Etihad equity partner returns to profit
Abu Dhabi, March 18, 2013
UAE national airline Etihad said its equity partner Air Seychelles, the flag carrier of Indian Ocean island country Seychelles, has posted its first net profit after three years of losses.
A net profit of $1 million was achieved just one year after Etihad acquired a 40 per cent stake in Air Seychelles along with a five-year management contract to provide strategic support and management expertise in reshaping the airline as a sustainable commercial entity.
The result marks a dramatic change of fortune for the Indian Ocean carrier which had made heavy losses for past three years.
James Hogan, Etihad Airways’ president and CEO said, "The challenges in the global economy mean it is still a very tough environment for airlines. Against thats backdrop, this is an impressive result."
"This performance validates the strength of our equity alliance proposition in which closer committed commercial collaboration drives revenue growth, and the integration and consolidation of key functions, achieves economies of scale and cost savings," he noted.
“It is also testament to the hard work and willingness of the Air Seychelles team to embrace change and make the tough decisions required in reshaping their business," he added.
Network and fleet planning centralized in Abu Dhabi has resulted in a new network plan which will support the hugely important tourist sector in Seychelles more effectively with good connections and broader choice for visitors to the archipelago.
The optimised schedule has enhanced connectivity with Etihad Airways and other partner airlines over Abu Dhabi. Nineteen new codeshare destinations with Etihad Airways will open up key European markets.
Leveraging synergies and economies of scale arising from its relationship with Etihad Airways, Air Seychelles has been able to achieve substantial savings and cost reductions in aviation insurance, international catering and ground handling and inflight entertainment.
The conclusion of joint contracts for fuel, uniforms and stationery supplies, all contributed to significantly reduced costs. The airline negotiated the return of two Boeing 767s to a finance company, which resulted in considerable savings.
A major benefit of the equity partnership has been the broad access for Air Seychelles to Etihad’s hitech taining academy in Abu Dhabi, and Etihad’s Emiratisation initiatives including the technical training program, the cadet pilot program, and the graduate manager development program.
An extensive training program for cabin crew and pilots has also taken place, with 136 cabin crew members spending two months at Etihad’s Training Academy in Abu Dhabi, along with 29 pilots, who were retrained on the A330-200 full flight simulators in preparation for the airline’s new Airbus A330 aircraft.
In another key collaboration, Seychelles Plus, the Air Seychelles frequent flyer program, became fully integrated into the Etihad Guest loyalty platform in June 2012 bringing access to Etihad Airways’ award-winning reward shop and services.
The Indian Ocean carrier had last year flown 144,450 passengers on its domestic network and 103,300 passengers on its international network. This included a record number of passengers carried on its flights to South Africa.-TradeArabia News Service