Thank you very much for standing by. Please note there will be a Q&A session following the presentation by the speakers, which will consist of written questions only. If you'd like to participate in our written Q&A, just type your question into the Ask a Question text area and then click the Submit button. With that, I'll now hand you over to our speakers. They are Associate Professor Murat Şeker, Member of the Board and the Executive Committee, as well as the Chief Financial Officer, and Mehmet Fatih Korkmaz, the Head of Investor Relations. Speakers, the floor is yours.
Thank you very much. Good afternoon, everyone. Thank you for joining us today. As we meet today, we still feel the pain of the earthquakes that struck Türkiye just over 2 months ago. The effects of this tragedy have been far-reaching. We continue to share the sorrow of everyone affected. Before going into the details of our Q1 performance, I would like to mention our vision for the next 10 years. Last month, we announced our strategic plan for Turkish Airlines centenary in 2033. Our unwavering commitment to sustainable and profitable growth is at the forefront of this plan. Over the last 2 decades, we managed to grow at twice the pace of our industry, making a significant contribution to Turkish economy. Our aim is to generate more value for our stakeholders and customers in the coming decades.
As a leading global airline, our vision is to continue growing by connecting over 170 million passengers to more than 400 destinations with a fleet of over 800 aircraft by 2033. Our goal is to achieve consolidated revenue of over $50 billion by 2033 through expanding our passenger network, creating a logistic ecosystem around our cargo business, and transforming AnadoluJet into an LCC. Combined with strict cost discipline, we are targeting to have an EBITDA margin between 20%-25% around 2023-2033. We have started to work on the projects to carry out our strategy, and we'll be meeting with our investors to elaborate further on the planned actions. Now, I would like to turn your attention to our Q1 results.
2023 had a strong start, although the devastating earthquakes created a headwind for the financial performance. Thanks to the exceptional work and unwavering dedication of the Turkish Airlines team, we carried more than 17 million passengers during the Q1 , rising 35% year-over-year. As the contribution from international flights increased following the lifted restrictions in Far East, total load factor climbed by more than 11 percentage points to 81.3%, exceeding the 2019 levels. Our revenue performance in the Q1 saw significant improvement compared to the previous ones as a result of the robust passenger traffic. Our total revenue for the quarter reached to $4.4 billion and was recorded as our highest Q1 revenue. Passenger revenues increased by over 80% compared to Q1 of 2022 and surpassed $3.6 billion.
Our cargo revenues, on the other hand, amounted to $590 million, despite the decrease in global cargo demand and a $75 million of potential revenue loss due to the dedication of capacity for the earthquakes. We are managing our cargo yields relatively well compared to the industry. In the Q1 , we generated a profit of approximately $110 million from our main operations and achieved an EBITDA of $769 million with an EBITDA margin of 17.7%. Net income was realized as $233 million, marking our seventh consecutive profitable quarter. This is particularly noteworthy as the Q1 is generally considered the weakest due to seasonal factors.
Excluding the financial impact of the earthquakes and personal bonuses paid, profitability figures would be $240 million higher in the Q1 . This quarter's traffic results and current forward bookings reveal confidence about the demand strength for the rest of the year. Also, we expect the industry's supply-demand imbalance to continue in 2023. Lack of sufficient aircraft and workforce availability in the sector will constrain growth in the robust demand environment. Recent strikes across European airports, expected congestion in the European airspace, and manufacturing problems, along with aircraft delivery delays, exacerbate the imbalance further. Considering these factors, we aim to increase our passenger capacity in the Q2 by 10%-15% year-over-year. I will now hand the presentation over to Fatih Bey to elaborate on our key financial results and provide additional insights.
Thank you, Murat Bey. Good afternoon, everyone. In the Q1 , we continued to increase our passenger capacity parallel to the robust demand environment. Capacity and load factors surpassed the same period of 2022 by 33% and 11 percentage points respectively, mainly attributable to our international operations. As a proportion of the pre-pandemic levels, our international passenger capacity remains substantially above European and global averages. Our transfer traffic at Istanbul Airport continued to gain momentum. The number of international passengers increased by 71% compared to last year and reached 25% above pre-COVID levels. Similarly, our total number of international passengers rose by almost 50% year-over-year, surpassing 2019 figures by 20%.
As you remember, in 2022, Turkish tourism was the first one to fully recover to pre-pandemic level, and Turkey was the third most visited country in the world with over 51 million guests. Carrying over half of these visitors last year, we will strongly contribute to Turkey's target of 60 million tourists in this year as well. From a regional perspective, Far East was the top performer following the lifted restrictions and the end of China's Zero-COVID policy. As we increased our capacity in the region by over 50%, number of passengers rose by 90%. The recovery of the business class was also quite pronounced, with the segment load factor increasing by 26 percentage points. The acceleration of business and leisure activities, along with an increase in group reservations, contributed to higher yields throughout the region.
Network and schedule consistency are particularly important for Far Eastern travelers. Turkish Airlines becomes the preferred choice for transit travel. The commencement of Umrah travel to Saudi Arabia supported traffic into the Middle East from all over the world. This resulted in 6 percentage point increase in load factor year-over-year. The Saudi government's simplification of visa procedures for Turkish citizens also played a major role. We also experienced healthy growth on our routes to Europe and Africa. The number of passengers in those regions rose by 40% and 28%, respectively, with significant increases in revenue yields. Strong ethnic demand, along with the higher business class preferences, resulted in almost 30% higher revenue yields in Americas despite an 18% increase in capacity.
Since the beginning of this year, our daily passenger sales have been significantly higher than last year and 2019. Even though there was a relative slowdown at the beginning of February due to earthquakes and bad weather conditions, currently, we are not seeing any impact that feeds into our forward bookings. As a result, our passenger revenue growth trajectory continues to be encouraging. As our passenger operations gain strength, its percentage contribution to total revenue base normalized from the pandemic lows. In the Q1 , passenger revenues were recorded as $3.6 billion and constituted almost 84% of our total revenues. Our cargo revenues, on the other hand, decreased by 40% year-over-year to $590 million, mainly due to the global oversupply pressures.
Excluding transportation of 29,000 tons of aid materials to the affected area, we would have carried the same amount of cargo as last year. This translates into 3 percentage points drag on the cargo yields. Our ongoing support to the earthquake region also had a $25 million negative effect on the cargo revenues in April. We also expect a limited impact on cargo from the relief efforts in May. On an international basis, cargo demand continues to be under pressure. Tighter financial conditions, decelerating global trade, and easing supply chain bottlenecks resulted in declines in global cargo prices. As global air cargo capacity returns to pre-pandemic levels, increased availability of vessels is also creating a more space for cargo. However, this has been partially offset by slower vessel speeds.
In recent months, the decline in the air cargo demand was less pronounced and showed signs of bottoming out. It is possible to see a stabilization in the air freight rates in the second half of the year. Before going into next slide, I also would like to mention Turkish Technic. One of the most important players in the global aircraft MRO industry, our subsidiary recorded successful growth in the last two decades. As we announced in March, the company increased its total revenue by almost 40% year-over-year to $1.4 billion, and increased global market share to 1.9%. In the Q1 of this year, Turkish Technic continued its growth trend and increased its revenues by 44% to almost $400 million. Let us now head to the financial highlights.
As you can see, our liquidity increased by around $580 million in the Q1 to almost $5.3 billion. Strong operational cash inflow reduced net debt to $8.4 billion as of March 31st, from its peak at the end of 2020. As a result, the net debt to EBITDA multiple decreased to its lower level of 1.7 times by the end of the Q1 . Increasing passenger yields and volume led to more than 80% higher passenger revenues in the Q1 compared to the same period last year. Together with the contribution of cargo operations, total revenues exceeded 2022 level by almost 43%. Strong operational performance translates into $770 million of EBITDA, up more than 8% versus last year.
In the Q1 , we had several one-off items due to the extraordinary circumstances. Following the earthquakes in February, we utilized all of our resources to help people in need. With the responsibility of being the flag carrier of Turkey, we conducted evacuation flights and transported relief materials to the region. These operations had an $82 million of negative impact on our profitability on a net basis. Furthermore, in order to contribute to alleviating the adverse effect of the earthquake as much as possible, we donated around $106 million in cash to the Ministry of Interior Disaster and Emergency Management Presidency. On the positive side, we recorded around $50 million of compensation in income related to the aircraft deliveries and $34 million of expired ticket revenues.
Excluding these one-offs and personal bonuses amounting $50 million, our profitability figures would be $240 million higher. Looking at the unit expense breakdown, we recorded a 9% increase during the Q1 compared to the same period last year. The main drivers of this increase were higher jet fuel prices, earthquake impact, and bonuses paid to our personnel. Furthermore, higher services and catering unit expenses were due to escalated food inflation, which compounded with the bonuses paid to our subsidiaries. Excluding one-offs, our actual cost would decrease by around 2% instead of recording 5.5% increase. In the Q1 of 2023, the capacity and passenger numbers of AnadoluJet rose by 18%, while its revenues increased by more than 30% compared to the same period last year.
With 13 additions in the 3 months to March, its number of aircraft reached to 77. We are aiming to expand its fleet to 86 aircraft by the year end. In line with our 2033 targets, we continue investing in AnadoluJet by redesigning its revenue and cost base to attain higher profitability levels. We already launched its digital transformation with the implementation of a new passenger service system. This will allow us to utilize better inventory management and pricing by specifically targeting the demand patterns of price-sensitive customers. It will also allow us to enhance our product portfolio and bundling opportunities to increase ancillary revenues further. In the upcoming quarters, we will also unveil AnadoluJet's new corporate identity and brand repositioning, followed by its incorporation next year. On the network side, we will strengthen its international east and west axis by increasing frequency, depth and breadth.
Our aim is also to benefit from advantages of having a younger fleet, upgauging through increasing new generation aircraft composition to 98% until 2028. With these projects, we are targeting to decrease AnadoluJet's unit cost by at least 20% while increasing its unit revenues by 25% to widen its profitability margin. Now let me briefly talk about 2023 expectations. For the entire year, our capacity is expected to be somewhere between 15% and 20% higher than the last year if we can get our aircraft deliveries on time. Currently, we don't see any significant change in the demand pattern for the upcoming summer season. Yet, we will continue to monitor our booking curve, global travel appetite, macroeconomic environment, and adjust our projections accordingly.
On the cost side, our ex-fuel unit cost target is slightly higher than 22 by a mid-single digits, mainly due to one-off impacts from relief efforts related to earthquakes and bonus payments. Gross CapEx this year is expected to be around $5 billion-$5.5 billion, including aircraft and other fixed investments. With this, we conclude our presentation and now we can continue with the Q&A session.
Thank you. Thank you, speakers. Thank you very much for your presentation. Yes, ladies and gentlemen, it's time now for our question and answer session, which will consist of written questions only, no audio. If you'd like to participate in the written Q&A, just type your question into the Ask a Question text area and then click the Submit button. With that, back to the speakers for those questions. Gentlemen.
Hello again. Murat, analysts are wondering about the effect of the earthquakes on our operations and financials in the Q1 .
Sure. The overall operational impact of the earthquake on profit was roughly around $190 million. As we have announced earlier, we donated for the earthquake support of an amount of around $110 million. We provided humanitarian flights to and from the earthquake region. It had an effect on profitability, roughly around $80 million, $84 million, $85 million. Overall, the impact was so far on the Q1 was about $190 million. What's the only remaining item here is the we promised to construct 1,000 house residency in the earthquake-affected cities, and that will cost, roughly speaking, $75 million.
Overall, the impact will be around $250 million, the overall amount of donations we have provided for the earthquakes.
Continuing with the earthquake impact, what was the effect of the earthquake tax on your financials?
This tax, actually only we are affected through the dividend incomes that we get from our subsidiaries. It's limited. We expect that to be on the vicinity of $5 million for Turkish Airlines.
Regarding operating environment, do you feel increasing pressure from rising competition on a global scale as the countries open up fully and also to Turkey, as there are quite a few new entrants to the market?
We sure do feel the increasing competition in the market, especially after the Asian market open up. Last year, we were really having a dominance in certain regions in our operations. However, the constraints due to the aircraft and workforce availability limit the competitive pressure since the demand is quite strong and the current supply-demand dynamics seem to play in our favor. Yet, we expect the competition to be escalated, especially in the second half of the year as the airlines are putting all the capacities back in the operation. Regarding to the competition in Turkey, as demand to Turkey grows quite fast, we are not experiencing a direct impact on our arrival traffic due to the new arrivals in the market.
Remember that the number of airlines and charter operations that got bankrupt during the pandemic still leaves a larger portion of the markets to the network carriers like us. That gap is going to be filled by us, which is going to relatively decrease the impact of the competition on our bottom line. We keep iterating it, that we have a very strong network. We are covering together. We are flying to almost 280 points in 130 countries. Together with our codeshare agreements, we are connecting more than 500 destinations. 500 points we can reach with our network. That gives us a lot of edges to meet the competition. We keep increasing these agreements.
You know, last year, sorry, this year we added, IndiGo, and then very recently with airBaltic, we signed a new agreement. We are trying to keep ahead of the competitive pressure.
Regarding the drivers of the Q1 results, what factors contributed to the performance?
Well, as I said in the earlier question, the diversity and the large number of points we are operating is one key factor. As a result of which number of international passengers increased by almost 40% compared to the Q1 of last year, and load factor increased by 8 percentage points. The yields were significantly above 2022 yields. On the passenger side, we had a very smart results. Despite the deterioration in global air cargo demand and the yields, our cargo business still has a higher margin than 2019 level. Despite the high inflation and earthquake-related costs and personal bonuses, ex-fuel unit cost increase was limited to just around 5% in the Q1 . This also contributed our attaining this nice Q1 results.
In the first part of our call, we mentioned about number of one-off items. Could you give us the details of these items? Also, what should we expect for the rest of the year?
The factors that had a positive effect on the Q1 financials is we had an, as we announced earlier, because of there were late deliveries of 787s and our wide-body aircraft and some of the some also narrow-body front, we generated some income from these late aircraft deliveries. The expired ticket revenues together made around $80 million positive contribution to our bottom line. On the negative front, the earthquake-related expenses, which I just mentioned, and the personal bonuses were adding up to roughly $240 million. These were the one-off factors that we saw in the bottom line for Q1 .
Could you give us any color on the current state of the passenger operations and forward bookings?
In contrast actually to the historical trend, we did not experience a decline in revenue yields as we moved from Christmas holiday season to January. That was a positive surprise. We are seeing continuation of quite robust demand environment network-wide. The opening up of the Far East and starting the religious travel season for Muslims have significantly supported our bookings. Currently, we are not seeing any materially negative impact from the earthquake in our forward booking, and we expect increasing competition in Europe in the Q2 and higher competition from the Far East region in the second half of the year. So far, we have not seen this competitive pressure putting further pressure on our yields and bookings.
Continuing with the output questions, what are your capacity and yield expectations for 2023?
2023 capacity is expected to be around 15%-20% higher than 2022 level. Far East and Middle East regions are the main drivers of capacity increase, and we have provided details in our IR presentation. Capacity planned in the Q2 of this year is also going to be around 10%-15% higher than last year. Overall, we are anticipating low single-digit increase in passenger yields in this year compared to last year.
With those expectations, is it possible to provide updated revenue and profitability expectations?
On the revenue front, we are expecting a low double digit on the vicinity of 10% increase in the revenues compared to 2022. EBITDA margin is expected to be between 22%-25% levels, which is close to the upper band. These are in line with the guidance we provided in our year-end investor calls.
As we are heading to cost questions, what ex-fuel costs should our analysts expect for the full year, and what are the main pressure points?
Ex-fuel cost increases for this year is expected to be up around like mid-single digits, mainly due to the aforementioned one-offs. Also as we ramp up our capacity quite significantly, impact of the fixed costs are going to decrease, and this will allow us to mitigate some of the inflationary pressure. In order to maintain our competitive cost base, we are continuously monitoring our OpEx and CapEx plans. Yeah, on the ex-fuel cost side, we expect that to be around mid to high single digits for this year.
What is the expected fuel unit cost for 2023, and what are your assumptions? Including hedges.
We expect the fuel cost to decrease, including hedge, by around 15%-17%. This mainly the sharp decline in Brent has accommodated this cost for us, and this is going to provide a significant positive contribution for our profit guidance. This assumption does not, of course, reflect the recent declines in Brent prices and crack spread. Further decrease in cost could be seen. We are just waiting to see how material and how long-lasting this most recent decline in Brent price is going to last. As of now, as of currently, our hedge ratio for 2023 is around 12%, and the break-even price is around $79. For the whole year, we expect we keep adding new hedge positions, and we expect to finish the year with around 20%-25% hedge ratio.
Continuing with hedging levels, what levels are you comfortable with?
Well, the recent decline, as I was saying, the recent decline in the prices takes us in an advantageous position compared to our peers, considering our currently low hedge levels. Also contribution of ticket surcharges, we are able to cover significant portion of our fuel expenses, more than 60%. Roughly 60%-70% of our overall fuel expense can be covered by the surcharge, ticket surcharge and our hedge positions.
We are now heading to liquidity and CapEx questions. Can you provide your year-end expectations for the liquidity levels?
we finished actually last year with about $4.7 billion liquidity. as we look at the first four months, we are well above our 2022 daily sales levels, which resulted in working capital accumulation. this year we project to add further around $700 million-$1 billion cash inflow and which can take us to $5.2 billion-$5.5 billion cash level by the end of the year.
Considering that in mind, what is the CapEx and PDP plan for 2023?
Depending on the, of course, the aircraft deliveries, gross CapEx for this year is expected to be around $5 billion-$5.5 billion. We anticipate a quite limited PDP outflow below $100 million probably. Of this $5 billion, $5.5 billion CapEx, $3 billion is for aircraft financing, new deliveries, and the remaining $2 billion-$2.5 billion is for heavy maintenance, spare engines, and some infrastructure needs we still keep having in Istanbul Airport.
What is the expected net debt levels by the year-end?
As we presented in the slides, it came down as low as $8.4 billion dollar. As we will be adding new deliveries, new fleet, this is going to increase to probably around $9.5 billion dollars. Our net debt to EBITDA multiple, we expect that to be around 2 times for 2023.
What is expected year-end fleet size? Could you provide details regarding the aircraft entries and exits?
Overall, this year we are expecting 55 entries and 14 exits, which will take the year-end fleet size to 435. Overall 55 entries and 14 exits. This shows that despite there are issues with both OEMs in delivering aircraft, we were able to add a significant growth in our fleet size in 2023. A little bit more detail is of these deliveries, roughly 20 will be for Turkish Airlines and about 30 for AnadoluJet and 4 for cargo. AnadoluJet is important because these are all new generation aircraft, and it also going to allow us to retire some of our old and fuel-inefficient aircraft for AnadoluJet. It will have a significant contribution to the profitability of our low-cost arm.
Murat Bey, do recent Boeing MAX manufacturing problems have an effect on your current fleet and delivery timetable?
We, as soon as the issue came up, we got in touch with the Boeing representatives and have been monitoring the developments very closely. So far, we have just 32 MAXes in the fleet, we expect to take two more this summer. These recent problems, issues had a very limited concern for us. We have not ground any aircraft yet, and they don't seem to have any material impact on our MAX operation.
Murat, on the context of the new strategic plan, what will be the estimated size of the aircraft orders, and when will you make the announcements? How will you secure these orders considering the sizable backlog on the OEM deliveries?
As I said, by this year, we are going to be reaching 435, by 2033, we're expecting to reach a fleet size of 800. Currently, with our firm orders with both Boeing and Airbus, we are going to have 80 deliveries until 2028. 45 of these deliveries are going to come within the next three years, 2024-2026, so excluding 2023. As I was saying in the earlier question, this year we are going to get 55 deliveries. Of these 55 deliveries, only 17 is going to be directly from Boeing and Airbus. Which means that we have a lot of capacity available through the lessors to Turkish Airlines.
As our being a big network carrier and being a solid airline, we are on top of the list of lessors in getting new aircraft. We are being able to find solutions to meet our growth targets. Regarding to our big strategic plan, of course, very soon we are going to be in a position to place a large order book, could be around 200, even up to 300 aircraft through an RFP. We are still working on that. Overall, the backlog on the OEMs, which we have a quite strong relationship, we believe once we have our RFP out, we will be able to meet our needs through the both OEMs in the coming years.
Before heading into the subsidiaries questions, we have a question for our cargo operations. Could you please comment on the cargo unit revenues in the last quarter and your forward expectations?
About the cargo, of course, the yields have been eroding. This is something we were expecting. We were preparing for these days to come. We have seen extremely high yield environment on cargo operation over the last two consecutive years, and we were seeing some erosion towards the last quarter of 2022. The Q1 came of a yield erosion of around 30%. Of course, the Q1 of the 2022 was still where the pandemic was still highly affecting a large portion of the world, and air cargo was in high demand, and the capacity was missing. In the Q1 of this year, we see more capacity available, and yet the yields are eroding. There are two factors that are affecting overall cargo revenues to decline.
Where we are with the cargo yields, we are still above 2019 levels. Given the vast network of our cargo operations, which we are flying to more than 300 destinations with our cargo, we can carry cargo to and from, we don't think the decline is going to be very dramatic. I mean, the yields are going to keep declining year-on-year. They probably will decline around 20% compared to 2022. We think the compensation on the passenger side is going to be quite strong to compensate these losses.
Murat, could you please comment on AnadoluJet's planned spin-off, mentioned in the strategic plan, and regarding the new runway in Sabiha Gökçen?
In the fleet size is going to reach 86 aircraft by the end of the year, and we finished the quarter with about 77 aircraft for AnadoluJet. They keep growing, and they keep dedicating more and more capacity to their international operations. In our strategic plan, we expect to reach a fleet size of about 200 aircraft for AnadoluJet by 2033. We already started to redesign its revenue and cost base to attain higher profitability levels. Its new PSS will allow us to utilize better inventory management and better pricing. That project is undergoing. We are in the coming months, unveil AnadoluJet's new corporate identity and its new brand. With our current projections, we expect to spin AnadoluJet off by the beginning of 2024.
After the completion about the Sabiha, after the completion of the second runway and the completion of the renovation of the first runway in Sabiha, our growth will come from the significant international capacity, which will increase gradually to 75% of total AnadoluJet capacity from the current level of 55% level. We are aiming to create an international hub in Sabiha Gokcen Airport for AnadoluJet.
Murat, is it possible to provide further details about the new collaboration with Emlak Konut? How will this project affect the bottom line?
Actually, this is not a new collaboration. We purchased a land, a large amount of land, somewhere close to Istanbul Airport area in 2018 with Emlak Konut. As we moved to Istanbul Airport in 2019, we were planning to start a large apartment complex housing project with Emlak Konut. The pandemic came in, we did not have the chance and have the funding available to finance such a project. As now our liquidity level is more generous, we are in a phase to start this project. In the coming weeks, we will announce it. A total of roughly, the numbers are not exact yet, but roughly 14,000 residential units is expected to build in that, in part of our land with Emlak Konut.
Of those units, a portion will be dedicated to Turkish Airlines staff, and the remaining will go to the individual interested parties. All the proceeds of this project is going to be split between Emlak Konut and us. We are 50-50% shareholders of the land. We expect a sizable profit from this project, considering the current high real estate value in Istanbul and significant increase in the value of the land we purchased in 2018.
Could you elaborate on the plans about your new subsidiary, Turkish Support Services? What is the main reasoning behind this decision?
We, as the Turkish Airlines and our main subsidiaries, Turkish Technic and TGS, ground handling subsidiary, we do use a lot of stuff, and we wanted to combine all these different service-providing companies under one roof. Our main motivation was to streamline the operations, increase the efficiency, generate cost advantages, optimizing our human resources, and establishing more quality protocols. So far, we transferred approximately 7,500 employees by the beginning of May, and we expect to reach a workforce size of, roughly speaking, 11,000 individuals by the end of July.
Hopefully, by this project in Turkish Support Services, with when we combining all this service under one roof, we will be eliminating a lot of commissions paid to those third parties, we'll be able to benefit from the economics of scale. There will be, of course, cost saving through lower overhead costs.
Murat, we got one question regarding sustainability. How are you planning to comply with IATA's net zero by 2050 and EU's Fit for 55?
Well, we shaped our strategy actually for 2033 around the sustainability targets. to become a carbon neutral until 2050 was quite important motto for our, in our strategy. Also considering the EU's recent regulatory development in line with Turkey's ratification of the Paris Agreement. EU's Fit for 55 regulatory package aims to reduce emissions by at least 55% by 2030. under this regulation, our airlines are required to use SAF on all flights departing from EU by 2025, starting with 2% SAF rate and increasing over the years, which we have already started. We are using SAF in about 11 routes in Europe. by this regulation, we are expected to increase this rate to 85% by 2050.
We are trying to comply with these regulations through fleet modernization and using renewable energy sources, offsetting emissions under CORSIA, and improvements through operational targets such as fuel management systems.
Mert, we also got one question from Anton from Citi. Actually, you answered some part of the questions, his questions, but maybe you would like to add something to those items.
Sure. Yeah. As already mentioned, due to the inflationary pressure, we don't expect downward pressure in pricing. As you know, we have price caps in domestic sales, yet most of the sales are made closer to the price ceiling in summer season. We have quite close contact with the related authorities to negotiate the price cap, but that seems to continue probably throughout 2023. About the Brent, we see a decline both in the fuel and jet prices, and decreasing the fuel price will have positive effect on bottom line. Average Brent was taken around $84 for the remaining part of the year. It seems if these lower prices are to stay, we might revise our projections, and it might have a further positive impact on our profits.
Yeah, I think that's about it.
Just one additional question from Aysegul Bora from Onyx for Neighboris.
Turkish Airlines is currently not involved in any JV partnership. Well, I mean, partnerships and joint venture structures are areas we have an appetite for in MRO business, in airlines, in especially places where we have, where we want to expand our network, and they are the far destinations. In Americas, in Far East, we have been engaging in some preliminary discussions with some airlines, but there is nothing material on this front yet.
Mert, I think, this is the last question. I would like to thank all of our participants for their patience, and we hope to see you in our next earnings call.
Right. Thank you very much, Can, for the presentation. If there are no other thoughts or conclusions, that concludes today's webcast call. Thank you for your participation.