Stockholm - The SAS Group, the operator of the joint carrier
Scandinavian Airlines, on Wednesday posted a pre-tax loss for third-
quarter 2008, citing high fuel costs, the economic downturn and a
goodwill writedown in its Spanish-based carrier.

SAS chief executive Mats Jansson said the group needed to implement
more belt-tightening measures saying the "crisis in the air travel
industry strikes indiscriminately."

He noted the recent bankruptcy of low-cost rival Sterling Airlines, one of some 30 carriers to fold so far this year.

The SAS Group posted a third-quarter pre-tax loss of 1.78 billion
kronor (231 million dollars) compared to a pre-tax profit of 457
million kronor in the corresponding business period of 2007.

Third-quarter sales were 16.36 billion kronor, slightly up year- on-year.

A sizeable chunk of the loss was attributed to the 1.96-billion-
kronor writedown of goodwill and tax assets in the Spanair subsidiary,
SAS said.

The SAS share was down some 3 per cent at midday.

Cost-cutting measures were continuing with the short-term Profit
2008 programme that had produced savings of 1 billion kronor of a
targeted 1.5 billion kronor, and reducing aircraft capacity by 10 per
cent or 33 planes, including 15 operated by Spanair.

Jansson said Spanair bookings were back to normal after the August
20 crash in Madrid that killed 154 people, but earlier cost-cutting
measures were to continue.

The SAS Group needed greater overall savings, Jansson said of the
long-term programme dubbed S11. To date the group had achieved three-
quarters of the 2.8 billion kronor savings target, but a further 3 to 4
billion kronor were needed by 2011.

These savings hinged on the outcome of ongoing talks with unions,
Jansson said, declining to detail what specific demands mangement had
made but he said the unions were "fully aware" of the situation.

Jansson declined to comment possible takeover offers from other
carriers but said "that track is still alive." Germany's Lufthansa is
often mentioned in speculation.

The stronger US dollar had offset the recent drop in oil prices,
Jansson said, adding that travel would be impacted by "a further
deepening of the recession by the financial crisis."

At the end of the quarter, the SAS Group had 24,298 employees.

The SAS Group flew 9.8 million passengers during the quarter, down 5.4 per cent year-on-year.

The governments of Norway, Sweden and Denmark own a 50-per-cent stake in SAS, while private shareholders hold the rest. (dpa)