COVID-19 pandemic still heavily impacted the airline’s EBIT
- In line with expectations due to the Covid-19 crisis, Brussels Airlines booked a loss of EUR 189 million in the financial year 2021, an improvement of 35% versus the previous year.
- Losses limited thanks to successful Reboot Plus transformation plan and strict cash management.
- Revenue up by 35% to 560 million, while operating expenses were only up by 5%
- Passenger numbers rose by 47% to 3.5 million.
- Growth in 2022 in terms of network, fleet and people
2021 was another year marked by the Covid pandemic and a year that still required a high level of resilience. The year started with a very limited flight schedule, in line with the low market demand due to high infection rates and lockdowns all over Europe, followed by a three-month travel ban issued by the Belgian government. This travel ban heavily impacted Brussels Airlines’ first quarter.
On 19 April, the travel ban was lifted and demand started to pick up again, while the vaccination campaign was also gaining velocity. What followed was a rapid increase in demand towards the summer. Brussels Airlines restarted full hub operations in June and built up its capacity from 12% to 53% of pre-pandemic levels towards the summer. The summer demand lasted longer than other years due to the effect of postponed travel plans and the desire to travel after the lockdown. This strong and prolonged summer peak led to a positive third quarter and the first profit since the beginning of the pandemic. November came with rising infection numbers and again many restrictions, causing the demand to decrease once more. The end-of-year holiday showed a strong travel peak, before returning to a lower winter demand due to the emergence of the Omicron variant.
After the restructuring phase of the Reboot Plus plan and the numerous changes undertaken, in November 2021 Brussels Airlines presented a new branding to strengthen its Belgian identity and to mark a new start after the coronavirus crisis. The new branding was an important signal towards the market that the airline is here to stay. As additional symbol for its future-readiness the decision was taken in June 2021 to add three Airbus A320neos to the Brussels Airlines fleet in summer 2023. With these new state-of-the-art aircraft and by retiring three older A319s, Brussels Airlines takes a significant step to the further modernization of its fleet and reduces carbon and noise emissions in its medium-haul network.
In the whole of 2021, the demand on the African network was again very resilient, mainly thanks to the business and VFR segments (Visiting Friends and Relatives), while the European segment was more volatile. All in all, the full-year capacity (Available seat-kilometres) was 62% higher than in 2020 and Brussels Airlines operated 39% more flights, welcoming 3.5 million passengers (+47%).
The passenger load factor was 1.1 percentage points lower than the previous year’s level, at 67.2% (previous year: 68.3%). Yields fell by 6.9% after adjusting for exchange rates. Traffic revenue increased with the expansion of traffic by 31% to EUR 503m (previous year: EUR 384m).
Revenue rose by 35% to EUR 560m(previous year: EUR 414m). Operating income rose by 31% to EUR 599m (previous year: EUR 456m). The Reboot Pluscost savings measures and strict cost discipline limited the increase in operating costs. At EUR 788m, they were only up 5% on the previous year. Higher fuel costs (+62%) due to increased prices and volumes as well as higher fees and charges due to volumes (+55%) were partially countered by lower staff costs (–17%).
In the 2021 financial year, Adjusted EBIT at Brussels Airlines was at EUR –189m (previous year: EUR –293m). The Adjusted EBIT margin was –33.8% (previous year: –70.8%). The EBIT was also at EUR –189m (previous year: EUR –332m). The previous year’s value was adversely affected by write-downs on the fleet totalling EUR 33m.
2021 key figures
Brussels Airlines successfully completed its Reboot Plus restructuring, creating a competitive cost basis for a profitable future
Brussels Airlines intensified its restructuring programme in response to the pandemic. “Reboot Plus” forms the basis for the airline’s sustainable future. As part of the programme, Brussels Airlines completed the restructuring phase. Two Airbus A330s left the long-haul fleet, and eight A320 family aircraft were removed from the short- and medium-haul fleets. The number of employees was reduced by more than 20% compared to the pre-pandemic level. Since January 2021, new collective labour agreements have been in place with all employee groups at Brussels Airlines to enable competitive staff costs. In 2021, the transformation plan entered a new phase, the phase of improvement and investment into technologies and simplification, to gain efficiency.
“This year we focused on the second phase of Reboot Plus, the improvement phase. We have been building the New Brussels Airlines. Our rebranding was a very visible symbol hereof, while behind the scenes we invested in a new crew scheduling tool, in our renewed office space and in a multitude of projects that either bring efficiency gains or simplification in our processes. I want to thank all Brussels Airlines employees for the achievements last year. Together we are building a bright future for our company.”
– Peter Gerber, CEO Brussels Airlines
Outlook 2022
Brussels Airlines will gradually increase its capacity to reach 80% of its 2019 levels by July, reinforcing its position as the home carrier of Belgium with a strong focus on leisure and reinforcing its position in Africa thanks to the 9th aircraft. For the entire year, the airline plans to operate 74% of its 2019 capacity levels.
“We have had some difficult winter months due to the Omicron wave, but we see a promising spring and summer in terms of demand. As travel regulations will dissipate and measures will be eased all around Europe, we foresee a return to 80% capacity of our pre-pandemic levels in the summer holidays. Cost-consciousness remains part of our DNA in order to reach structural profitability. In that respect, our plans remain unchanged: we aim for a black zero in 2022 and we remain committed to reaching 8% EBIT in 2024, under unchanged circumstances. Thanks to the successful implementation of our Reboot Plus plan, we have created the right foundation to grow and to look ahead to a profitable future.”
– Nina Öwerdieck, Chief Financial Officer Brussels Airlines
Brussels Airlines strengthens its market position in West Africa
In November 2021, it was decided to expand the long-haul fleet of Brussels Airlines with a ninth A330. With the additional capacity, Brussels Airlines will restart its route to Ouagadougou, Burkina Faso, and Conakry, Guinea, and increase the frequencies of its existing West African routes in 2022.
More growth was announced this week for 2022, as two aircraft will reinforce the summer operations at Brussels Airlines, allowing Brussels Airlines to reinforce its position as Belgium’s home carrier. To fuel this growth, Brussels Airlines announced earlier that it is hiring 288 people in all departments of the company.
In other news, Brussels Airlines has decided to add two aircraft to its medium haul fleet this summer season. This growth comes earlier than foreseen in its transformation plan (and state loan agreement) as it sees an opportunity in the increasing demand for summer. With one extra Airbus 319 and one extra A320, Brussels Airlines wants to cater to the high demand for leisure travel and defend its position in the market as Belgium’s home carrier.
Within the scope of Reboot Plus, Brussels Airlines rightsized its short- and medium haul fleet from 42 aircraft in 2019 to 30 in 2020. With especially touristic markets recovering quicker than initially forecasted, the airline decided to expand its capacity to reap this additional summer demand: The lease of one A319 will therefore be extended to October 2022 and the phase in of one A320 will be advanced to June 2022 in order to offer 80% of the 2019 summer production.
“We see clear signals that this crisis is slowly but surely coming to an end. The leisure segment in the market recovered more quickly than originally expected and we also see a slow but steady increase in the demand for corporate travel. By 2024 we should again reach the level of 2019 if it comes to the demand in the business travel segment. This is definitely the right time to increase our market share and once again confirm our position as Belgium’s home carrier.”
- Peter Gerber, CEO Brussels Airlines
This fleet expansion will give the company’s pilots, who currently have a parttime contract as was foreseen in its transformation plan in 2020 in order to keep all pilots on board, the possibility to return to a full-time working regime two years earlier than foreseen. On the cabin crew side, recruitments are ongoing. As it was promised in 2020, Brussels Airlines first contacted its ex-colleagues who did not see their contract prolonged that year due to the pandemic and the Reboot Plus program. 135 out of the 165 colleagues who were asked to return have accepted to work again for Brussels Airlines.
In December, Brussels Airlines already announced growth on its intercontinental sector, especially in Africa, thanks to a 9th A330 aircraft. This additional plane allows Brussels Airlines to increase frequencies to several of its destinations in Sub Sahara Africa and to resume its flights to Ouagadougou (Burkina Faso) and Conakry (Guinée), which were discontinued in 2020.
