Kuwait-based Jazeera Airways Group has reported a net profit of KD3 million ($9.9 million) in the first quarter, up 44.6 per cent from the same period last year.

The group also registered an operating revenue of KD12.9 million ($42.6 million), an increase of 3.5 per cent from Q1 last year while its operating profit stood at KD2.4 million ($7.9 million), up 141.2 per cent compared to the same quarter in 2014.

Marwan Boodai, Jazeera Airways Group chairman, said: “With a 44.6 per cent increase in net profit from Q1 2014, this quarter’s earnings clearly reinforce our decision to focus on the airline business. The opportunity for the airline continues to be at home despite the political challenges we see in the region. We operate in an area that has one of the fastest growing populations in the world and enjoys one of the highest disposable incomes in the world.”

Last month, the company’s board recommended record dividends and payments to shareholders totalling up to KD50 million ($165.2 million) in the form of special dividends for 2014 and a share buyback programme.

All payments will be executed separately over the next few months with the last payment expected to take place in August, pending regulatory and shareholder approvals, the company said in a statement.

On January 15, the company announced the sale of its leasing fleet of 15 Airbus A320s for $507 million. The sale was part of a strategic move to exit the aircraft leasing business and focus on the company’s star performer — the passenger airline Jazeera Airways, which generated 80 per cent of the company’s net profit historically.

The sale transaction is reflected in 2014 financial accounts and is expected to close by June 30. Discontinuing operations represents income from the leasing business, it said.

The company’s board-recommended shareholder payments in 2015 are as follows:

• Special Cash Dividends for 2014:  KD20 million ($66 million) to be paid following shareholder approval at the upcoming Annual General Meeting of Shareholders scheduled May 21.
• Share buyback program payments: Up to KD30 million ($99.1 million), which includes KD22 million ($72.6 million) for the purchase of 220 million shares out of the total 420 million outstanding issued shares at the nominal price of 100 fils (KD0.1) and up to KD8 million ($26.4 million) in 2015 earnings and other reserves that are required by law to be distributed prior to executing the planned share buyback programme.

Jazeera Airways Group’s share buyback programme will be the first voluntary share buyback programme exercise in Kuwait based on the new procedures stated by Kuwait’s new Commercial Companies Law (97/2013) and its executive regulations. The board has committed to executing the dividends and the pay-outs as soon as shareholder and regulatory approvals are secured, the company said. - TradeArabia News Service