Jazeera Airways Group today announced its financial results for full year 2011, reporting a record KD10.6 million in net profit for the year with an earnings per share of 0.048 fils, a record KD57.8 million in revenue for the year, up 36% from last year, and a record KD14.9 million in operating profit for the year.
The results reflect the success of the company’s Turn-Around Plan implemented in second quarter 2010 and steered the company into continued profitability for the last six quarters, five of which had realized record-breaking earnings.
The company also announced its fourth quarter 2011 results, reporting a net profit before tax of KD1.4 million and revenues of KD13.3 million.
Established in 2005, Jazeera Airways Group is a Kuwait Stock Exchange-listed company with over 12,000 shareholders. The company has a fleet of 12 fully-owned Airbus A320s, evenly distributed between its airline business, Jazeera Airways, and its leasing-arm Sahaab Aircraft Leasing. Sahaab has assets placed with Virgin America, Sri Lanka Airlines, and Jazeera Airways.
Jazeera Airways Group Chairman Marwan Boodai said, “The year 2011 was a record-breaking year despite the continued over capacity, the impact of political unrest on travel within our network, and an increasing fuel cost. Jazeera Airways today has a solid network, increasing load factors, reduced cost, and high aircraft utilization, in addition the aircraft leasing arm has assets deployed across the globe, from the US to the Middle East to Asia. Jazeera Airways Group today has a sustainable business model that has generated sustainable profitability quarter-on-quarter for six quarters in-a-row.”
2011 in review
Speaking to investors and analysts in a webcast held today to announce FY2011 results, Boodai gave an overview of the company’s focus areas and milestones in 2011. He said, “We had three priorities in 2011. First, building on the momentum of record-breaking returns seen in Q3 and Q4 2010. Second, successfully mitigating the impact of the political unrest on the business. And third, capturing a strong market share on the Cairo-Kuwait route that was launched in May 2011.”
To secure the momentum, the company concentrated on optimizing its flight schedules to the benefit of passengers while maintaining high aircraft utilization. The company also supported its operation with continued investment in marketing, advertising, and experience-enhancing initiatives, such as increased baggage allowance for business class and changing in-flight meals on a monthly basis. While at the same time, boosting yields without cannibalizing on load factor.
The second priority was to reduce the impact of the political unrest on the business, first in Egypt then Bahrain and later in Syria. The company activated the Jazeera Airways Emergency Response Team (ERT) with round-the-clock monitoring of the each situation keeping a close eye on the developments that might impact safety of the airline’s crew, passengers, and assets at all times. To reduce the commercial impact on the business and compensate for the temporary drop in demand, capacity was redeployed by increasing flights to other cities that witnessed a surge in demand as alternative destinations. Specifically Dubai, Jeddah and Cairo .
The company’s third priority for the year was to make sure that the newly launched and long-awaited Kuwait-Cairo route was kicked off to a great start by focusing marketing activities on re-building demand in a post-revolution market. The results were very positive. Jazeera Airways secured an 11% market share in the first two weeks, 23% market share in the first 4 weeks, and maintained an 18% market share during the slow post-summer travel season.
Boodai said, “2011 was a challenging year but a record-breaking year as well for Jazeera Airways. Our priorities for 2012 are to grow load factor while maintaining high yields and we believe we will be able to achieve this goal because we have the right network with the right capacity, the right product for our market, and a tried and tested team that has successfully navigated the company through the last two years with flying colors.”
The company’s outlook for 2012 continues to be positive in-line with a growing Kuwaiti economy, which continues to witness higher incomes despite international and regional economic pressures. Boodai said, “The year 2011 witnessed varying external challenges, from multiple revolutions taking place in our network to fuel price hikes at both ends of the year, despite that 2011 was a record-breaking year for us. As the region returns to calm we look forward to the continuation of our strong performance.”