- As projected in last year's AGM, loss for year ending March 2015 confirmed at €16 million

- This year's Air Malta projected loss reduced to €4 million: Down from €16 million in 2015 and from €78 million when the airline entered the restructuring plan in 2012

- Focus shifts to competitiveness: growth, workers productivity and strategic alliance 

Air Malta's results for the first half of the current financial year show the airline is on track to regaining profitability, with the company projecting a loss of just €4 million by March 2016.

This was announced during Air Malta's Annual General Meeting last week reporting the audited financials for the year ending March 2015, which, as projected, showed a loss of €16.4 million. 

Air Malta's audited financials presented at the AGM for the year ending March 2015, showed a loss of €16.4 million. 

The results of Financial Year ending March 2015 were also achieved thanks to the renegotiation of the catering contract, which gave savings of more than €4 million annually, and the sale of Selmun Palace Hotel. 

Air Malta's results for the first half of the current financial year show the airline is on track to regaining profitability, with the airline projecting a loss of just €4 million by March 2016.

Passenger and revenue figures for July 2015 were even higher than they were in July 2013 which had included substantial numbers from Libya.

Malta's national airline agreed on a restructuring plan with the EU when it was making a loss of €78 million, which demonstrates how far the company has come in a few short years since 2012.

Chairperson Maria Micallef said, "Last year we reported that Air Malta had successfully cut its losses from €31 million to €17 million for the year ending March 2014."

During the same AGM we had also forecast that losses would have still been at the €16 million mark for the year ending March 2015. This despite, the closure of the Libya route and the drop in the number of passengers from Russia, which contributed to a loss of circa €10 million, increased competition in summer 2014 and an airline with a virtually depleted management structure.

Today I can confirm that - in line with our projections - we have been able to maintain last year's result. In fact, as our figures will reveal for the year ending March 2015, the company has kept the annual loss down at €16 million. This was achieved by means of two main initiatives: The sale of Selmun Palace Hotel Company Ltd and the renegotiation of the Sky Gourmet contract which were both successfully concluded, albeit some years later than they were meant to, according to the original restructuring plan.

The renegotiation with Sky Gourmet gave us savings of more than €4 million per year. It also took us from an expensive system without adequate controls, to a system of accountability.

We renegotiated the IT contract and we divested of our insurance arms, Shield and Osprey.

We can now safely say we have done practically everything we could do to bring our costs down to a competitive minimum: catering (for an annual saving of €4 million), renegotiation of the IT and telecoms contract (for an annual saving of €1.25 million) and Aircraft Fleet Rationalisation and Renewal (for an annual saving of €9 million).

We are now, finally, starting to reap the benefits of having the right contracts in place.

Today, we will reveal the numbers for the first six months of this financial year, covering the period from April 2015 to September 2015.

The results are encouragingly positive.

For the first time in a number of years we have started regaining our market share, despite intensive competition and significant additional seat capacity on established routes bound to adversely affect the airline.

Our passenger and revenue figures for July 2015 were even higher than they were in July 2013 which had included substantial numbers from Libya.  This is also despite the marked decrease in numbers from the Russian market as a consequence of the economic downturn in Russia and ever-growing competition.

In fact, results for the first six months of the current financial year confirm that the company is €8.7 million better off, from a profitability point of view, when compared to first six months of last year.

If these positive trends continue - and if we do not experience any major setbacks such as natural disasters or industrial action in the next six months - we will exit the restructuring programme period with a loss of around €4 million for the year ending March 2016, taking into consideration that the slower winter months are now approaching.

These positive results for the airline should continue and should improve even more aggressively during this financial year.

Air Malta had been losing substantial amounts of money since 2003, before finally entering the RP in 2012. It began the RP process with a staggering €78 million loss five years ago. But thanks to the hard work everyone has put in we are going to be close to break even in 2016.

This achievement is surely very positive.

However, like all other small airlines, we are still vulnerable. And this vulnerability will stay with us past March 2016.

To overcome the hurdles and make this airline competitive, we must now start to tackle productivity and growth.

Every expert we speak to is adamant: our workforce productivity in certain sectors must increase by at least 25%, if we are to grow to be competitive against other airlines.

This will not be easy, but it is not impossible.

Our airline has its own peculiarities. Our traffic reduces substantially in winter. We therefore need flexibility. We cannot employ people all year round and deploy some of them only in the summer months.

Here I must pay tribute to our late Chairman, Albert Mizzi, who practically started Air Malta, but unfortunately did not live to see the day this airline regained profitability - a dream I know he shared as passionately as all of us.

I would like to address one final consideration: despite breaking even, Air Malta will always have an economies of scale disadvantage.

No matter how much we address our costs, we shall never be able to negotiate with the same clout of airlines that have fleets of hundreds of aircraft. We will not be able to negotiate the same costs for fuel, for maintenance, for IT systems and for everything else.

And, in an industry driven first and foremost by cost and pricing, this means we shall never be able to compete effectively.

A strategic alliance could change all this. Air Malta has the potential to become part of a wider network with the clout to command prices. Such an alliance, would feed our network and ensure the much-required increase in passengers and revenue.

It may seem counter-intuitive that in the same breath we are reducing our fleet to eight aircraft. In fact, we always underlined that this is a short-term measure that arose from an opportune chance to review our lease agreements. In the short term, this decision will help us save money when we need it most, while still being able to carry the same number of passengers by boosting the utilisation of our aircraft.

However, the strategic vision is ultimately to grow beyond eight aircraft. Once we are past the restructuring era, we must step solidly into this strategic mode.

During the last six months of the Restructuring Plan, let us all show how much we care about this airline. Let us all show that we understand how important the airline is for Malta.

As a national airline, Air Malta remains the most important airline for the Maltese islands both in strategic and in volume terms, and this brings about a number of challenges.