Swiss International Air Lines reported a reduced first-quarter loss on Thursday, helped by rising demand and cuts in its costs, jobs and network, and said again that it has the cash to keep flying.
Swiss, whose efforts to join the oneworld industry alliance hit a new snag this week, said its painful restructuring measures were now starting to pay off, with the full benefits expected to feed through in the course of this year and next.
But for now analysts said external factors had made a big contribution to the narrowing of the net loss to 78 million Swiss francs ($61.1 million) from a loss of 200 million in the first quarter of last year.
Results in the same quarter last year had been hit by the impact on air travel of the Iraq war. With the airline and other markets recovering and given Swiss' deep cost cuts, analysts said the improvement in earnings was no big surprise.
The company's auditor KPMG was also cautious about the airline's future.
"Should developments...occur which would prevent the company to meet the budget 2004 and which could not be compensated (for) ...liquidity and the ability to continue as a going concern might be seriously affected within the next 12 to 18 months," KPMG said in a note in the annual report.
The airline made a loss of 69 million francs at the earnings before interest and tax (EBIT) level in the first quarter, reduced from a 199 million loss a year ago.
Swiss still expected liquidity to slip to a level of more than 250 million francs in the second quarter, but this would be the lowest point before a likely recovery, it said.
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