-Net profit of KD 1.1 million, best Q1 since inception
-Third consecutive quarter of profits at both
-Operating and net levels
-Operating expenses down 20.4% from Q1 2010
Freedom Town, Kuwait – May 3, 2011 — In a live webcast with financial analysts from over 30 international financial institutions, Jazeera Airways Group today announced a first quarter (Q1) net profit of KD 1.1 million, up from a net loss of KD 4.5 million in Q1 2010, making Q1 2011 the Group’s third consecutive profitable quarter since the introduction of the company’s Turn-Around Plan in mid-2010, and the best Q1 since inception.
Q1 2011 Financial highlights:
- Operating revenues: KD 11.4 million, up 22.6% from Q1 2010
- Operating profit: KD 1.8 million, compared to an operating loss of KD3.3 million in Q1 2010
- Operating expenses: KD 9.6 million, down by 23.8% from Q1 2010
- Net Profit: KD 1.1 million, compared to a net loss of KD 4.5 million in Q1 2010
Q1 2011 Operational highlights:
- Average yield up 41% from Q1 2010
- Load factors up 26.7% from Q1 2010
- Aircraft utilization up 7.3% from Q1 2010
Jazeera Airways Group had registered KD 4.4 million in net profit for the third quarter (Q3) of 2010, and KD 2 million in net profit for the fourth quarter (Q4) of 2010. Both Q3’10 and Q4’10 results were record breaking as well. Jazeera Airways Group Chairman Marwan Boodai told analysts, “We are very pleased with our record first quarter results, which demonstrate Jazeera Airways’ success in mitigating the impact of the political unrest seen in the Middle East in the last quarter. We were able to secure this success because of the flexibility we enjoy within the Jazeera Airways Group between our aircraft leasing business, which has assets deployed across the world, and our commercial airline business that serves 18 destinations across the Middle East. Combined, they have not only shielded the Group’s performance from these events, but they have also put the company on a winning streak for three straight quarters”. Boodai added, “Our outlook for the second half of the year remains unchanged, however we have upgraded our Q2 outlook from ‘slow’ to ‘mild’ as we welcome the inclusion of Cairo into our network starting from May 18. We remain focused on making every quarter of 2011 a profitable quarter as we have successfully strived for over the last three quarters.” Jazeera Airways Group operates in the aviation industry, which tends to experience travel demand highs in the summer season and travel demand lows in the winter season. About the company’s Turn-Around Plan: Since inception in late 2005, Jazeera Airways Group has been profitable every year until 2009, when it registered a net loss for the first time ever due to the overcapacity that was dumped in the market by existing government airlines and new players as well. The Turn-Around Plan was created as a direct response to this situation and aimed at solving this external challenge by resizing its own operations internally, and to ultimately bring the Group back to profitability. Implemented in May 2010, the Turn-Around Plan included asset redeployment, staff reductions, rigorous cost management, network/market alignment and enhanced commercial offering, which were rolled over the several months that followed. The Plan began yielding results immediately and above expectations. Within the first three months, Jazeera Airways Group closed its best performing quarter in history when it reported a net profit of KD 4.4 million for the period Q3’10. Six months into the plan, Jazeera Airways closed the Q4’10 with a net profit of KD 2 million. Though Jazeera Airways had been profitable on an annual basis prior to 2009, this was the first time that it closed two consecutive quarters with positive results at both ‘operating’ and ‘net’ levels. This was a clear sign to the market that the Group is well into sustaining profitability. Today’s earnings announcement for Q1’11 is the third consecutive quarter since the implementation of the Turn-Around Plan.