Down and then up! Bahrain’s Gulf Air cuts losses by 30%, increases revenue by 10%
Bahrain’s national airline Gulf Air claims it has cut year-on-year losses by nearly a third and increased overall revenue by 10 percent in the first half this year.
However, the airline declined to provide figures, said a report in the Gulf Daily News (GDN), our sister publication.
The growth was due to increased revenues, a statement by the airline said.
Transportation Minister and chairman of Gulf Air's board executive committee Kamal Ahmed said the first half saw Gulf Air strengthen its Middle East and North Africa (Mena) operations while maintaining strategic links to select points in Europe, the Far East, India and Pakistan.
“The initial benefits from the strategic restructuring were evident in last year's results and these have translated into significant loss reduction and revenue generation during the first half,” Gulf Air acting chief executive Maher Al Musallam said.
“Encouraging summer season bookings confirm the positive trend.
“Our investment in strengthening the network with the addition of new international destinations occurred within a rising demand environment that also saw us substantially increase our available capacity thanks to schedule enhancements to key routes.”
The chief executive said the airline's target for the year is to continue towards long-term sustainability, further cutting losses.
“This will be achieved through further reduction in operational costs, increasing sales efficiency and focus on customer needs.”
In May, the airline had said from January to December last year it cut losses by more than BD100 million ($265 million) or 52 percent, netting year-on-year cost savings of 28 per cent and 14 percent passenger yield increase.
The year-on-year reduction in losses was achieved mainly through reductions in aircraft leasing fees, retiring of aircraft, closure of eight loss-making routes, opening of five new destinations, increasing frequencies to eight existing destinations, reduction in staff expenses, renegotiation of more than 2,000 supplier contracts and productivity improvements.
Officials had pledged then that no more job cuts will be made at Bahrain's national carrier after more than a quarter of its staff faced the axe last year.
The restructuring scheme included a 27.2 percent reduction in manpower last year with 1,024 employees leaving the airline.
Expatriate employees made up 60 percent of those made redundant and of the 429 Bahrainis who left the airline, 381 opted for a voluntary retirement scheme.
This means the airline had 2,742 employees on its payroll as of December 31 last year.