State-owned South African Airways (SAA) said on Wednesday its full-year revenue rose 9% to R22,5-billion, but rising fuel costs posed a threat to its profitability goals.
The airline posted a net profit of R123-million for the year to end-March, which excluded restructuring costs of R1,34-billion. It said it had achieved a R2-billion turnaround for the 2007/08 financial year.
”It’s an excellent achievement, but we still have some way to go to ensure that SAA is sustainably profitable by March 2009, particularly in light of the relentless rise in the oil price,” the company said in a statement.
”Depending on the oil price, SAA nevertheless remains confident that the airline will achieve profitability in 2008/09,” it said.
The group said its operating costs had increased to R23,6-billion rand, with the main contributor being the R6,68-billion energy bill. It said more than R1-billion in costs had been taken out of the business.
SAA announced a restructuring plan in June last year in an effort to return to profitability within 18 months. It said the programme would remain its key focus for the current financial year.
The airline warned that rising oil prices were a huge challenge and added it was talking to the South African government to have the airline recapitalised. – Reuters