Croatia Airlines reported mixed financial and operating results for the first nine months of 2024 as its fleet ambitiously switches to Airbus A220 aircraft. The significant costs associated with fleet upgrades, combined with inflation and higher operating expenses, resulted in a net loss of €9 million, in contrast to the profit of €7.1 million reported in the same period in 2023. The airline’s total revenue reached 206.1 million euros, close to 2023 levels. However, operating expenses increased by 9% to €215.1 million due to higher maintenance, rental and personnel costs. Croatia Airlines took out additional short-term leases to meet maintenance plans, which combined with inflationary pressures resulted in an increase in operating costs of €11.6 million.
One of the factors contributing to the airline’s increased costs was maintenance expenses, which increased by 8% to €33.9 million, mainly due to the transition of aircraft types and the operational challenges of managing two different fleet types during the transition. To maintain service reliability, additional aircraft leases are required, which increases overall costs. Passenger and airport service costs increased by 7% to €44 million due to higher passenger numbers, higher airport fees and longer flight schedules. Croatia Airlines is implementing a 10% wage increase starting in April 2023 to offset inflation and attract skilled labour. The new five-year collective agreement signed this year further consolidates these adjustments, affecting the company’s general and administrative expenses, which increased to €9.6 million.
Between January and September 2024, the national airline saw growth in most of its operating metrics. During the nine-month period, Croatia Airlines carried 1,424,916 passengers, an increase of 0.5.5% or 74,679 passengers compared to the previous year. However, the number is still down 16.2% from pre-pandemic 2019, or 276,655 fewer passengers. In the first three quarters of 2024, the airline received 1,046,208 passengers on international flights, a year-on-year increase of 6.9%; 333,096 passengers on domestic flights, a year-on-year increase of 6.3%; and 45,612 passengers on charter flights, a year-on-year decrease of 21.7%. %. The average cabin load factor was 64.7%, a decrease of 1.2 percentage points from last year and a decrease of 9.1 percentage points from 2019.
Looking ahead, Croatia Airlines expects that once the A220 fleet is fully operational, its financial position will stabilize and maintenance and fuel costs will decrease. Increased A220 passenger capacity and lower operating costs are expected to improve profitability in the medium term. Additionally, the company’s expanded network and improved service offerings, such as digital check-in tools, baggage tracking and in-flight electronic media options, are expected to increase customer satisfaction and loyalty.
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