Thai Airways reported a THB21.38 billion ($592.1 million) loss in 2008 compared to a THB4.43 billion profit in 2007 as the economic downturn and the protest-induced closure of Bangkok Suvarnabhumi in the fourth quarter proved too much to overcome. Thai suffered a THB14.8 billion fourth-quarter loss that represented a reversal from a THB1.84 billion profit in the final three months of 2007 ( ATWOnline, Dec. 5, 2008).
While noting that last year was "one of the most difficult in recent memory," Iberia Group still managed to achieve its 13th consecutive full-year profit with net earnings of €32 million ($40.8 million), down 90.2% from the €328 million reported in 2007.
Aeroflot transported 635,900 passengers in January, up 0.3% from the year-ago month. Traffic climbed 2.6% to 1.97 billion RPKs and load factor slipped 1.4 points to 62.5%.
China Eastern Airlines is looking to drive load factors by making it easier and more economical for potential passengers to connect. CEA said its point-to-point network has made it difficult to attract more passengers in a declining market, so it has identified some 900 "transit routes" featuring multiple segments between markets that may have growth potential.
Virgin America's poor financial showing has led to speculation that the San Francisco-based startup may be in jeopardy of losing the support of its US-based investors. Founded by impresario Richard Branson and designed to capitalize on the success of the Virgin brand, the airline is majority owned and operated by US investment groups Black Canyon Capital of Los Angeles and Cyrus Capital Partners of New York. Branson maintains a 25% share ( ATW, August 2008).
After wrangling with the U.S. Department of Transportation, the carrier last week reinstated a "Passenger Usage Fee" of $4.90 each way. Spirit began charging the fee last summer, along with a $2.50 "natural occurrence interruption fee" and an $8.50 "international service recovery fee." A natural occurrence is more commonly known as "weather." The recovery fee aimed to offset the costs of doing business with international destinations.
Air Algerie/UK named Zoheir Houaoui GM-UK and A. Benabderrahmane station mgr. Airclaims welcomed Paul Jenkins as technical services engineer, Simon Martin as surveyor/project mgr., Ian Cox as powerplant mgr. and James Rust as technician. Airports Council International-North America tapped Jane Calderwood as VP-government & political affairs. Air Southwest appointed Peter Davies MD. ALTA selected Hector A. Chichoni as national immigration counsel. Amsafe chose Terence W. Lyons as president & CEO. ANA elevated Shinichiro Ito to president & CEO.
American Airlines joined the Climate Leaders program of the US Environmental Protection Agency, becoming the first major passenger carrier to enter the program.
The good times didn't last long. Following the comeback of 2007--a year in which the US's 10 largest airlines all were in the black after years of bankruptcies and red ink--2008 proved to be among the most humbling ever for the world's largest air transport market. Carriers were hit hard by soaring fuel costs in the first half, and then hit hard again when oil prices plummeted in the second half of the year to well below airlines' hedging positions. Heavy noncash goodwill impairment charges also weighed down bottom lines.
Air New Zealand said its foreign exchange hedging program limited the effects of fluctuating fuel prices and the economic downturn as it remained profitable in the fiscal first half ended Dec. 31, reporting a NZ$24 million ($12.3 million) net that was 79% lower than the year-ago result.
Malaysia Airlines reported a MYR245.7 million ($67 million) profit in 2008, a 69.7% decrease from the MYR852.7 million earned in 2007 but a result that MD Idris Jala called "solid" and evidence "that if we set our minds to do the impossible, we can do it."
Shanghai Airlines is expected to receive a CNY1 billion ($146 million) capital injection through the issuance of a nonpublic stock offering to Jinjiang International Holding, its third-largest stakeholder. The move is designed to reduce SAL's debt ratio and relieve some pressure as its financial situation worsens ( ATWOnline, Feb. 6). The carrier said its debt ratio will fall 5.9 points to 85.5% as a result. Last month it warned that its 2008 loss may be double the CNY435 million reported in 2007.
Alaska Airlines yesterday launched a 60-day customer trial of inflight Wi-Fi service in conjunction with Row 44, allowing passengers aboard a 737-700 to use wireless Internet service on their own laptops or other devices. Service initially will be free. "After a successful trial period, the airline will determine the schedule for rolling out the commercial availability of its wireless Internet service to its entire fleet of aircraft," it said.
Korean Air board has decided to order an additional six A330s. Two aircraft will be delivered next year, followed by two in 2011 and two in 2013. KE currently operates three A330-200s and 16 A330-300s.
Estonian Air will conduct a €7.3 million ($9.4 million) rights issue, according to SAS Group, which holds a 49% stake in the company. SAS said it will participate through the conversion of €2.4 million of outstanding loans to Estonian into equity and an additional €1.2 million cash payment. The Estonian government (34%) and AS Cresco (17%) also will subscribe to their respective proportion of shares. SAS said it still plans to divest its interest in Estonian ( ATWOnline, Feb. 4).
Turkish Airlines defended the maintenance record of the 737-800 that crashed on approach to Amsterdam Schiphol on Feb. 25, while Dutch investigators focused on whether the aircraft's sudden drop into a field suggested possible engine trouble. THY said in a statement that the aircraft underwent a C check on Oct. 22, an A check on Feb. 19 and was taken out of service briefly on Feb. 23 when "the pilot reported a malfunction of the Master Caution Light. . .and the part was replaced."
Ryanair said Ireland's minister of finance repealed the €10 "tourist tax" at "small and peripheral airports" like Donegal and Sligo but left it in place at Dublin and Shannon. The LCC this month announced cuts in its service at both airports ( ATWOnline, Feb. 13).
Frontier Airlines Holdings, which is operating under bankruptcy protection, said it posted a $27.9 million net loss in January and a $2.8 million operating profit. Net result would have been a $2.8 million loss excluding reorganization items and mark-to-market fuel hedge transactions. January reorganization costs reached $28.3 million. Mainline unit revenue rose 4.4% year-over-year while unit cost fell 20.1%. President and CEO Sean Menke said the company is "now focused on securing the necessary financing to facilitate our emergence from bankruptcy later this year."
A INR187 million charge "to settle a long pending dispute with an erstwhile investor" dragged India's SpiceJet to a INR180 million ($3.6 million) loss in the third fiscal quarter ended Dec. 31 (year-ago result not provided), but the carrier remains focused on an international future. Excluding the charge, the New Delhi-based LCC posted an INR8 million profit. Operating revenue rose 16% year-over-year to INR4.72 billion on a 24% increase in average fare. Unit revenue climbed 11% to INR2.42 and passenger numbers were down 12%.
Vueling Airlines, which will join with Barcelona rival Clickair to create a "new" Vueling, reported an €8.5 million ($10.8 million) net profit last year, a welcome reversal from the €78.5 million lost in 2007, as it implemented a restructuring plan. Full-year revenue increased 21% year-over-year to €438.9 million as costs rose 8.1% to €469.7 million. Operating loss narrowed 57% from €71.7 million to €30.8 million in 2007.
United Airlines parent UAL Corp. named General Motors VP-Global Strategy and Operations Tony Cervone as senior VP-corporate communications and chief communications officer.
Air New Zealand is concerned that France's Bureau d'Enquetes et d'Analyses released its 53-page interim report on the November A320 crash to the media before it was provided to the airline, in addition to the fact that ANZ has not been given access to either the CVR or the FDR. BEA said the A320's pilots, who worked for XL Airways, were conducting a low-speed test on approach to Perpignan when they lost control and crashed into the Mediterranean Sea, killing seven ( ATWOnline, Feb. 25).
South Africa's Comair, which operates as a British Airways franchisee and as LCC kulula.com, reported a ZAR31.8 million ($3.2 million) profit in the fiscal half-year ended Dec. 31, down 46.6% from the ZAR59.5 million earned in the year-ago semester. The company said high oil prices in the fiscal first quarter were the main driver of the profit decrease. It currently operates 10 737-400s, nine 737-300s and six 737-200s across its two brands.
Cyprus Airways released a statement saying that its 2008 financial results "are expected to be improved compared to the comparatives for 2007," in which it posted a €1.2 million ($1.5 million) profit that was its first in several years. The board is scheduled to meet Feb. 27 to approve the 2008 accounts. Through the first six months of last year the airline was €7.2 million in the red compared to an €11.6 million deficit through the first half of 2007. Its six-month operating loss was €7.8 million, narrowed from €9.8 million the prior year.
AirTran Airways launched a buy-on-board food service called Sky Bites on 60 flights, with plans to expand it to the entire network starting next month. Individual items will cost $1-$4 and packages will be $4-$6. It is partnering with Kraft Foodservice on the program. Separately, it launched a daily Atlanta-Cancun service yesterday.
