Aegean boosts H1 prof­its to € 16m, 4.3m pas­sen­gers

Financial Mirror (Cyprus) - - FRONT PAGE -

Aegean Air­lines, the Greek air­line that has been short-listed to buy the gov­ern­ment’s majority stake in Cyprus Air­ways, saw its first half after-tax earn­ings more than dou­ble from ?6.9 mln in 2013 to ?16 mln this year, while group con­sol­i­dated rev­enue in­creased by 8% to ?388.6 mln.

The air­line said its im­proved fi­nan­cials re­sulted from the net­work ex­pan­sion and from cost syn­er­gies with Olympic Air, even though due to sea­son­al­ity the first half is tra­di­tion­ally the weak­est se­mes­ter in per­for­mance.

Star Al­liance part­ner egean and Olympic Air car­ried 4.3 mln pas­sen­gers in the first half of 2014, 16% more than the pre­vi­ous year, achiev­ing a fur­ther im­prove­ment on load fac­tor to 76% from 74%, de­spite the high num­ber of new des­ti­na­tions launched dur­ing the pe­riod.

In June, the company reached a his­toric mile­stone by ex­ceed­ing 1 mln monthly pas­sen­gers for the first time. Traf­fic in the do­mes­tic net­work in­creased by 19%, driven mainly by lower fares which boosted de­mand for main mar­kets as well as smaller is­land des­ti­na­tions. In­ter­na­tional traf­fic out of the eight hubs rose by 13%, with Athens reg­is­ter­ing a higher growth rate of 17%, as the mar­ket re­cov­ered for the first time since 2008.

As a re­sult of higher de­mand and im­proved pre-sales, op­er­at­ing cash­flow showed a re­mark­able im­prove­ment to ?127 mln for the first half, driv­ing cash and cash equiv­a­lents for the par­ent company to ?357 mln as at the end of June. Strong cash flows fa­cil­i­tated, in line with ex­pec­ta­tions, the smooth dis­tri­bu­tion of a ?1 per share div­i­dend (?71 mln in to­tal) in July, with the company main­tain­ing sig­nif­i­cantly higher cash re­serves than in 31/12/2013 and there­fore the abil­ity to com­fort­ably support its grad­ual growth plans.

“Our ex­panded op­er­a­tions for 2014 with a fleet of 50 air­craft, 13 mln avail­able seats to be of­fered for the whole year and 17 new in­ter­na­tional des­ti­na­tions, are yield­ing pos­i­tive re­sults,” said Aegean’s Man­ag­ing Di­rec­tor, Dim­itris Gero­gian­nis.

?Olympic Air syn­er­gies are grad­u­ally ma­tur­ing bring­ing unit cost im­prove­ments and in­creased flows from con­nec­tiv­ity. Our in­vest­ment in in­com­ing leisure and tourism over the last five years, is now bring­ing tan­gi­ble re­sults for Aegean. And this de­spite the sig­nif­i­cant rise in com­pet­i­tive ca­pac­ity to our mar­ket, as well as chal­lenges linked to Rus­sia and Ukraine. We are ben­e­fit­ing from economies of scale and net­work de­vel­op­ment and we will con­tinue to grad­u­ally pur­sue this strat­egy while mak­ing new in­vest­ments in qual­ity and com­pet­i­tive­ness, as with our decision to take de­liv­ery of seven brand new Air­bus A320s in 2015-2016.”

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