Airlines hit by biggest share drop since 9/11
The UK’s vote to leave the EU has taken a heavy toll on airline shares, particularly those in Europe, according to latest data from the International Air Transport Association.
It said that globally, airline shares dropped 11.6% in June and by the end of the month they were 21% below their level at the start of the year.
European airlines suffered almost a 25% month-on-month drop, the biggest since 9/11.
North American carries saw a 10.6% drop, while those in Asia saw the value of their shares drop 3%.
"The uncertainty of the Brexit vote, along with lingering impacts from recent terrorist attacks, has only added to existing investor concerns about the impact of falling unit revenues on profitability," said IATA.
"All told, global airline shares made the worst start to a year since 2008, and have underperformed the wider equity market by 21% so far in 2016."
While the financial markets have marked down their expectations of future industry financial performance, the latest financial results point to a robust start to the year for profitability, it added.
Net after-tas profits in the first quarter are more than 25% above the same quarter of 2015.
While the strongest financial results were once again posted by North American airlines, EBIT (earnings before interest and tax) margins increased in all regions compared with the first quarter of 2015.
Linsey McNeill
Editor Linsey McNeill has been writing about travel for more than three decades. Bylines include The Times, Telegraph, Observer, Guardian and Which? plus the South China Morning Post. She also shares insider tips on thetraveljournalist.co.uk
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