Category Archives: El Al Israel Airlines

El Al reports a record third quarter net profit

El Al Israel Airlines Boeing 777-258 ER 4X-ECC (msn 30833) LHR (SPA). Image: 930028.

El Al Israel Airlines (Tel Aviv) reported a record third quarter net profit of $936 million, up from a net profit of only $10.1 million in the same quarter a year ago. The change was a direct result of lower fuel costs.

Read the full report: CLICK HERE

Copyright Photo: SPA/AirlinersGallery.com. Boeing 777-258 ER 4X-ECC (msn 30833) arrives in London at Heathrow Airport.

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El Al finalizes its order for up to nine Boeing 787 Dreamliners

Boeing (Chicago, Seattle and Charleston) and El Al Israel Airlines (Tel Aviv) agreed on an order today for up to nine 787 Dreamliners, valued at more than $2.2 billion at current list prices. Three of the orders will be added to Boeing’s Orders & Deliveries website on November 5 and the remainder will be posted as further contractual requirements are finalized.

El Al will also lease six additional 787s from independent leasing companies as the Israeli-flag carrier looks to replace and grow its existing long-haul fleet, increasing capacity and providing greater route flexibility to and from its hub at Ben Gurion Airport, Tel Aviv.

El Al logo (LRW)

El Al has been an all-Boeing carrier since taking delivery of its first Boeing airplane in 1961 and currently operates a fleet of 22 737s, seven 747s, seven 767s and six 777s.

Image: Boeing.

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El Al to order and lease up to 15 Boeing 787 Dreamliners

El Al Israel Airlines (Tel Aviv) intends to become a new Boeing 787 operator.

El Al logo (LRW)

Boeing has issued this statement:

Boeing logo (medium)

Boeing is pleased that El Al Israel Airlines has announced its intent to purchase and lease up to 15 787 Dreamliners, with purchase rights for 13 additional airplanes. When finalized, the order will be posted to the Boeing Orders & Deliveries website.

Copyright Photo: Brandon Farris/AirlinersGallery.com.

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Boeing delivers the 50th airplane to El Al Israel Airlines

El Al Israel Airlines (Tel Aviv) and Boeing (Chicago, Seattle and Charleston) today (March 12) celebrated a major milestone  with the delivery of the airline’s 50th airplane purchased from Boeing – a Next-Generation 737-900 ER.

Boeing 737-958 ER 4X-EHD (msn 41555) was officially handed over yesterday (March 11).

The delivery is the fifth 737-900 ER for the airline following an order placed for eight between 2011 and 2013. Since taking delivery in 1961 of its first new Boeing airplane, a 707-420, EL AL’s fleet has expanded to include an all-Boeing fleet consisting of 21 737s, seven 747s, six 767s and six 777s.

Copyright Photo: Ton Jochems/AirlinersGallery.com. The first, Boeing 737-958 ER 4X-EHA (msn 41552), is seen at Amsterdam.

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El Al to start nonstop Boston flights on June 28

El Al Israel Airlines (Tel Aviv) will introduce nonstop Tel Aviv – Boston service on June 28. The route will be operated three days a week with Boeing 767-300 ER aircraft.

Copyright Photo: Paul Denton/AirlinersGallery.com. Boeing 767-3Q8 ER 4X-EAK (msn 27600) departs from Geneva.

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American Airlines and El Al expand their codeshare relationship

American Airlines (Dallas/Fort Worth) is expanding its codeshare relationship with El Al Israel Airlines (Tel Aviv). According to Airline Route, American on December 18 added its AA code on the following El Al European routes:

Tel Aviv – Amsterdam
Tel Aviv – Barcelona
Tel Aviv – Frankfurt
Tel Aviv – London (Heathrow)
Tel Aviv – Milan (Malpensa)
Tel Aviv – Munich
Tel Aviv – Paris (CDG)
Tel Aviv – Rome (Fiumicino)

Copyright Photo: Ton Jochems/AirlinersGallery.com. Boeing 737-958 ER WL 4X-EHA (msn 41552) of El Al taxies at Amsterdam.

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El Al’s third quarter net profit slips to only $10.1 million

El Al Israel Airlines (Tel Aviv) reported a third quarter net profit of $10.1 million, down from a net profit of $57.9 million in the same quarter a year ago. Net loss during the period of the first nine months of 2014 amounted to $13.2 million compared to a profit of $29.1 million dollars during the equivalent period in the previous year.

El Al’s CEO, David Maimon: “The results of the third quarter reflect the effect of the “Operation Protective Edge”, which caused significant harm to revenues and as a result El Al requested government assistance. This is the first time since the Second Lebanon War in 2006 in which El Al presents a significant decline in third quarter profits which is traditionally considered as its strongest quarter. In addition, the quarter was characterized by an erosion in prices which resulted in a decline in revenues per passenger.”

Maimon added: “On the other hand, we have significant marketing achievements: the number of members of the Frequent Flyers Club in Israel and globally increased to 1.4 million members, inter alia thanks to the launching of the Flycard and Flycard Premium credit cards with 40 thousand customers ordering these cards within a few weeks. In addition, in the framework of the renewal and extension of the Company’s network of destinations, in the fourth quarter we announced the opening of a new El Al direct line to Boston and a new cooperative agreement (codeshare) signed with JetBlue Airways and American Airlines, which enables our customers to fly to a wide range of destinations in the US with high availability and convenient connections.”

The results of the third quarter of 2014:

Revenues amounted to $601.2 million dollars, compared to $643.3 million during the equivalent quarter in the previous year, a decline of 6.5%. Revenues per passenger declined by 7.3%, mainly as a result of a drop in the yield per passenger-kms, as a result of the negative effects of the ‘Operation Protective Edge’. Revenues from cargo transport increased by 4.5%, mainly as a result of an increase in the number of ton-kms flown, after setting off a decline in the yield.

Operating expenses increased by 2% to $493 million compared to $483.6 million during the equivalent quarter in the previous year. The rate of operating expenses to turnover increased from 75.2% in the third quarter of 2013 to 82.0% in this quarter. The increase in operating expenses was a result mainly of the increase in expenses for jet fuel, an increase in levies and air transition fees, and after setting-off the decline in salary and security expenses.

Salary expenses declined during the quarter, mainly due to the effect of the devaluation in the rate of the shekel compared to the dollar on the Company’s liabilities for employee benefits. The number of the Company’s employees, permanent and temporary, stood at an average of 6,216 employees, compared to 6,109 during the equivalent quarter in the previous year.

The Company’s expenses for jet fuel increased by 5.2%. The increase was due to the effect of the increase in operations and the effect of the increase in the effective price of jet fuel (which includes the results of hedging operations that the Company took). It should be mentioned that the prices of jet fuel in the market declined in the third quarter compared to the equivalent quarter in the previous year, but the Company’s hedging operations resulted in an increase in the effective price for the Company. The rate of jet fuel expenses to turnover increased from 30.3% during the equivalent quarter in the previous year to 34.1% in the third quarter. Total hedging payments in the quarter under report agregated 2.9 million dollars compared to $4.4 million receipts from hedging for the equivalent quarter in the previous year. In addition, the Company recorded expenses of $5.8 million as a result of changes in the fair value of the hedging transactions, which are not recognized as hedging (revenues of 2.4 million dollars during the equivalent quarter in the previous year).

Gross profits amounted to $108.3 million (18.0% of turnover), compared to $159.7 million for the equivalent quarter in the previous year (24.8% of turnover).

Income from operations amounted to $29.1 million, compared to $75.6 million during the equivalent quarter in the previous year.

Net financing expenses during the quarter amounted to $15.4 million compared to net financing income of $5.2 million during the equivalent quarter in the previous year, mainly due to the results of hedging the rates of exchange.

Net profit for the third quarter of 2014 amounted to $10.1 million, compared to $57.9 million for the third quarter of 2013.

Cash flows used for operating activities in the third quarter of 2014 amounted to $12.0 million compared to $56.1 million cash flows provided by operating activities during the equivalent quarter in the previous year.

The EBITDA in the third quarter of 2014 amounted to $57.3 million compared to $100.6 million during the equivalent quarter.

Results for the first nine months of 2014:

Revenues for the first nine months of the year amounted to $1,588.2 million, compared to $1,604.0 million during the equivalent period in the previous year, a decline of 1.0% due mainly to the decline in yield as a result of the increasing competition and after setting off the increase in the number of passengers flown.

Operating expenses during the first nine months of 2014 amounted to $1,357.7 million compared to $1,324.4 million during equivalent period in the previous year, an increase of 2.5%.

Salary expenses increased during the first nine months of 2014 compared to the equivalent period in the previous year, mainly due to the effect of the revaluation which occurred during most of the period of report in the average rate of the shekel against the dollar on expenses, most of which are in shekels. The increase was set off by the effect of the devaluation of the rate of the shekel compared to the dollar at the end of the period on the Company’s liabilities for employee benefits.

The Company’s expenses for jet fuel increased by 1.0% compared to the equivalent period in the previous year. This due to the changes in the fair value of hedging transactions which are not recognized as hedging, payments for hedging compared to receipts during the equivalent period in the previous year, an increase in operations and setting off the decline in the prices of jet fuel in the market. The rate to turnover increased from 32.9% to 33.5%. Total hedging payments during the period of report amounted to $1 million compared to $4.7 million of hedging receipts during the equivalent period in the previous year. In addition, the Company recorded expenses of $5.5 million as a result of changes in the fair value of hedging transaction which are not recognized as hedging (an expense of $2.4 million during the equivalent period in the previous year).

Security expenses the Company recorded a significant decline of $14.3 million as result of an increase in the rate of the State’s participation.

Gross profits during the first nine months of 2014 amounted to $230.5 million, which is a rate of 14.5% of turnover, compared to gross profits of $279.6 million (a rate of 17.4% of turnover) during the equivalent period in the previous year.

Operating income during the first nine months of 2014 amounted to $1.8 million, compared to $46.3 million during the first nine months of 2013.

Net financing expenses amounted to $20.9 million compared to $4.0 million during the equivalent period in the previous year; the increase was a result of the hedging transactions on the rates of exchange.

Net loss during the period of the first nine months of 2014 amounted to $13.2 million compared to a profit of $29.1 million dollars during the equivalent period in the previous year.

El Al’s EBITDA for the first nine months of the year amounted to $84.8 million dollars compared to $121.3 million during the equivalent period in the previous year.

Cash flows from operating activities for the first nine months of the year amounted to $147.9 million, compared to $184.6 million during the equivalent period in the previous year.

Additional data:

As of September 30, 2014, the balances of the Company’s cash, cash equivalents and short-term deposits amounted to $138.0 million dollars.

It should be mentioned that during the third quarter of 2014, the Company invested $66.2 million in fixed assets and other assets, mainly in the acquisition of an additional Boeing 737-900 aircraft, as well as repaying current loans of $48.3 million and receiving loans of $75.4 million dollars to finance the acquisition of new aircraft.

Copyright Photo: El Al’s Boeing 777-258 ER 4X-ECE (msn 36083) taxies at London (Heathrow).

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