Aided by its fuel hedges, Southwest Airlines reported a $76 million net income for the first quarter ended March 31, nearly tripling the $26 million earned in the year-ago period. However, 2004 first-quarter results included $18 million in pre-tax operating expenses related to the consolidation of reservations operations. "Considering the many challenges our industry continues to face, we are grateful to report first-quarter earnings of $76 million," CEO Gary Kelly said.
Aer Lingus posted a 29% increase in operating profit before employee profit-sharing to €107 million ($137.1 million) for the year ended Dec. 31, up from €83 million in 2003. Net profit, however, tumbled 98% to €1.2 million from €69.2 million owing to exceptional charges of €102.5 million, of which €97.9 million was related to voluntary severance and early retirement benefits as part of implementation of the carrier's three-year business plan.
Olympic Airlines' privatization has attracted bids from four companies. According to Reuters, which cited financial daily Imerisia, Aegean Airlines was the first to confirm its interest, while Germany's DBA, Dutch investment fund Sure Eastate and a consortium that calls itself Olympic Investors also tabled binding bids.
Ryanair said it reached agreement with Infratil to base up to four new 737s and deliver up to 2 million passengers per year to Lubeck Airport. The city of Lubeck lies approximately 41 mi. northeast of Hamburg near the Baltic coast. The agreement is subject to successful completion of a conditional purchase deal between the city, which owns the airfield, and Infratil, an international airport and infrastructure investor that owns Wellington International and Glasgow Prestwick.
Iberia said yesterday that it expects to book a pre-tax gain of €600 million ($775 million) through the sale of its Class A shares in Amadeus Global Travel Distribution. After the offer, Iberia will maintain an "indirect stake" in Amadeus representing a maximum of 11.44% through its investment in WAM Acquisitions, a newly incorporated company created as the vehicle for the Amadeus offering. Its investment in WAM will be €102 million.
Japan Airlines, responding to four safety incidents and a rebuke in March from the Civil Aviation Bureau of the Ministry of Land, Infrastructure and Transport that resulted in a major shakeup in the airline's management, announced a series of measures to improve safety monitoring and reporting within the organization. JAL established a new Safety Measures Committee comprising the president, executive VP, executive directors for safety and executives from the flight operations, maintenance, cabin attendants, airport operations and cargo departments.
Finnair flew 1.59 billion RPKs in March, up 12.1% over the year-ago period. Capacity climbed 8.5% to 2.15 billion ASKs and load factor gained 2.3 points to 74.1%. For the three months ended March 31, RPKs increased 7.4% to 4.32 billion, ASKs rose 5.3% to 5.89 billion and load factor grew 2 points to 73.4%.
KLM and Portugalia Airlines will start codesharing next week. Under the agreement, KLM will add its code to PGA's daily service between Amsterdam and Oporto and PGA will codeshare on KLM's scheduled service between Lisbon and Amsterdam. The Portuguese carrier already operates under codeshare agreements with Air France and Air Europa.
BAE Systems will provide actuator control electronics units for 777s through 2012 under an agreement with Boeing. BAE has supplied this type of equipment to Boeing since 1990 under a contract that was set to expire at year end.
Qantas said it will install CCTV surveillance equipment in baggage handling areas at terminals throughout Australia that are either owned or solely leased by the airline. CEO Geoff Dixon said the carrier also will place surveillance equipment in the holds of some of its aircraft and at other airport locations and increase "loss prevention measures," including increased inspections of staff entering and leaving the workplace. He said the decision to upgrade security measures was a result of "heightened public concern around security of baggage."
Alaska Air Group flew 1.46 billion RPMs in March, up 10% over the year-ago period. Capacity climbed 1.9% to 1.88 billion ASMs and load factor gained 5.8 points to 77.9%. For the three months ended March 31, RPMs increased 8.9% to 3.9 billion, ASMs rose 3.7% to 5.37 billion and load factor jumped 3.5 points to 72.6%.
Telair International announced a firm acceptance from China Southern Airlines for 18 sliding carpet loading systems for its fleet of nine 737-800s, which China Southern will take over in mid-2005 from ATA Airlines.
Air France and KLM are raising their fuel surcharges. The fuel levy on Air France tickets issued in France will rise by €1 ($1.29) on domestic flights, €2 on medium-haul flights and €8 on long-haul flights from April 20. KLM is adding €6 on long-haul flights and €3 on European flights effective April 15.
Shareholders of Virgin Express and SN Brussels Airlines successfully concluded merger negotiations and yesterday confirmed the terms of the deal that sees the two Brussels-based carriers come under common ownership while maintaining operational independence. Virgin Express will continue to target the low-cost market with SN Brussels remaining a full-service airline. Further plans and expected synergies have not been revealed, but under terms of the deal the Virgin brand has to be eliminated by 2007.
Air China reported net income of 2.39 billion yuan ($288.8 million) in 2004, up significantly over 160 million yuan earned in the prior year, as operating income almost doubled from 2.28 billion yuan in 2003 to 4.49 billion yuan. Chairman Li Jiaxiang said 2004 was a year in which "we achieved several milestones as we restructured the company, streamlined our organizational structure and successfully listed our shares in Hong Kong and London."
Alteon is opening a new training facility near Singapore Changi, President Pat Gaines announced yesterday at the World Airline Training Conference and Tradeshow in Dallas. Set to open in the first quarter of 2006, the center will be able to train more than 6,000 pilots and flight attendants annually. "The three-story facility will house six full flight simulators and other advanced-technology training devices such as flat panel trainers," the company said.
ACE Aviation Holdings, in conjunction with its previously announced debt and equity offering ( ATWOnline, April 8), said underwriters elected to exercise in full their overallotment options to purchase an additional 1.135 million Class A shares at C$37 per share ($29.83) and C$30 million of 4.25% convertible senior notes due 2035. This resulted in additional gross proceeds of C$72 million, bringing the total to C$792 million.
Northwest Airlines would not confirm a report in Tuesday's Wall Street Journal that it is set to order up to 18 787s. In a statement, an airline spokesperson said, "We continue to speak with aircraft manufacturers about their product offerings." An NWA order would be a big win for Boeing and a setback for Airbus because the carrier operates the A330 and has a number still to be delivered. Separately, on Monday Northwest and China Southern Airlines inked a new partnership that includes reciprocal frequent-flier and airport lounge benefits.
L-3 Communications Security & Detection Systems received an order from the US Transportation Security Administration for eXaminer 3DX explosives detection systems. The deal is valued at $33 million.
Continental Airlines announced that Senior VP-Flight Operations Debbie McCoy will retire. The company said her position will not be filled and her team will now report to Executive VP Operations Mark Moran.
China Eastern Airlines reported a net profit of 514.1 million yuan ($62.1 million) in 2004, a complete reversal from a net loss of 949.8 million yuan in 2003. According to the Associated Press, revenue during the year rose 47.3% to 21.04 billion yuan.
Riga-based airBaltic said its revenues rose 54% in 2004 to €74.4 million ($96.1 million) but extraordinary costs associated with the investment in its new hub in Vilnius, fleet restructuring and the significant increase in fuel prices caused it to report an annual loss of €1.2 million. The carrier, which is owned jointly by Latvia and SAS, carried 589,288 passengers, up 75% over 2003, as it launched nine new routes from Riga and opened 11 routes from Vilnius.
Styrian Spirit, a Regional carrier based in Austria, expects its shareholders to approve an increase in share capital of €840,000-€1.2 million ($1.1-$1.6 million) at an April 28 meeting. The airline will take delivery of a new CRJ700 by this summer, simultaneously withdrawing a CRJ200. "With the delivery of a second CRJ700 next year, our fleet will grow to a total of five aircraft," CEO Otmar Lenz told ATWOnline. The carrier, which also operates under the name Slovenian Spirit, plans to start services from Maribor in Slovenia to Dubrovnik.
