The Global Airlines Financial Monitor: May 2017

Global airline share prices performed strongly in May, surging 7.8% to be up more than 20% over the past year. Gains were observed in all 3 regions, but European airline shares led the way again this month, with a 14.3% rise.
The latest financial results for Q1 provide further evidence of the squeeze on airline profit margins, reflecting higher costs and weak yields. Industry-wide free cash flow also eased in Q1, compared with the outcome in Q1 2016.
The fall in Brent crude prices in April extended into May and despite some recovery, the monthly average price fell almost 4%. Jet fuel prices behaved in a similar fashion and were down 5.6% for the month overall.
The strong start to the year for passenger and freight demand growth has continued. The passenger load factor set a new record high in April while freight loads consolidated recent gains.
Growth in premium passenger traffic has exceeded its economy counterpart in many key markets in the past year.
Passenger yields remain 3-5% lower than a year ago amidst ongoing signs that the downward trend in yields of the past three years may have bottomed.