Business

Comair earnings down

Staff Reporter

Regional and local airline Comair said on Wednesday that its earnings were 43% down on the previous year, at R62-million.

Regional and local airline Comair said on Wednesday that its earnings were 43% down on the previous year, at R62-million.

The was during the release of its annual results for the year ended June 30 2008.

Earnings, the company said, had been affected by the record-high oil price during the year, which increased the company’s fuel bill by R380-million.

Comair’s two brands, British Airways and kulula.com, grew both volumes and yield, and resulted in Comair revenue growth of 21% to R2,7-billion.

“The trading environment during the second half of the financial year was brutal and the toughest in the history of the industry,” said Comair joint chief executive Erik Venter.

He said it was a “huge credit” to his team of 1 781 employees that Comair remained “the only profitable airline in South Africa and one of the few in the world”.

He said cash generation remained strong and allowed significant investment in the company’s new Boeing aircraft, which delivered fuel savings of 26% per seat over the old MD82s.

New aircraft were not the only area in which the company intended building greater efficiency.

“Even though we’ve recently seen some respite from the oil price, we are planning our business around permanently high energy costs,” Venter said.

“Our team was tasked to identify further efficiency opportunities in the business and came back with more than R100-million per annum in additional savings.”

The company’s growth plan also proceeded well during the year, with ancillary profits from the company’s travel business, flight-training facilities and ground-handling operations contributing more than a quarter of its total profits.

On the issue of growth, Venter said that Comair would continue to grow its non-airline businesses and was seeing more opportunities to grow within Africa.—Sapa

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