Air Malta CEO expects sharp reduction in losses

Air Malta expects to sharply reduce its losses this year as it enacts its turnaround plan, Air Malta's Chief Executive Peter Davies said.

Speaking to leading aviation magazine Air Transport World, Davies said the airline's operating loss for the year ended March 2013 will be around €15 million, compared to the figure of €55 million projected operating loss in the adjusted budget of Air Malta two years ago.

"This is in-line with the milestones in the EU approved Restructuring Plan," Davies said.

According to Air Malta's financial results issued in January, the operating loss had been reduced to €4.8 million from the €9.8 million registered during the same period in 2011.

The net result position after restructuring costs - mostly one-time charges - and interest costs is a loss of €8.5 million as anticipated in the Restructuring Plan approved by the Commission.

National airline Air Malta registered a €30 million operating loss at the end of its financial year in March 2012, registering an improvement of €4.3 million over 2011.

The airline had said the year's performance was adversely affected by €21 million in total losses, namely incurred by increased fuel prices of €17 million and €4 million losses from the reduction in flight capacity.

As part of its restructuring programme, approved by the European Commission in 2012, Air Malta had to reduce its flight capacity and route network by 10% in 2011 and another 10% this year. The airline's plans are to break even by 2015.

Air Malta's CEO  was the guest speaker at the European Regional Airline Association (ERA) annual conference in Edinburgh this week. This conference, attended by around 200 delegates from various European airlines, centred on the core issues affecting today's aviation in Europe.

During the conference's first session entitled, 'Facing today's challenges to achieve a more stable future', Davies addressed the issue of how the European regional aviation industry is facing up to today's challenges that include the Eurozone crisis, unpredictable fuel costs, consumer behaviour and EU aviation policy decisions.