Johannesburg - Wednesday 17 September 2008. Comair Limited (Comair) today posted its annual results for the year ended 30 June 2008 and maintained the company’s unbroken record of 63 years of operating profits. Earnings, which were 43% down on the previous year at R62 million, were impacted by the record-high oil price during the year which increased the company’s fuel bill by R380 million.
Comair’s two brands British Airways and kulula.com, leaders in their market segments, grew both volumes and yield, and resulted in Comair revenue growth of 21% to R2,7 billion.
Comair joint CEO Erik Venter summed the year up as follows, “The trading environment during the second half of the financial year was brutal and the toughest in the history of the industry. It’s a huge credit to our team of 1,781 incredible people that we remain the only profitable airline in South Africa and one of the few in the world.”
Cash generation remained strong and allowed significant investment in the company’s new Boeing aircraft, which deliver fuel savings of 26% per seat over the old MD82s. New aircraft are not the only area the company intends building greater efficiency. Venter continued, “Even though we’ve recently seen some respite from the oil price, we are planning our business around permanently high energy costs. Our team were tasked to identify further efficiency opportunities in the business and came back with over R100 million per annum in additional savings.”
The company’s growth plan also proceeded well during the year with ancillary profits from the company’s travel business, flight training facilities and ground handling operations contributing more than a quarter of its total profits. On the issue of growth Venter commented, “We’ll continue to grow our non-airline businesses and are seeing more opportunities to use our skills base and infrastructure to grow within Africa.”
Additional note on brand performances:
British Airways brand
The British Airways brand continued to lead in the premium segment of the Southern African market. British Airways achieved a 78% score on its key metric of ‘overall satisfaction with British Airways’ in the monthly customer survey compared to 73% last year. Comair’s British Airways product also performed exceptionally well against other British Airways short-haul services from around the world.
During the year the Club (business class) product was upgraded, including a revamp of the meal service. The new high-quality meals have been very well accepted and allowed Comair to grow its share of the business market.
The key metric ‘satisfaction with kulula experience’ a score of 92% was achieved in the first full year of the survey. kulula did not achieve its on-time performance target during the year due to delays in the new fleet acquisition during the year. On baggage delivery kulula achieved a baggage loss/damage rate of less than 1 bag per 5,000 carried.
kulula continued to grow its successful kulula services out of Lanseria airport, where the ease and convenience of the experience has been very well accepted by business and leisure travellers. kulula also launched an innovative travel reward program called ‘jetsetters’ during the year and signed up over 50,000 members within one month.