The FINANCIAL — Royal Jordanian Board of directors approved the financial results of the first quarter of this year in its session held on April 30, 2009, headed by Nasser Lozi, chairman of the board.
The results showed 11% decrease in revenues in comparison to the same period in 2008, due to a decline in the number of passengers and uplifted cargo on board RJ aircraft.
RJ president/CEO Samer Majali said that the decrease in passenger and freight transportation is a result of the global economic crisis, whose outcome negatively affected various economic sectors and the performance of the companies and breakdown of many, in addition to increasing the unemployment in many countries. All this resulted in decreasing spending, particularly on travel.
He added that the events in the Gaza Strip at the beginning of this year also negatively affected RJ results in January 2009, reflecting on all the situations in the region. It caused cancellation of tourist bookings, especially the groups coming from the western countries.
Yield per passenger also declined by 5% in the first quarter of 2009, compared to the same period of last year, as a result of the decrease in the demand on travel and the sharp competition the airline is facing with the full-service and the low-cost carriers.
According to Royal Jordanian, the revenues of the company reached to JD124 million in the first quarter of the year, compared to JD138 million achieved in the comparison period in 2008. The net loss amounted to JD8.5 million against JD4.4 million in the comparison period.
Majali pointed out that RJ aircraft carried 491,000 passengers compared to 553,000 passengers carried in the first quarter of last year. Thus, the seat factor went down to 62% compared to 68% last year. The uplifted cargo also decreased by 32% due to the above mentioned reasons.
He said that all the conditions that affected the airline in this particular period coincided with a downturn in demand for travel that RJ witnesses on its destinations in the first quarter of every year.
Majali expressed optimism that RJ will compensate the results in the second and third quarters of this year, which see growth in bookings on all sectors, particularly in the summer months. The company has been diligent to register record passenger numbers in the summer season during the last five years.
Majali stressed that the oneworld airline member, RJ, is continuing its strategic plans for this year, after it completed its short- and medium-range fleet modernization in March this year; accordingly it introduced 19 modern aircraft. Additionally, the company resumed its operations to Brussels at the beginning of last April, and will open a new service to Benghazi in June this year.
In the first quarter of the year, the airline attained several achievements, among which is awarding RJ the IATA Safety Audit for Ground Operations (ISAGO) certification, upgrading RJ In-flight Services’ ISO 9001 certification, implementing Cargospot, the new cargo IT platform. Moreover, RJ was awarded the Air Cargo Award of Excellence in the Air Carrier category for achieving a superior overall rating from the readers of Chicago-based Air Cargo World magazine.
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