After seven years of posting losses, the Czech Republic’s national carrier Czech Airlines is likely to end in the black this year. The company is likely to post a profit of around 250 million crowns for 2015. Václav Řehoř, the head of the state run company Český Aeroholding, which holds a 20-percent stake in the Czech Airlines, confirmed the profit expectations to the business daily Hospodářské noviny on Tuesday.
Among the main reasons behind this year’s favourable outcome is a deal with the Czech Airline’s largest stakeholder Korean Airlines, which agreed to rent the company a large Airbus 330 aircraft on the route between Prague and Seoul under advantageous conditions.
Czech Airlines have also been more successful this year in selling tickets at the top end of the market for the highest possible price. In addition, the company started to charge passengers for checked-in luggage and stopped offering refreshments in the economy class for free.
The positive results should also stem from last year’s massive lay-offs. Czech Airlines released around half of its total employees and has lowered the wages of those who remaining by around 40 percent on average.
Český Aeroholding’s head Václav Řehoř told the business daily that following a year-long restructuring, Czech Airlines is finally stabilised, but he added that the situation is still very fragile.
He said the company will now attempt to improve its credibility for investors in order to receive better ratings and get loans for the development of Prague Airport.
The South Korean carrier Korea Air acquired a 44-percent stake in Czech Airlines in 2013. The Korean carrier also gained an option for a further 34-percent stake in the firm, which was transferred to the Czech charter company Travel Service in November last year, making it the Czech Airlines’ second biggest shareholder.