Tag Archives: Airberlin Group

Airberlin Group’s first quarter net loss remains flat

Airberlin Group (Airberlin and Niki) (Berlin) reported its first quarter net loss narrowly widened to €210.1 million ($237.6 million), up slightly from €209.8 million $237.2 million) in the same quarter a year ago. Stefan Pichler, CEO of Airberlin Group, stated “We are at the beginning of a long road to recovery.”

Here is the full report:

In the first quarter of 2015, EBIT rose to -159.9 million euros, or 23 million euros over the same quarter last year (Q1, 2014: -182.8 million euros). This demonstrates that despite a competitive market environment, the strategic and operational realignment at airberlin had already begun producing some positive effects on earnings at the start of the year.

Summary of consolidated earnings in the first quarter of 2015

Current performance reviews show airberlin’s average yield at 121.66 euros (Q1 2014: 116.72 euros). This represents a yield optimization of 4.2 percent as compared to the same quarter last year, and was achieved primarily through improvements in revenue management.

Revenue development showed an increase to 793.7 million euros, corresponding to a 4.2 percent growth in revenue over the same quarter last year (Q1 2014: 761.8 million euros). Due to an improved performance during the first three months, operating earnings (EBIT), at -159.9 million euros during the first quarter, also showed a 14 percent increase over the same quarter last year (Q1 2014: -182.8 million euros).

Allowing for current exceptional expenses from the ongoing restructuring program as well as non-recurring effects, adjusted EBIT was -151.4 million euros. Net profit in the first quarter of 2015 was -210.1 million euros (Q1 2014: -209.8 million euros). The Net profit decreased owing to higher interest expenditures and shifts in the market valuation of hedge instruments. 287.6 million euros in liquidity as of 31 March 2015 means Air Berlin PLC is in a stable financial position (Q1 2014: 273.0 million euros).

The current cost structure is marked by a slight rise in personnel and technical and maintenance expenses and increased airport charges. The personnel costs have risen by a direct employee takeover from NIKI, tariff developments and non-recurring expenses. Expenses incurred for technical and maintenance as well as airport charges will, however, be offset over the course of the year by systematic structural effects during the ongoing realignment.

Available seat kilometres (ASK) increased by 1.5 percent. Capacity utilization in the first quarter of 2015 stood at 83.2 percent, a modest increase over the same quarter last year`s rate of 81.8 percent. Total revenue per available seat kilometre (RASK) was 6.71 eurocts (up 2.6 percent on Q1 2014: 6.54 eurocts).

Total costs per ASK (CASK) rose by 0.8 percent year-on-year, going from 8.14 eurocts to 8.20 eurocts.

Stefan Pichler, CEO of Air Berlin PLC, comments on the results of the first quarter as follows:

”We have an initial operational earnings impact from the reduction in capacity and a slightly improved yield management approach. At the same time, seasonal effects such as Easter have also positively influenced the result. Still, we are at the beginning of a long road to recovery.“

Partnerships further strengthened, restructuring measures prove effective

Stefan Pichler emphasizes the importance of airberlin’s strengthened partnerships, in particular with Etihad Airways: ”During the first three months of the year, passenger volume increased by another 18 percent year-on-year, accounting for over 174.400 guests. We intensified our collaboration with Etihad Airways by expanding codeshare connections, with new ones available from Abu Dhabi to Hong Kong, Sri Lanka and Nairobi.“

As well within oneworld® a 19 percent increase in the number of passengers was recorded in the first quarter of 2015. Route performance and effective capacity utilization by the airline partner Iberia contributed significantly to growth.

The restructuring program, initiated in 2014, has already been showing initial positive effects since the start of 2015. Initial positive effects on revenue have been produced by the network restructuring concluded in January, further improvements to the revenue management system as well as the establishment of a new fare concept, and should intensify in the coming months.

During the first quarter, the new “airberlin business benefits” brand was introduced, which combines and further expands airberlin’s many existing corporate benefits. At the beginning of May, airberlin launched its new fare concept for short and medium-haul flights. The tailored fares open up new customer groups for airberlin and offer a great deal of flexibility. Another focus is airberlin’s service offensive. This includes its newly introduced customer advisory boards. In June, airberlin will launch its 24/7 service offensive – from the middle of the year, every passenger will receive feedback on their enquiry within 24 hours, and all customer enquiries will be fully processed within seven working days.

Because of increased market pressures and special expenditures, current foreseeable business development in the second quarter has so far not fulfilled expectations. airberlin will be working systematically on realignment in the coming quarters in order to achieve positive revenue development with respect to revenue passenger kilometres (RPK) as well as steady improvement in average revenue (yield). Continued expansion of product offerings is also of strategic importance in this regard.

Stefan Pichler is convinced of realignment`s effectiveness: “The first quarter has turned out properly. We understand, however, that we need to continue the systematic re-engineering of our company in order to achieve the goals we have set and generate the necessary market momentum. I am convinced that we are on the right track. Our focus on an open and inclusive management culture will enable us to drive further operational improvements.“

Copyright Photo: Paul Bannwarth/AirlinersGallery.com. Airberlin’s Airbus A321-211 D-ALSB (msn 1994) lands at Tenerife Sur.

Airberlin aircraft slide show:

Airberlin cancels its Boeing order for 18 737s and 15 787s

Airberlin (airberlin.com) (Berlin) has cancelled its Boeing order for 18 737s and 15 787 Dreamliners. The airline issued this statement:

Airberlin has reached an agreement with Boeing that it’s orders for 18 Boeing 737 and 15 Boeing 787 aircraft at a price of currently $5 billion to be rescinded. The termination agreement for these 33 aircraft does not include any compensation to Boeing from Airberlin Group, and represents a further important step in the gradual harmonization of the airline’s narrow-body fleet.

Ulf Hüttmeyer, Chief Financial Officer at Airberlin, said: “Not taking on the 33 aircraft ordered will significantly reduce future capital expenditure for Airberlin and improve our balance sheet”.

“Our collaboration with Boeing has always been excellent, and this will remain so. 45 Boeing 737 NG aircraft will remain in service on European short and medium-haul routes. In order to operate more flexibly in the future and further reduce costs, standardization of our fleet is a key element of our restructuring”, Ulf Hüttmeyer continues.

The transition to a uniform narrow-body fleet should be completed by the end of 2016.

Airberlin Group will continue to dynamically adapt the existing fleet to its needs by purchasing or leasing suitable aircraft, although this will be on a smaller scale than originally planned. Already, Airberlin is well positioned, with one of the youngest fleets in Europe.

Copyright Photo: James Helbock/AirlinersGallery.com. Boeing 737-86J D-ABMS (msn 37782) approaches the runway at Paine Field in Everett.

Airberlin:

Airberlin Group takes delivery of the first Airbus A320 with Sharklets

Airberlin Group (Berlin) on March 26 took delivery of its first Airbus A320 with the new Sharklets wing tip device. The pictured A320-214 OE-LER (msn 5522) will be operated by Niki (Vienna).

The group issued this statement:

OE-LER, welcome to our fleet! The Airberlin Group became one of the first airlines in the world to receive its very first Airbus A320 equipped with fuel-saving Sharklets at the Airbus factory in Hamburg on March 26, 2013. The development sees the company further strengthen its position as Europe’s most eco-efficient network carrier.

The aircraft with the Airbus manufacturer’s serial number msn 5522 will fly under the registration OE-LER for the airline Niki, which belongs to the Airberlin Group. Following test flights and extensive technical checks, the transfer of title of the aircraft to the Airberlin Group took place on March 25 before the March 26 ferry flight from Hamburg to Vienna, the home of Niki.

Commenting on the delivery, Ulf Hüttmeyer, Chief Financial Officer airberlin, said: “The new Airbus is the first of a total of 14 Airbus A320/A321 aircraft with the fuel-saving wingtips to be delivered to the Airberlin Group. The Sharklets represent an important aspect of our ‘Eco-Efficient Flying’ program and will contribute towards making the Airberlin and Niki fleet even more efficient and environmentally compatible in future. The delivery of the first Airbus with Sharklets to Niki is part of a sales and lease back transaction between our company and the Chinese leasing company ICBC Financial Leasing with which we have already been working together successfully and reliably for several years in the area of aircraft financing.”

As part of the sales and lease back cooperation arrangement with ICBC Financial Leasing, the Airberlin Group is to add another Airbus A320 with Sharklets to its fleet in June of this year.

The two-and-a-half meter large upward wingtip extensions reduce air vortices at the wings and hence the lift-induced drag. The eye-catching Sharklets developed by Airbus thereby significantly improve the wing aerodynamics and are capable of saving around 1,200 tonnes of CO2 emissions with fuel savings of up to 3.5% per aircraft each year. This represents 55 flights from Berlin to Palma de Mallorca per aircraft every year. Sharklets work according to a functional principle by which the improved lift effect also enables the Airbus equipped with Sharklets to ascend more quickly. This in turn reduces noise on the ground.

Airberlin: