Comair delivers record-breaking results

The set of results continue a 71-year streak of profits for the aviation group, which goes all the way back to its founding

Listed aviation group Comair has built on its record haul of last year by announcing a six percent increase in revenue for the six months to December, defying volatility in the notoriously difficult airline sector.

 

Despite the stagnation of the South African economy, Comair boosted its revenue to R3.3 billion, from R3.1 billion in the corresponding period last year. EBITDA increased to R604 million from R575 million, while profit after taxation was R203 million, improving by R4 million compared with last year’s R199 million.

 

Headline earnings per share and earnings per share were 43.6c, up from 42.8c.

 

The group said operating expenses increased five percent in the face of local inflationary pressure and higher fuel prices arising from a stronger oil price, which was only partially offset by the strengthening of the rand.

 

Comair operates scheduled and nonscheduled flights in SA and in the sub-Saharan and Indian Ocean island region under the low-cost brand kulula.com and under licence as British Airways. The set of results continue a 71-year streak of profits for the aviation group, which goes all the way back to its founding.

 

Financial director Kirsten King (pictured) said the results would have been even more impressive if the local economy had grown between two percent and five percent a year.  

 

“There is a lot going on currently, and the market is responding positively. However, we must aim for between two percent and five percent economic growth before we can see passenger market showing some improvement,” King said.

 

Comair chief executive Erik Venter said: “We are very pleased with the results, which have been achieved despite a volatile economy and surplus capacity which restricts occupancy levels below international standards.”

 

The group said its non-airline business continued to grow steadily, with non-airline revenue increasing by 11.6 percent and non-airline Ebitda increasing by 20 percent, resulting in an overall contribution of 13 percent to profit from operations for the group.

 

Venter said the investment in two major aspects of the company’s operations helped to offset the constraints experienced by the local airline sector.

 

“Firstly, the fleet renewal programme enables Comair’s two airline brands, kulula.com and British Airways (operated by Comair), to operate more competitively than airlines operating older, less fuel-efficient aircraft, while enhancing customers’ experience,” he said.

 

Looking ahead, Venter says the company intends to capitalize on expanded capacity of its facilities and is well-placed to prosper despite political uncertainty that continues to result in volatile economic conditions.

 

“Comair is well-placed to operate in such conditions, with strong brands, committed staff, modern, effective equipment, an efficient cost-base and strong cash reserves