markets were “challenging” last year, but the company believes its measures are starting to produce positive effects, and it forecasts an operating profit for this year compared with the “considerable” operating loss in 2023.