In the fourth quarter of 2005, Air Malta carried almost 10,250 more passengers on its intra-European operations when compared to the same period the previous year.
However, traffic on its scheduled network to and from Malta decreased by almost 8,000 (-2.53 per cent) passengers, while charter passengers decreased by 20,000. Seat factor on its scheduled services reached 64 per cent against 67 per cent the previous year.
Overall total traffic (scheduled and charter) during the fourth quarter amounted to 371,000 – a reduction of 18,000 passengers (-4.6 per cent) over the same period the previous year. During this period, Air Malta flew 450,000 seats – an increase of 10,000 on the corresponding period the previous year.
Reviewing the performance for April-December (first three quarters of Air Malta’s financial year) the airline operated 7,405 flights representing an increase of 39 flights. These flights were operated on its entire network of scheduled and charter flights. 1.57 million passengers were flown on Air Malta’s route network.
Seat factor on its scheduled services dropped to 70 per cent from 71 per cent the previous year.
Operating revenues during the fourth quarter of 2005 reached Lm19.9 million – a drop of Lm1.0 million on the same period the previous year. Operating costs reached Lm24.5 million with operating results showing a negative Lm0.8 million worse than the same quarter in 2004. Looking at the economic performance for the period April to December, operating revenues reached Lm81.5 million a drop of
Lm2.7 million on the same period the previous year.
The operating loss was Lm2.3 million against a profit of Lm291,000 the previous year.
“These results reflect the worrying trend which is being experienced by many of the players in our industry. For the cumulative period April to December, we experienced a shortfall in revenues on the previous year of Lm2.7 million – mainly on our Malta operations.
At the same time, we improved our operating cost base by more than Lm600,000 in a situation where our fuel bill alone rose by Lm4.6 million and this after taking into account hedging income.
These cost savings have been achieved mainly as a result of a number of measures which the company has undertaken together with reductions in labour costs. I think that this shows management’s ability to rein in costs through business process reviews and other measures. On the cost front, we have been very aggressive,” commented CEO of Air Malta, Ernst Funk.
“On the revenue front, we have lost points and were it not for our intra-European operations, the results would have been worse. The revenue lost was mainly on operations to and from Malta, coupled with losses on handling operations at MIA. We are facing tough competition on all fronts and in order to face this competition, our unit revenues are diminishing.
“Other airlines have the luxury of shifting their operations to other non-Malta routes. Although we do have intra-European operations, it is significantly more difficult for us to take this course,” continued Mr Funk.
The worst months for the airline are the first quarter of the year when tourist traffic is particularly low. However, looking ahead for the year starting April , the airline believes
that it should see some improvements.
“Our focus now needs to be directed at revenue generation without losing our grip on costs. We will certainly continue with our mission to serve to the fullest extent possible the requirements of our country not only by brining in the majority of tourists but by providing alternative options and connectivity which are essential to the livelihood of our economy and our people.
“I believe that we are showing that we can compete in a very tough environment and this is thanks to the ability and skills of our management and staff who have the creative agility to act and to work hard to return this airline back to profitability,” concluded Mr Funk.