Singapore Airlines Group reported a net profit attributable to shareholders of S$235 million ($141.8 million) for the fiscal first quarter ended June 30, down 7.9% compared to a net profit of S$255 million in the prior-year period. Total revenue rose 11.7% to S$3.04 billion but total expenses climbed 15.3% to S$2.79 billion as higher fuel prices added S$363 million (before hedging) to expenditure. As a result, operating profit dropped 16.5% to S$253.1 million from S$303.1 million. SIA carried 4 million passengers in the quarter, up 5.7% over last year.
CSA Czech Airlines Supervisory Board approved the decision of the board of directors regarding the winner of the tender for financing the purchase of 12 A320s/A319s. The banks are Ceskoslovenska obchodni banka a.s., BNP Paribas and Natexis Banques Populaires. CSA will finance its new airplanes valued at CZK10-CZK12 billion ($402.4-$482.9 million) through a 12-year financial leasing guaranteed by European export credit agencies. The aircraft will be delivered in 2006-08.
Cargo Connection Logistics Corp., a wholly owned subsidiary of Cargo Connection Logistics Holding, was chosen by Continental Airlines to provide over-the-road service between Newark and 10 points located in the US Northeast and South.
Wizz Air signed an agreement to lease a new IAE V2500-powered A320 from ILFC. The aircraft will seat 180 in a single-class configuration. It will be delivered in April 2006 on a seven-year lease term. Volito Aviation added two A320s to its portfolio via a sale/leaseback with TACA. The aircraft are on lease with the Central American carrier through October. Financing was provided by DVB Bank AG. Volito placed a 1998 A320 with Sichuan Airlines on lease through July 2011. It is financed by PK Airfinance Luxembourg.
Primarily owing to an extraordinary loss on the sale of group-owned real property, ANA Group reported a 10.9% drop in net income to ¥2.16 billion ($19.3 million) for the fiscal first quarter ended June 30 from net income of ¥2.43 billion in the year-ago period.
KLM last week signed a five-year, €540 million ($658.9 million) credit facility that is supported by an international group of 11 relationship banks. Citibank, ING Bank, Rabobank and Societe Generale acted as mandated lead arrangers and bookrunners, while Calyon and Natexis-Banques Populaires were co-mandated lead arrangers. BNP Paribas, Credit Mutuel-CIC, Deutsche Bank, Fortis and WestLB were arrangers.
LOT Polish Airlines minority shareholders agreed to an IPO of the state-controlled carrier, which should lead to a market debut by the second quarter of 2006. The airline announced last week that it wants a listing in the middle of next year. CEO Marek Grabarek confirmed that the shares owned by an investor syndicate will be sold along with newly issued shares. "The Polish government will retain control of the company with 51%," he told this website earlier.
Lufthansa's Terminal 2 in Munich will handle more than 20 million passengers this year, a record. Karl-Ulrich Garnadt, head of Hub Management Munich for LH, told ATWOnline that the carrier and its partner airlines are growing at the hub at a faster rate than had been expected; "In June we saw a passenger increase of 13%.
There is no shortage of warnings about the perils of the airline industry and the folly of not learning from its turbulent history. But the harsh lessons of the past are being ignored by many new low-cost carriers, say some analysts, who predict that the boom soon will turn into a bust.
Airbus welcomed Gustav Humbert as its new president & CEO and announced several appointments. Executive VP-Operations Gerard Blanc is leaving the company and is succeeded by Karl-Heinz Hartmann, Charles Champion becomes COO and deputy to the CEO and remains head of the A380 program, John Leahy becomes COO-customers, Tom Williams is executive VP-programs, Alain Flourens succeeds Hartmann as executive VP & head-center of excellence, Henri Courpon becomes head of procurement and Olivier Andres becomes executive VP-strategy & cooperation.
The return of air traffic to the near-saturation levels that existed prior to 9/11-with virtually no corresponding increase in airport capacity-means that congestion and delays are on the rise again. Thus it is no surprise that airlines are looking for information technology solutions to manage aircraft better in the airport environment. A number of IT providers are offering integrated packages to do just that. Sensis Corp. and Preston Aviation Solutions, a Boeing subsidiary, are two major players.
You joined BA as chief executive in May 2000 and will leave the company next month. What do you feel was your biggest accomplishment during these five years? The single most important thing is that we are in substantially better shape than we were at 9/11, despite the effect of 9/11, SARS, the Iraq war . . .
JAL Group recorded a net loss of ¥38.3 billion ($341.7 million) for its fiscal first quarter ended June 30, improved slightly from a net loss of ¥40.7 billion in the year-ago period. Total operating revenue was up 5% to ¥503.3 billion but operating expenses totaled ¥535.4 billion, resulting in an operating loss of ¥32 billion compared to an operating loss of ¥30.2 billion last year. The carrier said the loss is consistent with its performance over the past 12 years and it usually makes up the deficit with profits earned in the second quarter.
Iberia Group earned €45.3 million ($54.9 million) in the second quarter ended June 30, down 37.3% compared to a profit of €72.3 million in the year-ago period, while net earnings for the first half of 2005 fell 53% to €29.2 million from €62.2 million in 2004. The company said the decline in half-year results "stems from the 20% hike in fuel costs and the extraordinary income in 2004 from the divestment of Iberswiss and the flight simulator center, which increased first-half 2004 results by €33 million."
Assn. of Asia Pacific Airlines last week released preliminary traffic results for June. International passengers carried by AAPA members reached 10.6 million, an increase of 5.2% year-on-year. RPKs grew 6.7% on a slower capacity rise of 6%, resulting in a 0.5-point improvement in load factor to 74.7%. FTKs rebounded from last month's decline to increase 3.3% year-on-year. However, the increase in capacity outpaced FTK growth at 5.9%. As a result, load factor declined 1.7 points to 66.6%.
Although it has shed billions in costs during its second restructuring, US Airways Group posted a $62 million net loss for the second quarter ended June 30, which included $26 million in one-time charges consisting of $19 million in professional fees, $6 million in damage and deficiency claims on rejected aircraft and $4 million of severance that was offset slightly by $3 million in interest on accumulated cash. This compares to a net income of $34 million in the year-ago period. Excluding one-time items, net loss for the 2005 second quarter totaled $36 million.
World scheduled passenger airline traffic is expected to reach 3.71 trillion RPKs this year, up 7.6% compared to 3.44 trillion RPKs in 2004, followed by 6.5% growth in 2006 and 6.2% in 2007, according to ICAO's latest medium-term forecast. The strongest growth is expected from Middle East airlines, with an average annual growth rate of 10.9% over the three-year forecast period.
Frontier Airlines posted a $2.7 million net loss in the fiscal first quarter ended June 30, improved from a $6.6 million net loss in the year-ago period. The 2005 first quarter included several one-time items such as a $3.3 million charge related to three leased 737-300s the carrier stopped using during the quarter and an unrealized loss on fuel hedges of $1 million.
United Airlines cabin staff, represented by the Assn. of Flight Attendants, went on the offensive yesterday with coordinated demonstrations at airports in the US, Europe and Asia, threatening to strike in protest over the termination of their pension plan. "Current United management has held its employees and creditors hostage in Chapter 11 for nearly 1,000 days," union head Greg Davidowitch said. "We're hitting the streets around the globe to demonstrate our resolve. We want our pensions back, and we want this management team out."
Midwest Air Group reported an $8.2 million net loss for the second quarter ended June 30 compared to a $3.5 million net loss in the year-ago period. The company attributed the results primarily to the increase in fuel prices and some unusual items. Operating loss also widened from $2.9 million to $8.2 million. Despite the red ink, Chairman and CEO Timothy Hoeksema said he believes the company is making significant progress to return to profitability.
JP Morgan analyst Jamie Baker does not believe Delta Air Lines will file for Chapter 11 this year despite CEO Gerald Grinstein's Tuesday letter to employees warning them that the level of savings being achieved "is not enough" ( ATWOnline, July 28). In a report released after Grinstein's memo was made public Wednesday, Baker noted that, "market speculation appears largely focused on a bankruptcy as early as. .
Continental Airlines placed an order with Boeing for two additional 777-200ERs for its international expansion. The aircraft are scheduled for delivery in the first quarter of 2007 and Continental said Boeing agreed to provide backstop financing. Currently, the airline operates 18 777-200ERs in a two-class, 283-seat configuration.
Hefty special charges overshadowed an improved operating performance at United Airlines during the second quarter as parent UAL Corp. reported a loss of $1.43 billion for the three months ended June 30 net of $1.39 billion in one-time reorganization items. In the year-ago period, UAL had a net loss of $247 million, a figure that included $144 million in reorganization items. Excluding one-time items in both periods, the company reduced its loss to $26 million from a deficit of $103 million in 2004.
Delta Air Lines yesterday unveiled some details of its upcoming fall schedule that it says is designed to improve its operational reliability at its Atlanta hub. Under the schedule that goes into effect Sept. 1, the carrier plans to reduce to 45 min. the minimum time narrowbody aircraft spend on the ground between flights--a 10-min. reduction over last year; make better use of aircraft by freeing up the equivalent of eight additional aircraft from the schedule, and adjust flights in off-peak periods to match capacity better with demand in the fall when air travel slows.
