Transportation Industry

Airline Finance News - Africa / Middle East

AirGuide Business, May 5, 2008

May 5, 2008

Kenya Airways

Kenya Airways said it spends about KES20 billion shillings (USD$322.2 million) of its KES60 billion turnover on fuel. The carrier, partially held by Air France KLM, said it has hedged 50 percent of its fuel needs and was evaluating routes, frequencies and equipment utilization to check fuel costs. "Ultimately, we may need to look at our pricing structure and see how to recover some of our fuel costs," the statement said. May 1, 2008

Nationwide Airlines

Nationwide Airlines of South Africa shut down operations Tuesday following a March and April during which fuel costs climbed 30% and load factors decreased. The carrier has faced difficulties since a November engine separation on a Boeing 737-200 led to grounding of its fleet by the South African Civil Aviation Authority. It said it "attained a gradual recovery of the business" in December and January but was unable to secure investment from a consortium with which it was negotiating. Nationwide operated 11 -200s, two 737-500s, three 727-200s and one 767-300 on domestic and African routes as well as to London Gatwick. May 1, 2008

Royal Jordanian

Royal Jordanian, the first Arab state carrier to be privatized, said on Wednesday revenues rose 31 percent in the first quarter of 2008, driven by robust passenger traffic. Chief Executive Samer Majali said operational revenues rose in the first quarter to JOD140 million dinars (USD$197.4 million) against JOD107 million in the same period last year. The airline reduced its net losses by 22 percent to JOD2.97 million for the first quarter compared to the same period last year. The airline posts better revenues in the peak summer season, with passenger traffic substantially higher. The airline's 2007 net profit rose 22 percent to JOD20.4 million (USD$28.7 million) against the previous year. Airline officials say the carrier's main challenge in 2008 was to offset the impact of higher fuel prices that now constituted around 40 percent of total expenses, up from a third in a typical year. Energy importers like Jordan have been hit by a five-fold increase in oil prices during the last six years. May 1, 2008

Royal Jordanian

Royal Jordanian posted a JOD2.9 million ($4.1 million) loss in the first quarter, a 22% improvement on the loss incurred in the year-ago period. Operating revenue rose 31% year-over-year to JOD140 million, reflecting a 17% increase in passengers carried and a 2-point improvement in load factor to 68%. May 1, 2008

Royal Jordanian

Royal Jordanian saw a 17 percent rise in passenger traffic in the first quarter, while seat factor rose to 68 percent from 66 percent. Last December the government sold 71 percent of the airline to international and local investors in an initial public offering. Foreign investors, including the Beirut-based investment firm controlled by the Mikati family, which acquired a 19 percent shareholding, now own at least 40 percent of the carrier's capital. Local investors, including the government, which still retains a 29 percent stake, have a majority shareholding that exceeds 51 percent to ensure the carrier maintains its right to fly under bilateral accords. May 1, 2008

Royal Jordanian

Royal Jordanian was able to expand its network of 55 directly served destinations to 700 as the only Arab airline in the international airline OneWorld alliance, which includes British Airways, American Airlines and Australia's Qantas The airline's strategy was to create Amman as a regional hub for the Levant region by expanding its regional network and tapping booming air passenger demand in the Middle East. May 1, 2008

Royal Jordanian

Royal Jordanian transported 199,000 passengers in March, up 24% from the year-ago month, as load factor rose 4 points to 73%. For the first quarter, passenger numbers climbed 17% year-over-year to 555,000 and load factor increased 2 points to 68%. Apr 28, 2008

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