Kuwait's Jazeera Air Swings To A Profit In 2011 Amid Ongoing Restructuring

Wednesday, Mar 07, 2012

(This story was originally published Tuesday.)

DOHA (Zawya Dow Jones)--Kuwait's Jazeera Airways, which announced a major restructuring in 2010, swung to a profit in 2011 as it flew 1.2 million passengers and seat load factors increased.

The airline, that flies to 18 destinations and runs a fleet of 12 Airbus A320s, posted full year net profit of 10.6 million Kuwaiti dinars ($38 million) compared to a net loss in 2010 of KWD2.8 million, it said in a statement Tuesday.

Established in 2005, Jazeera started a restructuring process in 2010 after posting a loss due to increased competition at home. Its so-called Turn-Around Plan redeployed assets and cut staff.

Fourth quarter net profit fell to KWD1.3 million, down from KWD2 million in the year earlier period due to foreign exchange gains in 2010, chairman Marwan Boodai told Zawya Dow Jones in a phone interview. Full year revenues climbed 36% to KWD57.8 million

The airline's costs are in U.S. dollars yet receivables, like fares, are priced in Kuwaiti dinars.

Jazeera Airways doesn't hedge fuel costs, Boodai said. Its fuel budget was $125 million in 2011, compared to $91 million in 2010.

2011 had been challenging year with unrest across the Middle East and high fuel prices, it said.

-By Alex Delmar-Morgan, Dow Jones Newswires; +974 6659 9818; alex.delmar-morgan@dowjones.com

(END) Dow Jones Newswires

07-03-12 0402GMT