TAP posts net loss of €1.6 billion in 2021

TAP Air Portugal has posted a net loss of €1.6 billion for 2021, better than forecasted (€1.75 billion), including the recognition of non-recurring costs of €1 billion.

The first half of 2021 was marked by severe restrictions on domestic and international mobility due to the COVID-19 pandemic, leading to an almost total grounding of the airline’s aircraft for several months.

Throughout the second half, borders gradually reopened, although two of TAP’s main markets, Brazil and the U.S.A., only resumed international flights with Portugal during the last quarter of the year.

At the end of 2021, with the approval of the Restructuring Plan and with the objective of concentrating TAP on the core air transport business, the decision was taken to sell or to shut down some of the subsidiaries, namely TAP ME Brasil, whose historical performance had been reflected in growing accumulated losses.

Thus, as part of the corporate restructuring of the TAP Group included in the restructuring plan, an extraordinary impairment on the account receivable from TAP SGPS was recorded, which represents most of the non-recurring operating costs recorded in Q4 2021.
Despite the slow reopening of borders, particularly outside the Schengen area and the spread of the Omicron COVID-19 variant, TAP was able to limit the losses resulting from the forced grounding of its fleet.

Recurring EBITDA in the second half of 2021, offset the operating losses recorded during the first half, allowing 2021 to close with a positive recurring EBITDA of €11.7 million.

In the last quarter of 2021, in the context of the restructuring and reorganisation plan of TAP SGPS, TAP recorded a non-recurring cost item of €1,024.9 million impacting the results.

In operational terms, the number of TAP passengers grew by 25.1% (YoY) in 2021, still around 34.2% of the 2019 level. The demand (measured in RPK) increased by 25.6% (YoY), although still 35.5% of 2019 figures. Passenger revenues increased by 25.8% in 2021, above the overall 20.1% (according to IATA) growth in industry passenger revenues.

Total operating revenues reached €1,388.5 million, an increase of €328.4 million (+31.0%) compared to 2020 operating revenues. Passenger revenues increased by €218.8 million. Cargo and mail revenues were up 88.0% (EUR 110.5 million), fully offsetting the decline in maintenance revenues of €13.7 million YoY (-20.1%). (£1.00 = €1.20 at time of publication).

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