Greece-based Aegean Airlines reported an after tax profit of €15.9 million ($21 million) for the half year ended June 30, down marginally from the €16.5 million reported for the same period the previous year.

However, net earnings for the period were up 131% from €6.9 million year-on-year when Olympic Air is included in the respective period.

First-half revenue increased 8% to €388.6 million, resulting in an operating profit of €41.4 million for the period, up 36% year-over-year.

Aegean attributes the group’s first-half improved results to its network expansion and cost synergies with Olympic Air, which it acquired in October last year.

Together, Aegean and Olympic Air carried 4.3 million passengers in H1 2014, up 16% on the previous year, with load factor improving 2.1 percentage points to 76.1%, despite the high number of new destinations launched during the period. However, yield fell 5%.

Traffic in the domestic network increased 19%, driven mainly by lower fares, which boosted demand for main markets as well as smaller island destinations. International traffic out of the eight aircraft bases rose 13%, with Athens registering 17% as the market recovered for the first time since 2008.

Aegean MD Dimitris Gerogiannis said: “Our expanded operations for 2014 with a fleet of 50 aircraft, 13 million available seats to be offered for the whole year, and 17 new international destinations, are yielding positive results. Olympic Air synergies are gradually maturing, bringing unit cost improvements and increased flows from connectivity. Our investment in incoming leisure and tourism over the last five years now brings tangible results for Aegean. This is so despite the significant rise in competitive capacity to our market as well as new source market related challenges faced in Russia and Ukraine. We are benefiting from scale economies and network development and we will continue to gradually but consistently pursue this strategy while making new investments in quality and competitiveness as most recently with our decision to take delivery of seven brand new Airbus A320 aircraft in 2015-2016.”

Aegean said its strategic priority for 2014 is to further expand its network, and the third-quarter outlook remains positive. Recent geopolitical developments in Ukraine, Russia and Israel are expected to have a negative effect on demand, but overall indications regarding inbound tourism arrivals are still positive.