Jazeera yields drop in 1H, but outlook remains unchanged

Kuwaiti hybrid carrier Jazeera Airways reported a half-year net profit of KD6m ($19.9m), down 3.6% year-over-year (YOY) because of overcapacity in the local marketplace. It achieved the H1 profit figure on revenue of KD24.7m, down 7.3% YOY. Net profit for 2Q was down 38.1% at KD2m as yields were squeezed, but chairman Marwan Boodai said he remained optimistic for the remainder of the year. Despite the fall in profit, Q2 had seen higher passenger numbers in both volume and load factor. Passenger numbers were up 3.2%, and load factor reached 72.4% compared to a year ago. The load factor figure was “a full 10% higher than our peers’ average load factor on the routes we operate,” Boodai said. “That’s not to say it wasn’t a challenging quarter. We saw more capacity being dumped on our routes, rising fuel costs, and an expected shift of the summer season as most of Ramadan has now moved into Q2, thus shifting revenue and travel trends and slightly impacting our earnings... Our outlook for the year remains unchanged and in line with our sector’s seasonality. While the excessive overcapacity on the sectors we operate poses a downward pressure on our yields, we expect to counter this pressure in Q3, which only had five days of Ramadan, and close the year with growth in our operational profits and our bottom line.”<br/>