(AOF) – Virgin Galactic climbed 3.7% in pre-opening on Wall Street. The space tourism group posted a net loss of 31 cents per share in the fourth quarter of 2021. This is a lower loss than the Refinitiv consensus forecast (-35 cents). The company founded by British billionaire Richard Branson also stood out thanks to an improvement in its cash flow, which stood at 931 million dollars at the end of December 2021, against 679 million dollars a year earlier.
On the other hand, the turnover is established at 141,000 dollars, whereas the market discounted 331,000 dollars.
“We remain on track and on schedule to complete our improvement program and launch commercial service later this year,” said Michael Colglazier, CEO of Virgin Galactic.
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Air transport: a very gradual recovery
If the resumption of air transport is looming, the International Air Transport Association (IATA) has revised its traffic forecast for 2021 downwards.
In 2021, air traffic is expected to be 43% of its pre-Covid-19 level, according to the latest IATA forecast, which previously forecast 51%. Not all companies will benefit equally from the recovery.
Gradual improvement
IATA estimates losses for the industry at $47.7 billion this year compared to $126.4 billion in 2020. Total passenger numbers are expected to reach 2.4 billion in 2021, well below the 4.5 billion of 2019.
The health crisis had a very significant impact on the accounts of European airports, which lost 70% of their traffic in 2020. They lost 60% of their income, or 29.2 billion euros. Unlike the airlines, they have benefited very little from state aid. Aid reached 2.17 billion euros, against more than 34 billion for carriers. Given the slow recovery, major European airports will not regain their normal investment capacity before 2032. According to the Association of European Airports (ACI Europe), traffic will not return to its 2019 level before 2024 or 2025. During this recovery period, cost pressure will remain high due to health measures and certain regulatory provisions.
Impact on business travel
Experts believe that low-cost airlines, focused on leisure customers, will benefit the most from the recovery. They are more flexible and less dependent on the reopening of international lines and the return of business customers. The business tourism activity suffered a collapse of its activity but it is above all faced with a complete redefinition of its model with the rise of virtual solutions and their low cost. This structural drop in business travel will have a strong impact on airlines. According to experts, if 25% of tickets on a flight are purchased for business travel, they generate 55% to 75% of airline profits.