Royal Jordanian posts JD21 million net profit in 2015
Royal Jordanian has released its financial results for 2015. The figures show that Royal Jordanian registered a net profit before tax of JD21 million in 2015, while in 2014 it had registered JD49.5 million net losses before tax.
The net profit after tax reached JD16 million, while in 2014 the company had registered JD39.6 million in net losses.
Chairman Suleiman Hafez attributed the growth to the efficiency and loyalty of the staff, and to the company's keenness to implement the company’s business plan 2015-2019.
The plan focuses on constant renewal of the fleet and review of the route network, restructuring in all areas, taking measures to increase revenues and reduce operating costs, working to increase the company’s market share, looking for available growth opportunities, all the while improving the quality of services and maintaining the airline's leading position in the Levant.
Hafez expressed satisfaction with the company’s positive results that can be considered a quantum leap, particularly at this point in time when air transportation is strongly affected by the instability in Jordan's neighboring countries which negatively influences travel and tourism both to the kingdom and the Middle East. These positive results will help the company continue the current restructuring process.
Hafez pointed out that in the first nine months of 2015, the company registered JD27 million profits before tax. Air traffic is seasonal in nature. Normally airlines, RJ included, achieve better financial results in the second and third quarters, which witness active traffic, particularly during the summer season, whereas the first and last quarters of each year usually see a drop in the number of travellers. However, the airline achieved JD21 million at the end of 2015.
He added that the airline's policy of cost control resulted in reducing the operating cost in 2015 by 22 per cent, mentioning that operating costs amounted to JD715 million in 2014, against JD559 million in 2015.
The chairman said that the fall in fuel prices last year partially offset the drop in revenues; that was due to lower ticket prices imposed by fierce competition in the sector. The lower fuel prices also helped offset some of the JD12.3 million losses incurred due to suspending destinations like Sana’a and Aden for security reasons.
Hafez also said that the operating efficiency had a role in reaching these positive results. RJ shut down a number of stations in light of its weak economic feasibility and, consequently, reduced the number of its aircraft.
The stations are Delhi, Mumbai, Colombo, Lagos, Accra, Milan, Alexandria and Al-Ain.
Hafez added that last year, the company increased the frequency of flights to certain destinations in response to the greater demand for travel, particularly in the peak seasons.