TAP Air Portugal Closes 2022 with €65.6m Profit

DALLAS — Portuguese flag carrier TAP Air Portugal (TP) has emerged financially strong from the pandemic. This is evident from the 2022 financial report just published by the airline. The airline closed a complicated restructuring year with a net profit of €65.6m, an increase of €1,664.7m from the previous year.

Last year, TP carried 13.8 million passengers, which is about 136.1% more than in 2021 and around 81% of the pre-COVID levels in 2019. The number of flights carried out last year increased significantly to 74.2% compared to 2021, 79% of the pre-crisis level was reached. Also, the capacity reached 87% of the pre-crisis level and increased by 94.2% compared to 2021.

"TAP delivered in 2022, the first year of the Restructuring Plan, a performance close to that forecasted for 2025."

Christine Ourmières-Widener, TAP Air Portugal ex-CEO

Post-pandemic Recovery

The Portuguese airline has also recovered financially from the pandemic. In 2022, revenues reached €3.58.0m, 151% above the 2021 financial year, together with a higher level of activity (ASK increased by 94.2%).

Recurring operating costs also increased by 73.4% to €3,236.2m, resulting in a positive recurring EBIT of €248.8m, an increase of €726.7m or 4.7 times the amount in the 2019 financial year.

The PRASK was also €6.68 in 2022, an improvement of 43.5% from the previous year and 21.5% from 2019. In the fourth quarter of 2022, TP achieved the highest quarterly sales in its 88-year company history and had record profitability despite some operational difficulties

The outlook for the summer of 2023 is very good. On the basis of the many pre-bookings of tickets, it becomes apparent that demand has not fallen. Nevertheless, there are some difficulties.

According to the airline's ex-CEO, during the fourth quarter, TP generated the highest quarterly revenues in its history and record profitability despite continuous operational challenges.

Before being ousted by the Portuguese government a few weeks ago, the airline boss wanted to optimize intakes in an uncertain environment and reduce operating costs, especially because of strong inflation.

New CEO Luis Rodrigues is to follow suit, as he starts his position at TP in the midst of potential privatization from potential suitors Air France-KLM Group, Lufthansa Group, and IAG.

Featured image: TAP was the launch customer for the Airbus A330neo. Photo: Tony Bordelais/Airways

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