.jpg)
.png)
.png)
Air Malta halves first quarter losses in 2013
CEO Peter Davies: Air Malta on track with revenue targets “but much more needs to be done to reduce costs.”
4 September 2013, 12:00am
Matthew Vella
Matthew Vella
3 min read
National airline Air Malta announced it had halved its operating losses, increased revenue and passenger figures in first quarter results for 2013.
The airline said it had reduced operating losses for the quarter to €3.3 million (2012: €6.1 million loss, 2011: €10 million loss), with the net result after one-time restructuring and interests costs of €4.9 million (2012: €10.6m, 2011: €11.5m losses).
Air Malta said the losses were as anticipated in the restructuring plan the airline is undergoing as part of European Commission conditions to receive state aid.
"These figures continue to build on the progress registered during financial year ended in March 2013. They are driven by constant improvements of the airline's revenue of €57 million and by increases in passenger numbers to 498,692 passengers ( over 28,908 passengers or 6.2% from the previous year," the airline said.
The airline registered a seat load factor of 74% over this period.
Performance on scheduled flights for the first quarter met expectations and was significantly better than last year. Air Malta registered its best June in terms of passenger numbers in five years, and an on-time performance - reported for the first time in the airline's quarterly figures - that improved by 5.5% to 84.6%.
"This operational measure indicates the percentage of flights that have departed within 15 minutes of their scheduled time of departure. This is an industry standard measurement of on time performance of an airline and is one of the key performance indicators of the industry. Over the last few months Air Malta has launched a business process re-engineering program of projects to improve its OTP and the good news is that results are being registered," the airline said.
Chief Executive Peter Davies said the results confirmed Air Malta was on its way to financial recovery. "They could not have been achieved without the commitment and dedication of our management and staff that are together working very hard to turnaround this airline.
"In the past two years, the airline has achieved major milestones reducing its losses from a budgeted annual loss of €55 million in financial year 2011/12 to a budgeted €15 million loss in financial year 2012/13. We are meeting the milestones listed in the restructuring plan.
"75% of the 160 projects initiated by the airline have been successfully completed and we are reaping the benefits from the reduction in costs and the increases in revenue these projects are generating. We are on track with our revenue targets but much more needs to be done to reduce costs. We need and can do more."
Davies said the airline's second phase of development will include a significant overhaul of business processes in its back office, cabin and ground services divisions.
"This overhaul is aimed at developing a more customer-centric experience for our passengers and driving costs down. At the same time we will continue to seek to increase revenues, particularly through ancillary sales.
"Let me make myself absolutely clear. Our challenges are still significant and this year we have a tough challenge to achieve the financial breakeven milestone. This requires the understanding and support of all our stakeholders including the employees, unions and suppliers amongst others. The quick wins are now behind us and the road forward requires courage and stamina," Davies said.
Matthew Vella, a freelance journalist at MaltaToday, was formerly executive editor at Malt...
•
Avukat: after 25 years of PN government we are left with a bankrupt government with 6 billion in debts, and all entities bankrupt i.e. Air Malta, EneMalta (900 million), MEPA, Gozo Channel, Water Services, Education Department (60 million), the new Parliament (80 million), and all the rest of the public companies that were run by GonziPN. Even the PN party is bankrupt with 13 millions in the red. Can you tell us Avukat how we are going to increase the salaries to the European standards? GonziPN is the scourge of all Maltese for the next 20 years. GonziPN has made us all poor because we have to make good for all this debt.
•
Skocciz wrong reasoning. Increase the salaries in Malta for everyone to the European level NOT reduce the pilots salaries. You should look at those who are better than you to make yourself like them not expect them to lower their standards to your level.
•
@ Carm.Gauci - I am not sure who should grow up. If Air Malta pilot salaries adopt the laws of supply and demand, their salaries would be lowered considerably as (1) Air Malta has 110 pilots to fly 10 airplanes i.e. 11 pilots to fly one plane at a cost of 100,000 euros per pilot or 1,100,000 euros per plane each year. (2) Air Malta always had extra pilots i.e. too much supply, as it sought to wet lease its planes to Sky Airline, Etihad, etc remove its huge pilot wage costs. (3) Pilots who have taken early retirement have been absorbed within the public service, kept their exorbitant salaries for pushing papers and continued to be paid from my and others taxpayers funds. If Air Malta were to go by the rules of supply and demand this will never have happened and their salaries would be reduced by half. (4) A pilot works 58 hours a month, while workers like me work 58 hours a week. These are four major issues which illustrate how there is no supply and demand in play when it comes to Air Malta pilots. Lastly I have every right to speak my mind as pilots are being paid from my taxes. If facts are not music to your ears, then that is not my problem. This is the no nonesense that Carm.Gauci is not ready to hear.
•
@Skocciz
... I presume one should also expect Maltese pilots perform up to 40% only of their European counterparts. Therefor one would get 60% less safety and 60% less efficiency.
Come on grow up! This is all about supply and demand. When the market is flooded with siutably qualified pilots, and when the of cost obtaining one's license becomes cheaper than a house mortgage, things might be different.
•
There is one major expense which should be removed. Average Maltese earn roughly 40% of salaries in Germany, Sweden, Denmark, Swizerland, etc. Only salaries of Air Malta pilots are not within this range. Lower the pilots salaries to Maltese standards. Pilots work and live in Malta so their salaries should be relatively at par with those of Maltese workers and not European workers. Instead of 10,000 euros a month they should earn 5,000 euros a month. This will save Air Malta another 6 million euros a year.
