Korean Air achieved record high revenues in 2023

Korean Air reported its full-year 2019 earnings and plans to fully restore passenger numbers and capacity in the first quarter of 2024.

Korean Air released its financial forecasts for the fourth quarter and 2023, which showed that in 2023 the airline generated a record high revenue of USD 11.3 billion with an operating profit of USD 1.23 billion, and in the quarter ended December 31, 2023 (Q4 2023). Korean Air also recorded a record quarterly revenue of USD 3.09 billion. This was reported by simpleflying.com.

Revenues outpace pre-COVID-19 levels

As travel restrictions in Northeast Asia are now a thing of the past, Korean Air has quickly restored seat capacity and is preparing for a busy 2024. Compared to pre-pandemic 2019, the airline increased passenger revenue by 16% and load factor by 1.9 percentage points, but available passenger kilometers are 20% lower and revenue per passenger kilometer is 18% lower than pre-pandemic levels.

Annual revenue in the passenger business increased compared to 2019 due to strong travel demand and higher demand for premium travel, even though network capacity has only recovered to 80% of pre-pandemic levels. In 2023, Korean Air's revenue was USD 11.3 billion, operating profit was USD 1.23 billion, and net profit was USD 711 million, compared to USD 10.4 billion, USD 2.23 billion, and USD 1.38 billion, respectively, in 2022.

The operating profit in 2023 was higher than in 2019, and the operating profit margin of 10% achieved last year was significantly higher than the industry average. Operating profit in the fourth quarter of $142.4 million was 65% lower than in the same period in 2023, which, according to the Korean company, is due to higher staff salaries, including incentives for achieving annual productivity and safety goals.

Cargo turnover remained stable in 2023

Korean Air has been consistently performing well in the cargo market, and in 2023, all of its cargo metrics were ahead of 2019, including revenue, which grew by 58%. The carrier attributes the excellent result to global supply chain issues, bottlenecks in maritime transportation, and limited cargo capacity on board aircraft.

However, Korean Air warns that as the air cargo industry has recovered from the pandemic, operating profit from cargo transportation has declined compared to 2022. In the first quarter of 2024, demand for traditional commodities such as semiconductors, automobiles, and displays remains uncertain due to the weak global economy, although there is steady demand from the e-commerce sector.

As for the passenger transportation market in 2024, the airline expects demand and capacity to fully recover by the end of March. Korean Air reported that demand for long-haul flights is expected to remain stable and predicts that the recovery in travel demand during the peak winter season will increase revenues. The carrier also plans to maximize its revenues by reopening routes and increasing capacity to popular tourist destinations in Japan and Southeast Asia, in Australia, Korean Air is one of the fastest-growing airlines, especially on the Seoul-Sydney and Brisbane routes.