Jazeera Airways net profit up 32pc
Kuwait, March 26, 2013
Kuwait-based budget carrier Jazeera Airways has recorded a 32 per cent growth in its net profit which soared to KD13.9 million ($48.7 million) from KD10.6 million the previous year, driven by yield enhancement, robust cost management, strong network and continued focus on customers.
Announcing the results, Group chairman Marwan Boodai said, “Like 2011, last year too was another record-breaking year in every sense. This performance continued to be driven directly by a healthy, growing, profitable and sustainable airline business, and a reliable and consistent leasing business."
"Together, they have proven to be an ideal business combination that generates a sustainable net profit in every quarter," he stated.
"Jazeera has closed 2012 with a record net profit of KD13.9 million beating 2011's record earnings by 32 per cent and making 2012 the company’s best year in history despite regional political unrest and fuel price volatility," he added.
According to him, the company is well-positioned for growth in 2013, to receive two new additional aircraft during the year.
The airline's operating revenue grew 8 per cent to KD62.6 million from KD57.8 million the previous year, while its operating profit surged 25 per cent to KD18.5 million from KD14.9 million a year ago.
The Kuwaiti budget carrier witnessed several key developments in 2012 including the introduction of new sales, booking, and check-in technologies and the receipt of a new aircraft, financed by European Export Credit Agency.
The airline also launched its first commercial service from Kuwait to Iraq in 22 years, endorsed by the governments of both countries, said Boodai.
"The product and customer experience enhancements have also been a driver in the airline’s returns. The airline introduced new payment and check-in technologies, including mobile apps and self-check-in facilities at Kuwait Airport, the first in Kuwait, and web-check-in throughout the network," he stated.
"By the end of the 2012, one in ten bookings was made on a mobile platform," noted Boodai.
"Operationally, the airline also had one of its best years to date. FlightStats, the US-based center that monitors flights’ on-time performance (OTP) globally, had ranked Jazeera Airways as the world leader in on-time performance in 2012. This is a major achievement for Jazeera Airways and a boost to its internal OTP and operational excellence culture," said the proud airline chief.
According to him, the group's hard assets stood at KD149 million. Jazeera closed the year with an improved and healthy balance sheet that is cash-rich with KD47 million.
“This strong performance clearly demonstrates the agility and viability of the Jazeera Airways Group’s business model, which continues to perform even in the wake of high fuel costs and political turmoil in our region,” said Boodai at the shareholders' meeting.
"I thank our shareholders and their statement of confidence in the Group that evident in the 2.25 times oversubscription of the rights issue that was executed and concluded in the fourth quarter," he added.
As for the Group’s leasing operation, Sahaab Aircraft Leasing is scheduled to receive two new Airbus A320 aircraft in 2013.
"Both are planned to be inducted into the airline operation, replacing two older aircraft. Sahaab Aircraft Leasing will then undertake to remarket those two older aircraft to regional or international customers," said Boodai.
The funds raised through the rights issue will help finance these deliveries and other strategic initiatives and growth plans, in addition to closing high-interest commitments.
“Our continued success in 2012 couldn’t have been achieved without the co-operation of the Kuwait Directorate of Civil Aviation and their support across all levels, our partners and service providers, and the support of the government of Kuwait.”
On the 2013 outlook, the group chairman said, "Following the last two record-breaking years, it is well-positioned for another growth year in line with the strategic master plan set by the management team."
"For the airline, we operate a regional network where the average flight time is 2 hours and 25 minutes. This market is always in demand and has repeatedly shown it can withstand political, weather, and financial shocks," explained Boodai.
"Since 2008 we’ve seen financial crises, revolutions, wars, severe weather disruptions and irregular regulatory environments, and despite it all, demand for our product never waned and we continued to generate record earnings while serving our customers with a great product," he added.
The results reflect the ongoing success of the Jazeera Group’s strategic master plan (STAMP), the airlines' business strategy for 2012 to 2014.
“I am very optimistic that we will continue to witness growth and perform towards meeting and hopefully exceeding our business plan targets to the satisfaction of our stakeholders and business partners," said Boodai.
“Today, with the right funding in place, both the airline and leasing business lines have been successfully complementing each other for three years now. I can truly say that we have the ideal business structure as proven by the impressive results. Simply said; A bright future is awaiting us,” Boodai told the shareholders.
Jazeera Airways is an IATA-member airline and operates one of the youngest Airbus A320 fleets in the Middle East.-TradeArabia News Service