Fraport announced the sale of its 65% stake in Frankfurt-Hahn to the State of Rhineland-Palatinate for €1 ($1.28). The state now holds 82.5% of HHN, with eastern neighbor Hesse holding the remainder. Fraport said its divestment largely was related to Ryanair's threat to reduce its operation at HHN if the operator successfully imposed a per-passenger "airport development fee." It said the fee "was an essential prerequisite. . .to make Hahn profitable."
UPS reported full-year 2008 net income of $3 billion, widened significantly from a $447 million profit in 2007 when its results were skewed by a one-time $6.1 billion pension payment, but nevertheless said it must make "tough decisions" to cope with a "severe decline in economic activity around the world." In what is perhaps a more telling comparison, 2008 income was down 28.6% compared to $4.2 billion in 2006. To counter the difficult financial environment, the delivery giant announced yesterday that it has "consolidated operating districts, reduced air segments and eliminated some
Oneworld Governing Board Chairman and American Airlines Chairman and CEO Gerard Arpey dismissed suggestions that the alliance might fall apart if the application for antitrust immunity for AA, British Airways, Finnair, Iberia and Royal Jordanian or the proposed merger between BA and IB fails. "We are not contemplating anything else than getting immunity, which will enable us to compete on more equal terms with the other alliances," Arpey told ATWOnline at the group's 10th anniversary event in Madrid.
Finnair CEO Jukka Hienonen told ATWOnline at this week's oneworld meeting in Madrid that the airline does not have the flexibility to remain stable during the current market downturn. Finnair was €2.1 million ($2.7 million) in the black through the first nine months of 2008, but it does not expect a positive full-year result.
A stunning SEK6.32 billion ($754.7 million) full-year loss, reversed from a SEK636 million profit in 2007, prompted yesterday's unveiling of a new restructuring initiative dubbed Core SAS that will include a SEK6 billion rights issue and approximately 3,000 layoffs.
Korean Air reported a full-year 2008 net loss of KRW1.96 trillion ($1.4 billion), reversed from a net profit of KRW11.1 billion in 2007, citing the weak won as the biggest contributor to the heavy deficit.
Continental Airlines said January consolidated RASM fell 5%-6% year-over-year. Traffic dropped 11% to 6.43 billion RPMs against a 6.5% decline in capacity to 8.79 billion ASMs. Load factor was down 3.6 points to 73.2%.
The market conditions that forced European heavyweights Air France KLM and British Airways to warn of steep operating losses appear to have bypassed Germany, where Lufthansa yesterday raised its full-year operating profit projection to €1.3 billion ($1.66 billion) from the previous €1.1 billion.
Iberia shareholder Caja Madrid Chairman Miguel Blesa told reporters that a merger agreement with British Airways is "close," Reuters reported from Madrid. The bank is IB's largest shareholder at 23%. "The perception now I think is that the share exchange will not be 60-40," he said. "Iberia is now worth more. It will be closer to 55-45." IB's increased valuation has been a source of concern at BA ( ATWOnline, Feb. 2).
Ryanair reported a €118.8 million ($152.1 million) net loss for the fiscal third quarter ended Dec. 31, a sharp reversal from the €47.2 million earned in the year-ago period, owing primarily to a 71% increase in fuel costs and a 9% decline in average fare.
Aeroflot said "preliminary analysis" of its 2008 financial performance indicated a 26.2% year-over-year growth in revenue based on Russian accounting standards. "This gives ground for us to expect a positive financial result for 2008, close to the 2007 level," SU said. It reported a $313.4 million profit under IFRS in 2007. It transported 9.3 million passengers in 2008, up approximately 13.4%, but load factor fell 0.3 point to 70.9%. Separately, the airline launched twice-weekly Moscow Sheremetyevo-Eilat Ovda flights aboard an A320.
Kenya Airways expects to report a profit for its fiscal year ending March 31 but warned yesterday that the figure will be as much as 25% lower than the KES5.5 billion ($67.8 million) earned in 2007-8. "The benefits that accrue from the decline in jet fuel prices are being offset by the hedge costs, thus impacting on the profitability," Chairman Evanson Mwaniki said in a statement. The Kenyan shilling also has declined against the US dollar. KQ reported a KES736 million profit in the six months ended Sept.
Pratt & Whitney reached a four-year deal with Evergreen International Airlines to provide line maintenance services for PW4000, JT9D and CF6 engines. Agreement includes engine changes and is renewable up to 20 additional years.
Airbus signed a cooperation agreement with Xian Aircraft Industry Co. stipulating that wings for A320 family aircraft assembled at the Tianjin FAL will be fully completed and tested in Tianjin. XAC will build an equipping and testing facility near the FAL, with operations expected to start by year end. First delivery of fully equipped wings is scheduled for the 2010 first quarter. Production rates by the end of 2010 are projected at two units per month and by the close of the following year at four units per month.
Having lost a bid to receive confidential treatment for financial and traffic information that it is required to file with the US Dept. of Transportation as a certificated carrier, Virgin America yesterday said it suffered a $175.4 million loss in the first three quarters of 2008.
Shanghai-based Spring Airlines and Juneyao Airlines stood out among China's struggling privately held airlines and reported a profitable 2008. Spring posted a CNY21 million ($3.1 million) net profit last year, down 70% from the more than CNY70 million earned in 2007. It credited the result partly to a CNY20 million civil aviation infrastructure payment imposed in the second half of last year. Its operating revenue climbed 32% year-over-year to CNY1.62 billion as it transported 2.9 million passengers, up 26%, with an average load factor of 93.3%.
Air Canada and Jazz Air said yesterday that they reached agreement on "new rates for controllable costs" to be paid by AC to Jazz as part of the capacity purchase accord under which the regional operates flights on behalf of the flag carrier. The rates, which were not disclosed, are retroactive to Jan. 1 and will extend to the end of 2011. Additionally, AC announced that it concluded a secured financing transaction valued at $37 million with Norddeutsche Landesbank Girozentrale that increases a previously announced facility for $78 million with Calyon New York Branch and NLG.
Austrian Airlines Group is facing massive challenges to liquidity, with COO Mepeter Malanik saying Friday, "Demand is collapsing and the outlook offers very little reason to be optimistic." He added, "We expect to see a reduction in revenue of up to 15% at the Austrian Airlines Group in 2009, equivalent to approximately €225 million ($294.4 million)." The announcement came a day after the dismissal/resignation of CEO Alfred Oetsch ( ATWOnline, Jan. 27)
Southwest Airlines announced a tentative five-year deal with the Southwest Airlines Pilot Assn. that will run through Aug. 31, 2011, if approved by the union's board and membership. SWA has been negotiating with the pilots since September 2006. According to a statement from the airline, the agreement "delivers raises and increased benefits" to its pilots. It is subject to approval by the SWAPA board after which it will be submitted to union membership for ratification. WN also announced that 2,500 mechanics represented by the Aircraft Mechanics Fraternal Assn.
Boeing resumed production on the fifth 787 flight test aircraft, ZA005, joining the fuselage and wings on Jan. 29 ( ATWOnline, Jan. 28). It is the first GEnx-powered 787. VP-787 Final Assembly and Change Incorporation Jack Jones said the join marked the company's "return to a steady production rhythm." Five of the six flight test aircraft now are in production, with first flight scheduled for the second quarter. Assemblies for 30 787s, including the sixth test aircraft, currently are in production.
EASA awarded type certification to the Tu-204-120CE, a dedicated cargo version of the aircraft powered by two RB211-535E4s. It also offers an "English-language cockpit" with operations documentation in English. The certificate is valid in the EU, Switzerland, Norway, Iceland and Liechtenstein, where the aircraft now can be registered and operated legally. It is the first EASA approval for a transport aircraft designed by an organization from Russia/CIS. EASA Executive Director Patrick Goudou said he was "confident it will serve as a model for future projects."
BAE Systems Regional Aircraft said its lease portfolio and support business remained strong in 2008 despite the increasingly difficult economic climate. "The Regional Aircraft team has performed well, winning significant new business across all sectors despite a worsening trading environment," MD Alan Fraser said. Last year 75 aircraft were placed through new leases, extensions and sales. There were 41 separate BAe 146/Avro RJ transactions in 2008. BAE ended production of its line of regional jets in November 2001 but has remarketed aircraft and support services actively since then.
A ¥12.6 billion ($140 million) loss in its third fiscal quarter ended Dec. 31, reversed from a ¥12.4 billion profit in the year-ago period, combined with "the likelihood of the situation worsening in the foreseeable future," led ANA to predict its first full-year deficit since 2002-03.
SAS Group announced the completion of its sale of a majority share in Spanair and its entire stake in airBaltic. A consortium of Spanish investors led by Consorci de Turisme de Barcelona and Catalana d'Inciatives acquired an 80.1% stake in Spanair for €1 ($1.31), leaving SAS with the remainder ( ATWOnline, Dec. 19, 2008). SAS took a SEK712 million ($87.9 million) loss on the deal that will reflect on its fourth-quarter balance sheet.
