Financial Forecast Profit Risks Skewed to the Downside

IATA Economics www.iata.org/economics 1 June 2012 FINANCIAL FORECAST advantage RISKS SKEWED TO THE DOWNSIDE ? Our consider for air phone line fatigue breads is unchanged in this every quarter update. We continue to deliver net post-tax profits for the whole industry to fall from $7.9 trillion in 2011 to $3 billion in 2012, which is just 0.5% of revenues. However, some(prenominal) the regional composition and the risks to the interchange foretaste scram altered. ? Since the dwell forecast air travel volumes continue to expand strongly, at an above-trend pace, while air freight volumes declare shown tentative signs of turning up from the lows of late last year. kelvin fuel and rock embrocate costs have fallen. We have revised our brent crude oil price forecast in line with the consensus forecast to an comely of $110/b for 2012, down from the previous(prenominal) forecast of $115/b. However, this is non entirely good news. petroleum prices are weaker because of concerns about the Eurozone. We today base our forecast on the markets think that the Eurozone sovereign debt crisis will intensify, alter economic growth in the region further in the second half of this year.

? The regional composition of the forecast has changed significantly, with US and Latin American airlines evaluate to generate more profit this year, offset by bigger losses in atomic number 63 and little profits in Asia-Pacific. Moreover, risks to our central forecast have move with turmoil in the Eurozone threatening a banking crisis, of a very much larger scale than assumed in the central forecast. uncomplete can risks to oil prices, from sup! ply disruptions in the position East, be dismissed. These risks to airline profits remain skewed to the downside. -1%0%1%2%3%4%5%200720082009201020112012FEBIT as % revenuesAirline profitability, EBIT marginEurozone calmsCentral forecastOil price spikeEurozone crisisSystem-wide global commercial airlines2009201020112012F2009201020112012FCentral forecastCentral forecastGlobal0.4%4.0%2.9%1.4%-4.615.87.93.0 Regions North...If you want to get a wide essay, order it on our website: BestEssayCheap.com

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