|28 October, 2019

Royal Jordanian 9-month net profit up 139% to $34.4mln

The gross profit recorded by the company in the first nine months of this year increased by 28%

Royal Jordanian aircraft tails.

Royal Jordanian aircraft tails.

Royal Jordanian/Handout via Thomson Reuters Zawya

Royal Jordanian, the flag carrier of the kingdom, has posted a net profit of JD24.4 million ($34.4 million) first nine months of 2019 compared to JD10.2 million for the comparison period of 2018, or a 139 per cent increase.

The operating revenues for the same period also went up, from JD510 million in 2018 to JD514 million this year, a1 per cent increase, while the operating cost decreased by 4 per cent, from JD430 million in the first nine months of 2018 to JD412 million in the same period this year.

As a result, the gross profit recorded by the company in the first nine months of this year increased by 28 per cent, from JD80 million in 2018 to JD102 million this year.

RJ president and CEO Stefan Pichler said: “The company has continued to post positive financial and operational results in 2019 due to the turnaround plan, launched in the last quarter of 2017, which we are implementing and which aims at enhancing RJ’s financial and operational performance, as well as raising the standard of services we offer our guests.

“All is done following a clear plan supported by the Board of Directors, a plan that set the ambitious goal of enhancing RJ’s presence and competitiveness regionally and globally, and strengthening its strategic role as the national carrier and a bridge connecting Jordan and the Levant with the world.”

Pichler added that RJ posted a net profit of JD1.5 million in the first half of 2019 and, as the trend shows, continues to register profits; it registered a net profit of JD22.9 million after tax in the third quarter of this year, bringing the net profit for the first nine months of 2019to JD24.4 million.

Pichler said that RJ is still working to push its staff's productivity and improve the company’s operational KPIs.

The airline had a 74 per cent seat load factor for the first nine months of 2019, and fleet utilization grew from 12.2 to 12.6 hours per day, a 3 per cent increase. On time performance increased by 2 per cent from 76.4 per cent to 77.8 per cent in the comparison period.

He noted that various performance indicators also improved in the same period: revenues RJ obtained from the Royal Club frequent flyer program increased by 61 per cent, ancillary revenues grew by 13 per cent, revenues from online sales increased by 2 per cent, cargo warehouse revenues by 2 per cent, and revenues from RJ’s subsidiary Tikram for airport services by 18 per cent.

The fuel bill paid by RJ decreased by 8 per cent, which contributed to achieving positive financial results in the first nine months of the year.

“RJ is on the right path toward the profitability the company and its stakeholders are aiming at. The positive financial results for the first nine months of 2019 ensure that the airline will register satisfactory results by the end of this year; however, they will not be that substantial, due to travel seasonality and lower passenger numbers during the fourth quarter of the year, which is the case for the majority of global airlines and the air transport industry in general,” Pichler concluded. – TradeArabia News Service

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