Shenzhen Airlines reported CNY26 million ($3.8 million) in net earnings in 2008, its 15th consecutive full-year profit. It earned CNY640 million in 2007. The carrier credited "effective cost control" for the result, which contrasts with heavy losses reported by other Chinese carriers. Last year it reduced operating expenses by CNY714 million. Industry analysts suggested that a lack of fuel hedges contributed to its success. China Eastern Airlines and Air China suffered losses of CNY6.2 billion and CNY6.8 billion respectively resulting from Dec.
Lufthansa and Brussels Airlines announced reciprocal lounge access and baggage check-through. The carriers said a codeshare agreement covering "large parts" of their networks "is also envisaged," in addition to the pooling of LH, SN and Swiss International Air Lines loyalty programs ( ATWOnline, Jan. 27).
Alaska Airlines flew 1.35 billion RPMs in January, down 4.7% year-over-year. Capacity fell 8.4% to 1.88 billion ASMs and load factor rose 2.9 points to 71.7%. Republic Airways Holdings airlines flew 691.9 million RPMs in January, down 2.6% year-over-year, against a 1.7% climb in capacity to 1.1 billion ASMs. Load factor dropped 2.8 points to 62.8%. Allegiant Air flew 320.6 million system RPMs in January, up 5.4% year-over-year. Capacity fell 2.6% to 373.6 million ASMs and load factor rose 6.5 points to 85.8%.
Swissport joined Greece's Marfin Investment Group in submitting a binding bid for pieces of Olympic Airlines ( ATWOnline, Feb. 11). Development Minister Costis Hatzidakis said Marfin bid €45.7 million ($58.8 million) for OA's flying operation and €16.7 million for its maintenance unit while Swissport offered €44.8 million for OA's grand handling operation.
Stating that results for the fiscal third quarter ended Dec. 31 reflect "the increasing severity of the economic downturn," Air France KLM reported a €505 million ($649.4 million) net loss compared to a €139 million profit in the year-ago period. The substantial deficit was created in part by major nonoperating losses, including a €288 million writedown on the fair value of its fuel hedges and a €103 million loss on currency fluctuations.
Oxford Aviation Academy reached a five-year deal with Jet2.com covering full flight simulator provision and ab initio training. Agreement calls for OAA to relocate a 737 FFS to its Manchester Training Center at Woodford where operations are scheduled to begin in August. Jet2.com agreed to source future cadet pilots from Oxford's training program.
Air Canada reported a 2008 net loss of C$1.03 billion ($827.6 million), reversed from a profit of C$429 million in 2007, citing "unprecedented volatility on fuel prices, significant fluctuations in foreign exchange and a worsening global economy."
WestJet and Canadian tourism company Transat AT, which operates Air Transat, announced the May 10 termination of a transport agreement originally scheduled to expire next year. Deal allowed Transat Tours Canada to charter WestJet aircraft. The parties said they "may enter into an ad-hoc charter agreement" in the future. Transat will replace WestJet with CanJet Airlines, with which it signed a five-year deal to April 30, 2014, with two one-year options. CanJet operates 737-800s.
Vueling Airlines board approved the merger with Clickair Friday ( ATWOnline, Jan. 12). The latter will increase its share capital to 5 million shares and will exchange each one for three Vueling shares, according to a regulatory filing cited by Dow Jones. Vueling and Clickair will hold an equal number of shares in the new company that will keep the Vueling name. Clickair's board, controlled by Iberia, still must approve the deal.
Frontier Airlines Holdings reported a $1.1 million net profit in the December quarter, reversed from a $32.5 million deficit in the year-ago period. The company is operating under bankruptcy protection and released limited financial figures last week. Three-month operating profit was $5.6 million compared to a $25.6 million loss in the three months ended Dec. 31, 2007, its third fiscal quarter. It reported an $8.7 million mark-to-market loss on its fuel hedges and $2.7 million in reorganization gains. Mainline unit revenue rose 10.2%.
Civil Aviation Authority of Singapore will distribute S$200 million ($132.5 million) this year "to help airlines and airport partners tide over the current economic downturn," comprising S$50 million in rental rebates, a S$20 million fund for concessionaires at Changi and a S$130 million Air Hub Development Fund "extended to airlines and airport partners."
South African Airways appointed GM-Operations Chris Smyth acting CEO while CEO Khaya Ngqula is on leave ( ATWOnline, Feb. 13). Turkish Airlines named Finance Director Mustafa Aydin as B&H Airlines CFO and Sarajevo Manager Okan Uluocak as B&H executive VP ( ATWOnline, Jan. 15).
Delta Air Lines is forming a subsidiary called Regional Handling Services that will combine the 4,000-plus customer service workers at regional subsidiaries Comair, Mesaba Airlines and Compass Airlines into one company based in Minneapolis. The unit will be operational later this year and is aimed at ensuring "a consistent airport experience for customers around the country" flying on Delta mainline and regional flights, DL said. RHS will oversee ticket counters, gates and baggage handling for the three regionals.
Lufthansa named Head of Product Management for domestic and European traffic Heike Birlenbach to run its new Lufthansa Italia subsidiary at Milan Malpensa. She has been at LH since 1990. Norwegian appointed Anne-Sissel Skanvik as senior VP-corporate communications.
Philippine Airlines expects to be "profitable or break even" in its fourth fiscal quarter ending March 31 but will remain in the red for the full year, President Jaime Bautista said in comments cited by Reuters. It lost $113.8 million through the six months ended Sept. 30 and posted a $30.6 million profit in the 2008 fiscal year ( ATWOnline, July 31, 2008).
Ryanair continued its campaign against uncooperative authorities yesterday, announcing a summer capacity cut at Dublin that the LCC is blaming on "high and rising charges" at the airport and the Irish government's €10 ($12.91) "tourist tax" scheduled to be imposed from March 30. Last week, Ryanair said it would reduce the number of based aircraft and routes at Shannon owing to the tax, which it said will "decimate traffic and tourism" ( ATWOnline, Feb. 6).
Virgin Atlantic Airways confirmed that it has commenced consultation with staff and union representatives about the possibility of cutting 600 jobs from its workforce numbering approximately 8,500, saying it is seeking to avoid layoffs but cannot rule them out.
South African Airways CEO Khaya Ngqula was placed on leave this week after the carrier's board commissioned an independent investigation of alleged improprieties, particularly concerning a catering contract that was awarded to a consortium co-owned by a business associate of the CEO's wife. Servair, a consortium co-owned by Vusi Sithole, recently was chosen in what SAA characterized as "a competitive bidding process" to cater inflight meals on domestic flights. According to multiple South African news reports, Sithole has close ties to Ngqula and his wife, Mbali Gasi.
Cathay Pacific Airways and Dragonair flew 7.89 billion RPKs in January, up 1.2% from the year-ago month. Capacity rose 4.7% to 9.91 billion ASKs, dropping load factor 2.8 points to 79.5%. LAN Airlines flew 2.67 billion system RPKs in January, up 10.8% year-over-year. Capacity climbed 14.2% to 3.43 billion ASKs, dropping load factor 2.3 points to 77.9%. SkyEurope Airlines transported 173,692 passengers in January, down 23.5% year-over-year. Load factor rose 4.1 points to 62.5%.
WestJet reported 2008 net income of C$178.1 million ($145.2 million), down 7.6% from C$192.8 million in 2007, hailing the performance in a "roller coaster year" in which nearly all North American airlines posted losses.
Malev Hungarian Airlines CEO Peter Leonov resigned, the carrier confirmed following Tuesday's extraordinary general meeting. COO Geza Fehervary will serve as temporary CEO while the company looks for a replacement, and Vneshekonombank Deputy Chairman Ballo Anatoly Borisovich was elected chairman. Malev shareholders also moved to reduce equity capital to HUF360 million ($1.6 million) because the carrier's new ownership structure is not finalized.
AAR Corp. was forced to shut down operations at its Miami landing gear repair station after FAA issued an Emergency Order of Suspension to the company's Landing Gear Services subsidiary, which generates about 6% of the MRO provider's revenue. AAR said it has been "in regular communication" with FAA since July 2008, when the regulator issued a "notice of alleged discrepancies" following an inspection of the Miami facilities. "The company was in the process of responding to that request when it received the order of suspension," AAR said.
Lufthansa Passenger Airlines flew 8.92 billion RPKs in January, a 6.2% drop from the year-ago month. Capacity fell 3.1% to 11.95 billion ASKs and load factor slipped 2.4 points to 74.6%. Swiss International Air Lines flew 2.14 billion RPKs in January, up 4.3% year-over-year. Capacity climbed 6.3% to 2.96 billion ASKs and load factor fell 1.4 points to 72.9%.
Jazz Air, Air Canada's regional partner, reported a net profit of C$134.8 million ($109.9 million) in 2008, down 10.5% from the C$150.7 million earned in 2007, on a 9.4% rise in revenue to C$1.64 billion. Operating expenses were up 10.9% to C$1.49 billion and operating profit fell 3.2% to C$148.3 million. The airline said it earned 71% of the performance incentives available under its capacity purchase agreement with AC, totaling C$15.7 million. Fourth-quarter profit of $34.9 million was 0.5% lower than the year-ago period's while operating income climbed 10.3% to C$39.7 million.
US Airways told employees it will lay off 233 ramp workers and gate/ticket agents in 10 cities owing to capacity cuts and the loss of contracts to provide ground services to other airlines at affected airports. Las Vegas, Pittsburgh and Tucson will see the biggest reductions. "These are uncertain times marked by less business flying, fewer family vacations and rising unemployment," US Chairman and CEO Doug Parker wrote in a note to employees cited by the Associated Press.
