INFORMATION ON THE OPERATING AND FINANCIAL RESULTS OF THE SATA GROUP IN 2024
• Passenger numbers reached a record high of 2.7 million, marking a 14% increase from 2023.
• The Group operated 2,328 more flights than in 2023, reinforcing its commitment to connecting the Azores with the rest of the world.
Despite this growth, extraordinary, mostly non-recurring and inherited costs led to an increase in expenditure, impacting on the financial results of both airlines.
• A Financial Sustainability Plan is underway, aiming to improve the Group's economic performance by €65 million.
In 2024, SATA Group carried 2.7 million passengers, marking the highest performance in its history. Compared to the same period last year, this represents a 14% increase.
The Group's average load factor increased significantly by 2.6 percentage points to 81.7%, alongside a 10% increase in available capacity compared to 2023.
Recognising the impact of these extraordinary factors on the accounts, the Board of Directors is implementing the Financial Sustainability Plan, which was developed by the Group's management teams. The plan aims to enhance the Group's financial and economic performance, with a particular focus on Azores Airlines.
Comprising 41 measures set to generate a financial impact of €65 million, the plan seeks to boost revenue, enhance operational efficiency and restructure support services. The plan includes short-term, medium-term, and long-term measures, most of which are already being implemented.
Statement by Rui Coutinho, CEO of the SATA Group:
"When the new management took over in July 2024, we adopted operational decisions to ensure realistic levels of profitability in line with the Group's financial capacity while strengthening our commitment to the mobility of the Azorean population and our links with the diaspora. With the Financial Sustainability Plan, we aim to position the Group on a path of sustainability, service excellence, and operational capacity tailored to the region's needs while maintaining financial discipline. We believe that 2024 marked a turning point for several reasons, and that 2025 will usher in a new chapter. The improved results obtained in the first months of 2025 indicate that we are on the right track.'
Azores Airlines 2024 Operational and Financial Overview
SATA Internacional — Azores Airlines — maintained its revenue growth trend, particularly through increased capacity for the IATA summer season. The company achieved total revenues of €336 million in 2024, an increase of €50.2 million in 2023.
A total of 11,671 flights were operated in 2024, 1,971 more than the previous year. These flights carried around 1.7 million passengers, 276,000 more than in the same period last year.
One of the most positive indicators for 2024 was the average load factor, which reached 84.6%, representing a 1.8 percentage point increase compared to the same period last year. This increase is mainly due to an effective fourth quarter (with an occupancy rate of 90.7%), as well as the cancellation of unprofitable flights, in line with some of the measures included in the Financial Sustainability Plan.
The increase in supply reflects the company's commitment to enhancing global connectivity. It is the result of investments in new routes, including Ponta Delgada–Montreal, Ponta Delgada–Milan, and Ponta Delgada–Faro.
Direct routes between Porto and Funchal, as well as to the USA and Canada, were inaugurated between June and September. Operated through ACMI, these routes proved highly unprofitable from a commercial perspective, generating additional structural costs. Ultimately, these routes harmed the company's operating results. Given this situation, and despite their contribution to increasing the number of flights and capacity offered, the current management has decided to cancel these routes for 2025, in line with the Financial Sustainability Plan.
Despite the increase in revenues, last year was marked by growth in both operating and non-operating costs, which directly impacted EBITDA and net results for the 2024 period. The accounts also reflected extraordinary factors, some of which will not recur in 2025.
These include additional charges due to adverse weather conditions impacting operations, as well as airport and hotel infrastructure being unable to cope with increased activity. Other factors include personnel expenses resulting from commitments made under new company agreements, maintenance costs, and provisions for an unfavorable legal outcome between Azores Airlines and Hifly regarding contractual charges for an A330 aircraft known as 'Cachalote'. The cumulative impact of these factors amounts to more than 30 million euros.
Consequently, operating results before interest, taxes, depreciation and amortisation (EBITDA) amounted to €691,000. However, correcting some of those mentioned above non-recurring extraordinary factors, particularly the impact of the Hifly case, which had a financial impact of €6.4 million in 2024. Correcting this factor would lead to positive operating results.
Depreciation and amortisation expenses increased by €13.4 million in 2024 compared to 2023 (a 44% increase), primarily due to the addition of two new aircraft to the fleet. Earnings before interest and taxes (EBIT) were therefore negative by €44.4 million for the year.
Net income for the year totalled a loss of €71.2 million. This change is primarily due to the factors as mentioned above, as well as impairment losses totalling approximately €5 million recognised in 2024. These losses offset gains totalling €5 million recognised in 2023.
In summary, 2024 saw several operating and non-operating events, many of which were exceptional, resulting in a negative total impact of around €53 million on the net result for the year.
SATA Air Açores experienced increased demand, resulting in sustained revenue growth.
The regional airline reported revenues of €60.6 million (excluding operating subsidies) in 2024, which is €3.7 million higher than the previous year. This reflects growing demand, resulting in a 3.1 percentage point increase in the average aircraft load factor — rising from 74.1% in 2023 to 77.3% in 2024.
A total of 19,094 flights were operated in 2024, 357 more than in the previous year, carrying approximately 1 million passengers, 53,000 more than during the previous year.
Regarding operating costs, a trend consistent with that observed in the sector was noted, alongside extraordinary operational and non-operational events that impacted operating results.
In this context, there was a general increase in costs, particularly personnel and ACMI costs, as well as aircraft maintenance expenses. These factors negatively impacted SATA Air Açores' accounts by almost €14 million.
The increase in revenue was insufficient to offset the rise in operating costs, impacting the company's EBITDA (earnings before interest, taxes, depreciation and amortisation), which fell from €11.4 million in 2023 to €4.6 million in 2024.
The net result for the year was a loss of €11.6 million, compared to a loss of €10 million the previous year. Notably, financial results decreased substantially (by €6 million) due to the early repayment of a €60 million bank loan in September 2023.
SATA Aerodrome Management increased revenue by 6%.
SATA Aerodrome's increasing revenue was in line with the increase in traffic at Azorean airports, mainly due to increased production at SATA Air Açores, and was recorded as operating subsidies.
Sales and services provided reached a total of €4.1 million in 2024, compared to €3.9 million in the same period last year — a 6.4% increase.
In addition, an estimated financial rebalancing of €1.2 million was recorded for the fourth year of the concession contract.
Operating costs totaled €5.7 million, an increase of €285,000 (5.2%) compared to 2023.
EBITDA for the year was negative at €245 thousand, €246 thousand lower than in 2023. The net result for the year was a loss of €244,000 — a variation of €572,000 compared to the previous year — due to a deterioration in EBITDA and an increase in restructuring costs resulting from a pre-retirement agreement.
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Glossary:
Load Factor: Total number of passenger-kilometres (RPK) divided by the total number of seat-kilometres (ASK).
EBITDA: Operating profit before interest, taxes, depreciation and amortisation.