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AFRAA AGM: Kenya operator calls for consolidation

aPeaford — Mon, 20 Nov 2023 14:06:23 +0000

Alex Avedi, CEO of Wilson Airport-based Safarilink Aviation said that the airline industry – particularly among the national carriers was fragmented and as such could never compete with the assets and capacity of international carriers.

Each of the carriers across the former East Africa Community have just a handful of widebody aircraft.

Speaking at the CEO panel at the AFRAA annual general assembly, Avedi said: “On average, African carriers only have like six aircraft. The truth of the matter is, we are still so obsessed with flag carriers. Look at Kenya, Uganda, Rwanda, Tanzania all setting up, their own widebody fleets.

“But it is all very fragmented. If you look at the days of the East African Community it's tougher. We have limited resources. We have all these delusions of grandeur with our fleet of six, and Middle Eastern airlines are coming in with hundreds of widebodies. We call it dumping capacity, but all it is really is capacity.

“We will never be able to play the game,” he said.

Avedi said creating a liberalised market – or bringing back an East African community would make massive savings for passengers, Kenyan domestic charges are around $4 but crossing a neighbouring border sees charges rise to $50 or $60.

The difference would compare a domestic flight to Mombasa costing $160 return, while the same flight time to neighbouring Tanzania would see tickets costing more than $300.

“Each night 15 buses take passengers the 12 hour trek from Kampala to Nairobi. That journey could be done by plane in an hourif we can open the way and drop the charges,” he said.

Kenya Airways CEO, Allan Kilavuka responded from the floor saying he agreed with Avedi.

“Consolidation of this fragmented aviation industry is critical for sustainability of aviation,” he said. “I was reading an article about Europe, Europe is consolidating more such as Air France, KLM and SAS. But in Africa, what are we doing? in fact the subscale aviation industry that we have in this continent grows, and we are our own enemies.”

Posted date

Mon, 20/11/2023 - 12:00

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A Kenyan airline CEO has encouraged airlines in East Africa to think again about consolidation of national carriers to break down barriers to travel through the region.

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AFRAA AGM: Nigeria's debts threaten airline financial security warns Al-Awadhi

aPeaford — Mon, 20 Nov 2023 09:12:19 +0000

Speaking at the 55^th African Airlines Association (AFRAA) annual general assembly being held in Kampala, Uganda, Al-Awadhi said blocked funds was the biggest single issue affecting airlines with oil-rich Nigeria the worst culprit.

“There are CEOs here, and not here, who talk to me saying, ‘Look, we're running out of cash, can you solve this issue with Nigeria? And they are African airlines.

“Nigeria, the strongest economy in Africa, and also10th in exporting oil countries, has the highest debt to the aviation industry in the world, the number one debt by far compared to everybody else and it charges the highest fees to fly in and out of Nigeria,” he said.

“How can Nigeria turn around simply and say, ‘Oh, I'm sorry, X African airline, I'm sorry, you're in debt, and you can't operate any more while I'm still going to import beef from South Africa, lobsters, shrimps, toothpicks’, the list is a mile long. The non-essential stuff that they consume their dollars for luxury items while they will not pay their bills. This has to stop!”

Al-Awadhi said the situation is getting to a point where countries are no longer respecting the bilateral agreements. “What shocks me is I have been addressing this for the last two years, and every time I managed to squeeze it down a few dollars, it jumps another $150.”

He said that the bad debt to airlines from the Nigerian government will pass the billion dollar mark by the start of 2024.

He called to airlines to push their own governments to open channels with their opposite numbers in Nigeria to address the critical debt.

He also warned Nigeria that its hopes for foreign investment in new projects would be affected.

“How is Nigeria expecting anybody to trust its government and invest ,” he said. They're looking for foreign investment, but nobody's going to invest in a country that doesn't give them money back.”

Al-Awadhi also hit out at other African governments for unsustainable and unreasonable charges to the aviation sector. Passenger cost via Lagos or Abuja was two and a half times greater than Doha or Dubai. African carriers -often owned by the government faced an environment of increasing charges, levies, taxes, and governments that do not invest in infrastructure. “It costs almost 26.5% interest on any loan you take for aviation,” he said. MRO activities are also threatened and the hope for investment in MRO on the continent at risk.

“if you open an MRO and you say, we're going to service airlines of Europe for example, a airline will get taxed when it brings spare parts and to fix an aircraft that's leaving Africa anyway.

“The high costs in Africa, are the most choking elements for the aviation industry in Africa,” he said.

Posted date

Mon, 20/11/2023 - 12:00

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IATA’s regional vice president Africa and Middle East, Kamil Al-Awadhi railed against Nigeria’s stance on blocked funds that could cripple African and other airlines and ultimately affect air travel to the West African powerhouse.

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Emirates records record first half profits

aPeaford — Thu, 09 Nov 2023 07:04:22 +0000

The Group also reported an EBITDA of AED 20.6 billion (US$ 5.6 billion), a significant improvement from AED 15.3 billion (US$ 4.2 billion) during the same period last year, illustrating its strong operating profitability.

Group revenue was AED 67.3 billion (US$ 18.3 billion) for the first six months of 2023-24, up 20% from AED 56.3 billion (US$ 15.3 billion) last year. This was driven by strong demand for air transport across the world, which has been on an upward trajectory since the last pandemic travel restrictions were lifted.

The Group closed the first half year of 2023-24 with a solid cash position of AED 42.7 billion (US$ 11.6 billion) on 30 September 2023, compared to AED 42.5 billion (US$ 11.6 billion) on 31 March 2023. The Group has been able to tap on its own strong cash reserves to support business needs, including debt payments. So far, Emirates has repaid AED 9.2 billion of its COVID-19 related loans. The Group also paid AED 4.5 billion in dividend to its owner, as declared at the end of its 2022-23 financial year.

Sheikh Ahmed bin Saeed Al Maktoum, chairman and chief executive, of the Dubai-based airline group said: "We are seeing the fruition of our plans to return stronger and better from the dark days of the pandemic.

"The Group has surpassed previous records to report our best-ever half-year performance. Our profit for the first six months of 2023-24 has nearly matched our record full year profit in 2022-23. This is a tremendous achievement that speaks to the talent and commitment within the organisation, the strength of our business model, and power of Dubai’s vision and policies that has enabled the creation of a strong, resilient, and progressive aviation sector.

"Across the Group, we’ve continued to ramp up operations safely and move nimbly to meet customer demand. We’ve implemented a series of service and product enhancements to win customer preference, and we’ll continue to invest in our people, products, partnerships, and technology to strengthen our capabilities and ensure we are future ready."

Posted date

Thu, 09/11/2023 - 12:00

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The Emirates Group today announced its best-ever six-month financial result. The Group is reporting a 2023-24 half-year net profit of AED 10.1 billion (US$ 2.7 billion), surpassing its record half-year profit of AED 4.2 billion (US$ 1.2 billion) last year by 138%.

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Royal Jordanian registers US$ 38,770net profit in Q3

eNethersole — Mon, 06 Nov 2023 11:30:37 +0000

The company also registered revenue of JD232.8 million in the third quarter of 2023, a 16% increase, while over the same period last year, it made JD201.2 million.

RJ Vice Chairman/CEO Samer Majali said that the number of passengers in Q3 of this year went up by 22%, when RJ aircraft transported 1.1 million passengers, whereas, in the corresponding period of last year, it carried 900,000 passengers. This meant a 1.1-point higher seat load factor, from 78% in the comparison period of 2022 to 79.1% in 2023.

In the first nine months of this year, RJ attained a JD10.8 million net profit after tax, while it incurred a JD71.6 million loss in the same period last year. The operating revenues in the January-September period of 2023 increased to JD581.5 million from JD452.2 million in 2022, recording an increase of JD129.3 million; i.e. 29% growth over the same period last year. This is mainly attributed to the 36% increase in passenger revenues, which reached JD130.2 million, due to a 24% increase in the number of passengers, from 2.3 million in the first nine months of 2022 to 2.8 million in the comparison period of 2023. The fuel bill also went down in the first nine months of 2023, to JD13.7 million.

Majali said that the positive results in the first nine months are the fruit of the new strategy of the national carrier that endeavours to project Jordan as a tourist destination and make Amman a gateway to the region, as well as of the collective effort exerted by the RJ management and staff to improve performance.

Majali said that despite the good results, RJ’s operating performance has started to see the the impact of current situation in the region, particularly since Jordan is an access point to the Levant region, but is geographically close to the conflict. Royal Jordanian, which is entering a tourism season, has recorded a 13% reduction in reservations and anticipated revenues by the end of this year. Along with this loss of revenues, the airline is also having to cope with higher fuel costs and the need to fly longer routes to avoid conflict airspace.

He added that RJ has to take all necessary measures to reduce the effects as much as possible by determining and reducing the offered seat capacity and controlling expenses in an attempt to maintain the results of the third quarter and reach the break-even point by the end of this year.

Posted date

Mon, 06/11/2023 - 12:00

First paragraph

Royal Jordanian recorded a JD27.5 million (US$ 38,770) net profit after tax in the third quarter of 2023.

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IndiGo reports its second quarter fiscal year 2024 results

eNethersole — Fri, 03 Nov 2023 13:36:34 +0000

For the quarter ending September 2023, seasonally the weakest quarter, IndiGo reported a profit of INR 8,061 million excluding foreign exchange loss. Including a foreign exchange loss of INR 6,171 million, net profit for the quarter aggregated to INR 1,889 million.

For the quarter ended September 30, 2023, compared to the same period last year

• Capacity increased by 27.7%

• Passengers increased by 33.4% to 26.3 million

• Yield declined by 12.4% to INR 4.44 and load factor improved by 4.1 points to 83.3%

• Revenue from Operations increased by 19.6% to INR 149,439 million

• Reduction in fuel CASK by 26.7% to INR 1.66

• CASK ex fuel decreased by 12.1% primarily due to reduction in foreign exchange loss

• EBITDAR of INR 24,464 million (16.4% EBITDAR margin), compared to EBITDAR of INR

2,292 million (1.8% EBITDAR margin)

• Excluding foreign exchange loss, profit amounted to INR 8,061 million compared to loss of INR

3,818 million

• Net profit of INR 1,889 million, compared to net loss of INR 15,833 million.

Company’s CEO, Pieter Elbers said: “I am pleased to report yet another profitable quarter despite the seasonal fluctuations and external headwinds coming into play. With our clear strategy and focus on execution, we have completed a full cycle and remained profitable for the last four quarters. We continued to augment our network both domestically and internationally as we added 10 new destinations in the past few months, taking the total number of destinations to 115 as of today."

"My deepest gratitude to all 6E employees for their hard work, determination, and passion they bring to their roles in serving our loyal IndiGo customers.”

Revenue and Cost Comparisons

Total income for the quarter ended September 2023 was INR 155,029 million, an increase of 20.6% over the same period last year. For the quarter, our passenger ticket revenues were INR 130,690 million, an increase of 17.6% and ancillary revenues were INR 15,510 million, an increase of 20.5% compared to the same period last year.

Posted date

Fri, 03/11/2023 - 12:00

First paragraph

IndiGo has delivered profitable growth demonstrating effective execution of its plans and strategy coupled with strong demand.

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Qatar Airways Group reports strong first half year financial performance

eNethersole — Thu, 02 Nov 2023 11:21:14 +0000

Qatar Airways Group reported a net profit of QAR 3.736 billion (US$ 1.026 billion) for first half of fiscal year 2023/2024 which represents an increase of 113.8% compared to the same period last year 2022/2023. The Group’s total revenue for first half of fiscal year 2023/2024 increased to QAR 40.126 billion (US$ 11.019 billion), up 7.4% compared to the same period last year 2022/2023. Passenger revenues rose 28.5% over the last year with increased load factors of 83.3% generating higher yields of 3.6%.

Qatar Airways total passenger count for the first six months ending September-2023 increased to 19.078m, representing an increase of 22.5% compared to the same period last year. A key component of the commercial success of the business has been delivered through innovative partnerships within oneworld and through other global strategic alliances in Australasia, Europe and China in particular. Fleet expansion and loyalty programmes are pivotal to growth and Qatar Airways Group has around 150 aircraft on order to fulfil this increasing demand for passenger and freighter traffic. Operational efficiencies, innovation programmes and staff development have all additionally contributed to these results.

There are a number of headwinds facing the Group for the remainder of the year including geopolitical tensions in a number of parts of the world. This could have an impact on passenger demand for air travel, as well as potentially create operational constraints. The cost of fuel remains the single largest concern. Exchange rate fluctuations resulting from a strengthening US Dollar have impacted performance to date. A wide variety of operational measures have increased on-time performance to the highest levels experienced in recent years, which is a testament to the collaborative efforts of the leadership team. Management expects to continue the strong performance despite the headwinds in the second half of 2023-2024.

Qatar Airways Group chief executive, Akbar Al Baker, said: “Qatar Airways Group is a unique business that continues to perform at the highest level in the aviation industry. The FIFA World Cup Qatar 2022, created a very solid base on which to build Qatar’s ambition to grow as a leading tourism destination in the Middle East, one that focuses on refinement, culture, value and customer service and therefore being a family orientated destination. The interim results this year indicate that the Group is tracking towards another very strong year, which builds upon over US$ 2.750bn cumulative profits from the previous two years.”

The Group’s EBITDA margin of 26.9% for first six months of fiscal year 2023/2024 improved compared to same period last year 2022/2023 by 4.9 percentage points at QAR 10.779 billion (US$ 2.960 billion). EBITDA was higher than the same period last year 2022/2023 by QAR 2.641 million (US$ 0.725 million).

In early March the company announced a number of new routes including Chittagong, Juba, Kinshasa, Lyon, Medan, Toulouse, and Trabzon, most of which services have commenced to date. Qatar Airways also announced resumptions to 11 destinations: Beijing, Birmingham, Buenos Aires, Casablanca, Davao, Marrakesh, Nice, Osaka, Phnom Penh, Ras Al-Khaimah, and Tokyo Haneda. Up to 10 new destination have been identified additionally for 2024.

Posted date

Thu, 02/11/2023 - 12:00

First paragraph

Qatar Airways Group has reported a ‘strong’ financial performance for the first half of 2023/2024.

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Arabian Aerospace Special Report - Saudi Aviation & Vision 2030 out now!

Ethan Cobbing — Mon, 30 Oct 2023 12:30:44 +0000

The programme launched by Saudi Crown Prince and Prime Minister HRH Mohammed bin Salman Al Saud aims to achieve the goal of increased diversification economically, socially and culturally – and five years in, the plan has been adopted, and is driving Saudi business and people.

The aviation industry is often slow to adapt and adopt change, but anyone visiting the kingdom will immediately recognise that the drive toward change is working. For the industry, the strategy is in place. The goal is to turn Saudi Arabia into a leader in the global industry; enhance the customer experience; improve safety and promote long-term environmental sustainability.

The strategy will also empower growth in the tourism sector as the country welcomes the world. This means delivering seamless experiences to 330 million passengers across 250+ destinations and through transportation of 4.5 million tons of air cargo by 2030. The introduction of the speedy tourist visas has already seen that working. And to meet the demands, progress is being made to develop the most modern airline fleets in the world to service domestic, regional and transcontinental flights.

The joined-up thinking is apparent. Conferences and exhibitions are heading to the kingdom; global football stars, boxers and golfers are flying in to play at world-class facilities. Beach resorts are under development and a spanking new world-class airline is being built to service the world-class airports under construction.

This special supplement, drawn together by the editors and correspondents from Arabian Aerospace magazine, provides a snapshot of the progress so far as we talk to airline leaders, regulators, airport consultants and look at how some of the leading companies in the sector are working to be part of the Vision. It is a brave new world – and it is an exciting one. Fasten your seatbelts and enjoy the ride.

View the special report here

Posted date

Mon, 30/10/2023 - 12:00

Short title

Arabian Aerospace Special Report - Saudi Aviation & Vision 2030 out now!

Short summary

In this special report: Arabian Aerospace delivers an exclusive overview of Saudi aviation and vision for 2030.

First paragraph

Saudi Arabia is often an enigma. From the outside it can seem secretive and ultra-conservative – but once inside there is an incredible open and passionate belief that the kingdom has what it takes to be a beacon for the future in the Middle East. At the heart of a remarkable change is Vision 2030.

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A twist in the tale of the Sukhoi SuperJet 100

pIvanova — Wed, 18 Oct 2023 11:42:08 +0000

Business and finance 18 October 2023

A twist in the tale of the Sukhoi SuperJet 100

Dubai-based Mark AB Capital Investment (Mark AB) has acquired its entire stake in SuperJet International from Russia's United Aircraft Corporation (UAC) which manages the SuperJet 100 regional jet programme.

Will this acquisition enable the United Arab Emirates to finally get this regional plane take off? The Relaunch Plan drawn up in the wake of this deal looks like a good omen for the aircraft.

"This agreement has a great value for our company, as the interruption of industrial and commercial relations with UAC will allow the company to no longer be burdened by the limitations resulting from the sanctioning regulations set by the European Union", said Camillo Perfido CEO of SJI.

The SSJ100 entered into service in 2011 by Sukhoi in collaboration with the Italian Finmeccanica and various manufacturers including the Safran group, Leonardo and Thales. It had around fifteen operators mainly Russians : Aerosflot, Armavia or Rossiya. Cityjet (Europe) and Interjet (Mexico) operated the SSJ100 internationally.

Seven years later, the SSJ100 was struggling to find customers beyond Russia in a competitive market. The accident which occurred in 2019 during a forced landing at Sheremetyevo Airport in Moscow gave a severe blow to the commercial future of this regional aircraft.

The outbreak of the Russia-Ukraine war sidelined the SSJ 100 on the international market. In March 2022, EASA suspended the certificates of several Russian aircraft including the SSJ100 and future applications such as the Irkut MC- 21. The sanctions includes russian aircraft and airline access in Europe as well as spare parts and flight simulators produced in Russia.

The Italian government has also frozen €146 million of SJI’s assets, including four SSJ 100-95s.

The entry of the new shareholder, and the unfreezing of SJI's shares and assets, represent mandatory prerequisites according to SJI, without which the Relaunch Plan cannot be implemented.

This Relaunch Plan scribed by SJI and Mark Capital AB envisions investments of € 190 million, of which €110 million at the Venice site. This investment will support the development of new aircraft configurations, the construction of the new SJI branch in the UAE, as well as the continuous development of the aircraft to address market competition.

Sales forecasts are estimated to be 240 aircraft at a minimum, in different versions: passenger, business jet and cargo, mainly for the UAE and Indian markets.

Abu Dhabi Investment Office is leading the collaboration with Mark AB Capital Investment and SuperJet International at an industrial level to uphold the development of the civil aviation industry in the UAE. A state-of-the-art facility in Al Ain, Abu Dhabi and transfer of know how and technologies underpin the plan.

According to the MoU signed between the parties last May,SJI will establish a new Final Assembly Line for regional aircraft in Al Ain by mid-2025. In parallel, SJI will set up a new supply-chain for aerostructure work packages in Italy and the UAE by 2026.

Information gathered in the press show that Russia is investing in a 100% Russian regional aircraft like the SSJ 100 by replacing all the parts and subassemblies resulting from Western manufacturers cooperation.

Markab Capital will also help in training and capacity building of UAE nationals in the civil aviation industry as part of its strategy. The UAE aviation industry is gradually gaining momentum. Government initiatives and investment in the aerospace industry is driving robust demand for business partnerships and helping the UAE outpace other regional markets.

The UAE has successfully manufactured aircraft components and is entering a new era in assembling, installing and aircraft manufacturing.

Anuradha Deenapanray

Anuradha is a francophone editor for African and Arabian Aerospace magazines.

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Middle East air connectivity sees 26% growth in 2022

eNethersole — Wed, 20 Sep 2023 13:07:33 +0000

The Middle East saw a 26% growth in 2022, according to a report by Airports Council International Asia-Pacific and Middle East.

Developed in partnership with PwC, the Airport Connectivity Report measures passengers’ ability to access the global air transport network, capturing both direct and indirect routes, and also factoring in the quality of service of each connection, such as destination choice, service frequency, onward connectivity and price, contributing to the passenger experience.

The report covers a sample of 100 airports that accounts for almost 60% of the combined passenger traffic in the region in 2019.

The report revealed that air connectivity in the Middle East stands out with 26% growth in total connectivity in 2022 vs 2019, with direct connectivity to destinations in North America, Asia-Pacific and Africa witnessing the strongest recovery post-Covid.

However, Asia-Pacific has seen a decline in air connectivity by 38% in the same period.

Several key factors contribute to the decline in air connectivity, including extended travel restrictions due to Covid-19, limitations on air traffic rights, constraints on airport slots, rising airfares, economic downturns, and geopolitical tensions.

This decline in air connectivity, coupled with increasing airfares, highlights its negative impact on the recovery of air travel and the resultant inconvenience to passengers.

From the passenger’s perspective, connectivity was said to be ‘essential’ for mobility, providing significant economic and social advantages. However, preliminary rankings for 2023 suggest a positive outlook for the region.

Posted date

Wed, 20/09/2023 - 12:00

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The Middle East saw a 26% growth in 2022, according to a report by Airports Council International Asia-Pacific and Middle East.

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