Almost clinically dead, but back from the grave. That’s how some describe the turnaround of airline ČSA on reports of its best financial results for the last 10 years with an operating profit approaching 250 million crowns.
Latest figures reported by the business daily E15, say the airline made an operating profit of 250 million crowns in 2015, turning around a loss of almost 600 million from a year earlier.
But the turnaround has come with a drastic slim down of the carrier, which at its peak in the last decade boasted a fleet of around 50 aircraft. Now the fleet is trimmed to 16 planes, which has brought the slightly disrespectful tag of Aeroclub for the airline. The airline had 23 planes in service in 2014.
The dramatic restructuring has had an impact on turnover. This slipped to around 8.0 billion crowns last year, down around 15 percent compared with a year earlier. And the number of passengers also decreased by around 300,000 to 2.0 million last year.
But the basic fact is that there are more bums on seats in ČSA aircraft now, the load factor has jumped to an average 72 percent, up five percentage points, and those passengers travelling are making a bigger contribution to the bottom line [excuse the pub]. The carrier is also getting much more airtime out of its reduced fleet than before.
Other factors have also contributed to the turnaround from the recent days when ČSA appeared to be staring bankruptcy in the face. Lower oil and as a result aviation fuel prices are a big bonus in spite of the fact that the bills have to be paid for with more expensive US dollars. Savings on fuel costs represented around 270 million crowns last year. The carrier also cashed in on the sale of one of its former Boeings but fresh expenses also resulted in new reserves created for repairs and maintenance and ongoing restructuring costs.
Analysts say the recovery of ČSA is clear to see but that it is still very fragile and that cash reserves of around 1.0 billion crowns should be built up in the good times to provide a cushion for when the commercial skies are a lot more cloudy.
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