Korean Air posts record operating profit in 2021 on freight boom

Monday, 31 January 2022 01:25 - - {{hitsCtrl.values.hits}}

REUTERS: Korean Air Lines Co. Ltd. said last week it had record fourth-quarter and annual operating profits in 2021, fuelled by strong cargo demand and freight rates, even though the passenger market stays subdued.

The airline more than quadrupled operating profit to 704.4 billion won ($ 585.22 million) in the fourth quarter over the prior year as peak demand in the year-end holiday season and limits on passenger jet belly space pushed up freight rates.

“The airline was able to respond proactively to the global supply chain disruptions and operational restrictions caused by the Omicron variant, and provide clients with reliable services,” Korean Air said in a statement.

Several large Asian airlines, including Korean Air, Taiwan’s China Airlines Ltd., Hong Kong’s Cathay Pacific Airways Ltd. and Singapore Airlines Ltd., have relied heavily on cargo revenue during the pandemic as strict border controls have limited passenger travel.

This week, the International Air Transport Association said international air cargo demand in Dec. 2021 was 9.4% above the level in 2019, but capacity was 6.5% lower, supporting higher freight rates.

On Thursday, China Airlines said it had posted record air freight revenues of T$ 15.4 billion ($ 554.08 million) in December.

The Taiwan airline’s board approved the purchase of four more Boeing Co 777F freighters, adding to an earlier order for six of the same model as it steps up capacity to support the island’s booming exports.