TAP Air Portugal has posted its latest financial results for 2023, revealing a record-breakingly profitable year.
Over 100 million euros up on last year
The airline trousered a net profit of €177.3 million in 2023, outstripping its previous 2017 record. Up by €111.7 million on last year, the boost in profits was accompanied by a growth in revenue to €4.2 billion.
Luís Rodrigues, TAP’s CEO put the results down to successful deleveraging, investments in “our people” and new labour agreements and improvements in customer service.
An increase in punctuality and regularity in the second half of the year, as well as in the NPS, underscores the organizational focus on delivering a better service to our passengers.
Luís Rodrigues, CEO of TAP Air Portugal
Privatisation interrupted by election
Despite this apparent recovery, the flag carrier remains in yet another impasse in its seemingly interminable privatisation saga. The Portuguese government, dogged by scandal, finally launched the sale of a 51% stake in the national airline in September 2023. Its negotiation priorities at the time were announced as “national hub growth, growth and employment within the aviation sector, better utilisation of national airports and pricing.” But elections interrupted the process, which was supposed to conclude by mid-2024.
In the words of Portugal’s Finance Minister Fernando Medina, a TAP takeover would offer acquiring stakeholders “privileged connections” to the Portuguese-speaking world, including Angola, Brazil and other South American markets by extension, and Mozambique. Interested parties throughout the long-winded sale have included Air France-KLM, IAG, and Lufthansa.
A sharper eye on acquisitions and mergers
Though the sale has stalled, TAP’s CEO has insisted, speaking to Politico, that the roadmap towards continued profitability and TAP’s sale is still in place and that foreign investors’ interest remains keen, in an aviation sector that is seeing widespread post-Covid-19 consolidation.
That very trend for mergers, however, has drawn the beady eye of the European Commission, which is cracking down on airline acquisitions that are seen to skew the market or disadvantage flyers.
Lufthansa and the Italian government have already been informed that the Commission has objections to a proposed Lufthansa-ITA merger and wants “to ensure that the acquisition of ITA does not reduce competition in short- and long-haul traffic and lead to higher prices, less capacity or lower quality for passenger air transport services in and out of Italy, ” warned Margrethe Vestager, European Commission Executive Vice-President in charge of competition policy.
