Comair almost doubles half-year profit

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South African carrier Comair almost doubled its operating profit to R233 million ($21 million) in its first half ended 31 December 2013.

The comparable figure from 2012 was R124 million.

Revenue grew 23% to R2.96 billion, which the carrier mainly attributes to its 15% increase in capacity as it replaced several Boeing 737-300s in the fleet of its subsidiary Kulula with four 737-800s.

Flightglobal’s Ascend Online database shows that Kulula now operates a fleet of nine 737-800s and two 737-400s.

Operating expenses increased from R2.18 billion to R2.59 billion during the six-month period. Comair says the weak rand led to a 14% increase in fuel prices.

The company also spent R140 million to buy back a previously owned 737-800. The balance was funded through a revolving credit facility. Ascend Online shows Comair has one 737-800 in service. That jet was previously owned by Jet Airways.

A further R151 million was used to repurchase 10% of the share capital of the company.

“We remain well placed for the full 2014 financial year, despite a further 12% increase in the fuel price since December, driven mainly by the depreciation of the rand. Our current after-tax profit margin of 5% leaves scope for further improvement, as it remains below the average of 7% for the transport and logistics sector as published by the [South African] Department of Trade and Industry,” says Comair.

During the period Comair continued with pre-delivery payments towards its next four new 737-800s which are due to be delivered in late 2015 and 2016.