Aegean Airlines, the Greek airline that has been short-listed to buy the government’s majority stake in Cyprus Airways, saw its first half after-tax earnings more than double from €6.9 mln in 2013 to €16 mln this year, while group consolidated revenue increased by 8% to €388.6 mln.
The airline said its improved financials resulted from the network expansion and from cost synergies with Olympic Air, even though due to seasonality the first half is traditionally the weakest semester in performance.
Star Alliance partner Αegean and Olympic Air carried 4.3 mln passengers in the first half of 2014, 16% more than the previous year, achieving a further improvement on load factor to 76% from 74%, despite the high number of new destinations launched during the period.
In June, the company reached a historic milestone by exceeding 1 mln monthly passengers for the first time. Traffic in the domestic network increased by 19%, driven mainly by lower fares which boosted demand for main markets as well as smaller island destinations. International traffic out of the eight hubs rose by 13%, with Athens registering a higher growth rate of 17%, as the market recovered for the first time since 2008.
As a result of higher demand and improved pre-sales, operating cashflow showed a remarkable improvement to €127 mln for the first half, driving cash and cash equivalents for the parent company to €357 mln as at the end of June. Strong cash flows facilitated, in line with expectations, the smooth distribution of a €1 per share dividend (€71 mln in total) in July, with the company maintaining significantly higher cash reserves than in 31/12/2013 and therefore the ability to comfortably support its gradual growth plans.
“Our expanded operations for 2014 with a fleet of 50 aircraft, 13 mln available seats to be offered for the whole year and 17 new international destinations, are yielding positive results,” said Aegean’s Managing Director, Dimitris Gerogiannis.
“Olympic Air synergies are gradually maturing bringing unit cost improvements and increased flows from connectivity. Our investment in incoming leisure and tourism over the last five years, is now bringing tangible results for Aegean. And this despite the significant rise in competitive capacity to our market, as well as challenges linked to Russia and Ukraine. We are benefiting from economies of scale and network development and we will continue to gradually pursue this strategy while making new investments in quality and competitiveness, as with our decision to take delivery of seven brand new Airbus A320s in 2015-2016.”
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