But $11bn loss still likely - IATA
The financial performance of airlines improved in the third quarter, the International Air Transport Association (IATA) said.
But it maintained its prediction of an $11bn net loss for the industry for 2009.
IATA's Airlines Financial Monitor travel demand grew in September for the first time this year.
The Association said that while only a "handful" of airlines had posted their Q3 results.
But the early indications were than they had made a profit of $400,000 compared to a loss of $1.5bn in the same three months last year.
But it added that the Q3 figures had benefitted from seasonally strong traffic and warned that Q4 was "usually loss making".
During the three months, IATA said carriers had raised almost $8bn in new funds.
It added: "The industry has now raised $4.5bn in equity and over $20bn of new debt so far this year.
"The larger airlines now have a good cash cushion and the ability to finance much needed restructuring, if regulators allow."
IATA said airlines had been unable to cut capacity sufficiently when the market collapsed in the first half of the year.
It said that after the capacity cuts, load factors had remained flat throughout the year.
But it said supply-demand conditions were now improving as demand picked up.
It added: "The key question is whether capacity restraint will continue. Many airlines have announced further cuts for the winter season, but so far the published schedules suggest some increase."
IATA said passenger load factors on international markets had now returned to the levels and patterns of 2007.
"Seasonally-adjusted, aircraft are now as full as they were before the onset of the recession," the Association said.
IATA said fuel prices were also "creeping up" and stood at $85 per barrel in mid-October.
It expected further rises which would "continue to squeeze airline cash flows."
Fares were also now moving "in the right direction" but the pace of "improvement" was slow and were still "well down" on 2008.
In July, the Association said fares were down 18% in premium and 14% in economy over the previous 12 months.
It added: "Moreover, current low levels of aircraft utilisation and planned deliveries both suggest a threat to fares and yields in the months ahead.
"The revenue environment remains extremely challenging."
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