Iberia’s gross benefits drop 36.6 percent

Iberia’s gross benefits for the first three quarters of the year plummeted a staggering 36.6 percent from 175.15 million euros in 2002 to little more than 111 million euros this time around, sources close to the airline’s front office informed.

The same sources cited a number of factors that have pushed the company’s benefits down. For them, the premiere cause is the emergence of a brawnier European currency compared to the dollar, especially when roughly 18 percent of all plain ticket revenues are collected in greenbacks.

Airfare sales peaked 3.4 billion euros between January and September, 3.2 percent below the numbers posted in the same span of time last year when the carrier made 3.6 billion euros.

Earnings per passenger took a 6.5 percent plunge from 2.7 billion euros in the first nine months of 2002 to 2.5 billion euros in the first three quarters of 2003.

Cargo-related revenues went down 4.5 percent, yet they were somewhat offset –the company says- by larger earnings out of the areas of handling and shipping (up 16.6 percent), maintenance (22 percent) and other services (22.4 percent).

However, Iberia experts explained that the carrier is applying a stricter cost-cutting policy and is sticking to the idea of keeping offers very much in sync with demands. Iberia is now wrapping up the first stage of its 2003-2005 Management Plan.

The cost-cutting process got a big boost in the third quarter of the ongoing year as a result of less spending in staffing, fuel (75 percent of its fuel stock went in the neighborhood of $23 to $26 per barrel) and fleet leasing.

Iberia execs believe those upshots have given the company some wiggle room to breathe easier at the end of the year, mainly stemming from the carrier’s good handling of the offer-demand ratio.

For the last quarter of the year, the company expects to rake in bigger revenues and implement a nonstop cost-cutting policy as long as the Management Plan continues to be applied to the letter.

For the oncoming year, Iberia is gunning for as many as 5.4 billion euros worth of revenues.