SAS Group reported a SEK411 million second-quarter loss, reversed from a SEK607 million profit in the year-ago period, and announced enhancements to its Profit 2008 recovery program featuring an additional SEK400 million in savings and the grounding of seven more aircraft. "The reasons for the decrease in earnings are well known," President and CEO Mats Jansson said. "Managing this highly challenging situation is currently the primary focus of the SAS Group and the entire air travel industry."
Fly540 F-27 crashed on its way to Mogadishu from Nairobi, killing all three occupants--both pilots and an engineer. Flight Safety Foundation's Aviation Safety Network said the 26-year-old aircraft was operating a cargo flight and crashed on approach. Xinhua news agency reported that it hit a telecommunications tower. The Kenyan carrier announced an ATR order last winter as it looks to expand its passenger operation ( ATWOnline, Feb. 7).
Turkish Airlines CEO Temel Kotil told Turkish TV network CNBC-e that THY is "interested in principle in the stake sale of Austrian Airlines" but that it has "not taken a decision on this," Reuters reported ( ATWOnline, Aug. 14). He also said it is interested in the 49% stake currently being offered in Bosnia's B&H Airlines.
El Al recorded a second-quarter net loss of $11.2 million, reversed from a $16.6 million profit in the year-ago period, as rising fuel costs mitigated record revenue. "During the second quarter, El Al faced the challenge of the international crisis in aviation," President Haim Romano said. "Fuel prices continued to soar, by about 80% [year-over-year] . . . During the quarter, the fuel component represented close to 40% of flight expenses and resulted in a significant growth in company expenditure." He added that the Israeli flag carrier faces "ever increasing completion. . .
Korean Air reported a second-quarter loss of KRW288.9 billion ($278 million), widened from a KRW214.4 loss in the year-ago quarter, as costs escalated faster than rising revenue. "Fuel expenses showed a sharp increase of 80.4% triggered by a soaring fuel price and a weakening Korean won," KE said, adding that a "weaker economic backdrop" slowed traffic growth, particularly in the international passenger sector.
American Airlines firmed up commitments for 26 new 737-800s comprising 20 converted options and six new orders, Boeing announced yesterday. The six new aircraft will be part of the accelerated fleet plan and MD-80 replacement program announced earlier this week ( ATWOnline, Aug. 14). AA now has ordered 36 -800s this year and is "accelerating deliveries of airplanes booked in prior years," according to the manufacturer.
Deutsche Post World Net CEO Frank Appel defended subsidiary DHL's proposed plan to shift its US air lift from ABX Air and Astar Air Cargo to rival UPS, saying criticism from US politicians over potential job losses at DHL's US air hub in Wilmington, Ohio ( ATWOnline, Aug. 14), misses the bigger picture and that there are no grounds for an antitrust review.
Oneworld partners American Airlines, British Airways, Iberia, Finnair and Royal Jordanian yesterday confirmed that they filed for worldwide antitrust immunity from the US Dept. of Transportation and notified the appropriate regulatory authorities in the EU.
US Airways announced that Merrill Lynch will purchase 19 million shares of US common stock in an underwritten public offering at $8.50 per share. Net proceeds after the underwriting discount and estimated offering expenses will be approximately $155 million to be used for "general corporate purposes," US said. ML will have a 30-day option to purchase an additional 2.85 million shares to cover overallotments. The offer is expected to close Aug. 19. Trading in US shares was halted yesterday.
Copa Airlines and Aero Republica parent Copa Holdings reported second-quarter net income of $30.4 million, down 1.5% from $30.9 million in the year-ago period, as its aggressive expansion continued to pay off even in the face of high fuel costs. Copa said the "strong results" were reflective of fast-growing revenue that allowed it to maintain "its position among the world's most profitable airlines" even as fuel costs rose by $37 million year-over-year. Operating revenue soared 26.6% to $297.9 million and operating income was $31.2 million, down 20% from $39 million last year.
UK NATS reported that the number of flights through UK airspace in July dipped 0.6% from the year-ago month, the first decrease since 9/11. All NATS centers showed negative or static results. The London Area Control Centre handled 0.1% fewer flights and its Manchester counterpart 5.9% fewer. Transatlantic departures and arrivals decreased 3.3% and transatlantic overflights grew 2.3%.
Ryanair, which said last month that it expected an annual result of between breakeven and a €60 million loss for the year ending March 31, 2009, now expects to do no worse than breakeven. CEO Michael O'Leary told the BBC yesterday that the LCC "will be one of the very few airlines in Europe to grow strongly this winter and at least to break even, if not to make a small profit." Ryanair lost €90.5 million ($134.8 million) in its fiscal first quarter ended June 30.
SITA will upgrade Cathay Pacific Airways' network infrastructure to ensure readiness for new applications under a four-year, multimillion-dollar deal announced yesterday. Upgrade will offer 425% more bandwidth and feature messaging, IP services, managed firewall and end-to-end service management with a 24/7 help desk and on-site team. Agreement also includes SITA's Airport Hub solution featuring shared IT systems at more than 100 airports.
Swiss International Air Lines and its Edelweiss Air subsidiary reached an agreement allowing LX customers to book seats on Edelweiss flights to 15 destinations from Oct. 26. Established in 1995, Edelweiss operates as an independent entity within the Swiss group with three A320s and one A330-200.
Spring Airlines is expecting 2008 earnings to fall short of the CNY70 million ($10.2 million) profit reported last year owing to the difficult operating environment. Speaking to China Business News, Spring Chairman Wang Zhenghua said the LCC posted "a little" profit in the first half. He said fuel costs have jumped to 50% of Spring's total expenses, up from 30%-40%. "In addition, labor costs are rising," he said.
Austrian Airlines Group majority shareholder OIAG launched the tender for its 42.75% stake in the flag carrier, informing potential bidders that they have until Aug. 24 to declare their interest, according to press reports ( ATWOnline, Aug. 13).
Porter Airlines, which launched Q400 service in October 2006 from Toronto City Centre Airport, is eyeing additional destinations in the US, the first of which likely will be announced in the fall. "Boston and Chicago [Midway] are on the top of the list but Washington [National] and Philadelphia are close behind," Porter President and CEO Robert Deluce told ATWOnline. "All of them are on our radar screen for the short term." The US destinations need to be within 500 nm. of Toronto and have enough O&D traffic to support the service, he added.
Brussels Airport traffic returned to normal yesterday after negotiators sealed a deal to end a strike by baggage handlers Flightcare and Aviapartner over pay and working conditions. The work stoppage, which started Sunday night, forced airlines to cancel, delay or divert flights in and out of BRU. Some 120,000 passengers were affected by the strike, the airport said, and the baggage backlog is estimated at 20,000 pieces.
Thai Airways posted a THB9.25 billion ($272.3 million) loss in the second quarter, widened from a THB430 million deficit in the year-ago period, on fuel costs and foreign exchange losses, according to a company statement cited by Reuters.
American Airlines flew 12.46 billion system RPMs in July, a 3.5% decrease from the year-ago month. Capacity fell 1.2% to 14.52 billion ASMs and load factor declined 2 points to 85.8%. Northwest Airlines flew 7.56 billion consolidated RPMs in July, up 3.9% year-over-year. Capacity increased 5.2% to 8.73 billion ASMs and load factor fell 1.1 points to 86.6%. British Airways flew 9.98 billion RPKs in July, down 3.5% from the year-ago month, against a 3.5% increase in ASKs to 13.17 billion. Load factor dropped 5.4 points to 75.8%.
American Airlines said yesterday that it will speed up deliveries of its 737-800s, taking an additional six in 2010 as it as it seeks to replace its MD-80s with more fuel efficient aircraft. The carrier now plans to take delivery of 36 -800s in 2009 and 40 in 2010. It has firm orders for an additional 11 737NGs to be delivered in 2013 and "continues to evaluate opportunities to accelerate MD-80 replacement with additional 737s," it said in a statement.
Pinnacle Airlines Corp. reported a second-quarter net loss of $11.4 million, a reversal from the $7.6 million profit reported in the year-ago quarter, on a 10% lift in operating revenue to $221.2 million.
Austrian government's Council of Ministers yesterday issued the contract for the privatization of Austrian Airlines Group to state holding company OIAG, entitling it to sell the entirety of its 42.75% stake ( ATWOnline, Aug. 11). The contract stipulates that Austrian interests must hold 25% plus one share. Merrill Lynch has been appointed as exclusive financial adviser in the potential sale of OIAG shares to a strategic partner ( ATWOnline, Aug. 1).
Air India parent National Aviation Co. of India signed a $214.1 million pre-delivery finance loan agreement for five 777-300ERs and three 777-200LRs scheduled for delivery in 2009-10. Bank of Scotland and Deutsche Bank are lead arrangers and ING Bank and Natixis Transport Finance are co-arrangers.
Ukraine International Airlines carried 936,500 passengers through July, an increase of 23% over the first seven months of 2007. Iberia flew 4.91 billion RPKs in July, down 1.4% year-over-year, against a 0.6% lift in capacity to 5.81 billion ASKs. Load factor fell 1.7 points to 84.6%. Aer Lingus flew 1.72 billion RPKs in July, up 8.1% from the year-ago month. Capacity rose 8.9% to 2.06 billion ASKs and load factor fell 0.7 point to 83.3%.
