Royal Jordanian Airlines sees 272% increase in net profits this year
Royal Jordanian registered net profits before tax of JD27 million in the first nine months of this year, against JD15.7 million net loss during the same period in 2014, marking an increase of 272%.
The net profit after tax for the first nine months of 2015 reached JD21.4 million – an increase of 236% over the corresponding period of last year.
RJ’s Chairman of the board of directors Suleiman Hafez expressed satisfaction with the company’s positive results that are a quantum leap in its journey in the current period, since air transportation is still affected by the instability in the neighboring countries which negatively influences travel and tourism to Jordan and the Middle East. These results will help the company continue the current restructuring process.
He attributed the noticeable growth in the financial results to the efficiency and loyalty of the staff and its keenness to implement the board’s vision and the 5-year strategic plan since the beginning of the year. The strategy focuses on restructuring in all areas, increasing revenues and reducing the operating cost, while improving the quality of services and maintaining RJ’s leading position among the airlines in the Levant .RJ has been the national carrier of Jordan for the last 52 years.
Hafez pointed out that air traffic is seasonal in nature. Normally airlines, including RJ, achieve better financial results in the second quarter and the third which sees an active traffic during the summer season, whereas the first and last quarters of each year see a drop in the number of travelers. Thus, the gains are earned in the peak seasons and holidays.
He said that the cost-control policy of the airline resulted in reducing the operating cost in the first nine months of this year by 22% compared to the same period of last year. He mentioned that operating costs amounted to JD434 million against JD519 million revenues last year, achieving a JD85 million gross profit with a rise of 95% over the corresponding period of last year.
In this regard, the chairman mentioned that the fall in fuel prices this year contributed to a drop in expenses, while there was a key role to the operational efficiency being featured by closing a number of the network’s stations due to their weak feasibility and reducing the number of aircraft accordingly.
He also pointed out that RJ shut down a number of its stations at the end of last year; they are Delhi, Mumbai, Colombo, Lagos, Accra, Milan, Alexandria and Al-Ain. The airline also opened new markets in the region -Tabuk and Najaf. Additionally, RJ reduced the number of its aircraft in sync with the needs of the route network, which is continuously being assessed, in line with the airline’s strategies.
Hafez added that the company increased the frequency of flights to certain destinations in response to the greater demand on travel particularly in the peak seasons. For instance, the flights to Aqaba increased from 11 to 16 weekly, with changes to the schedule of flights to meet passengers’ needs.
He added that RJ will open new destinations worldwide before the end of this year.