Monday, May 12, 2014

Jat Airways/Air Serbia records 2013 loss

Serbian carrier records 73 million euro loss in 2013

Jat Airways, for the first ten months of 2013, and Air Serbia, for the last two months of the same year, has recorded a loss of 73 million euros, the airline has said. The Serbian carrier accumulated an operational loss of 45 million euros during the year, while the remaining 28 million came as a result of errors made in previous financial reports published by Jat Airways. For its 2013 financial report, which publicly owned companies in Serbia are required to publish in May the following year, the airline used International Financial Reporting Standards (IFRS) for the first time, which is designed as a common global language for business affairs so that company accounts are understandable and comparable across international boundaries.

Air Serbia’s CEO, Dane Kondić, says, “In line with international standards, we now have a clean balance sheet. The 73 million euro loss is related to the many years of bad business by Jat Airways. We now turn to the future and thanks to our partnership with Etihad Airways and the strong support from the Serbian government, Air Serbia now has a strategy for recovery as well as the foundations for creating a profitable and strong company”. Only recently, the CEO of Etihad Airways said he expects to see Air Serbia break even in 2014 or possibly record a small profit.

Despite the significant loss made last year, Mr. Kondić believes the airline is on the right path. “We have done a lot and we continue to work to set sound foundations for further business. We have commenced an ambition fleet renewal plan and an expansion of our destination network. Furthermore, we have invested in products and services in order to improve our customer service”. The airline’s CEO adds that Air Serbia has recorded significant passenger growth of 66% in the first quarter of 2014 and has increased the amount of cargo flown by 46%. “I am completely certain that the future will bring positive results. We will build up a regional leader in the field of aviation that will have long term value for its shareholders”, Mr. Kondić concludes.

The official takeover transaction between Etihad Airways and the Serbian government was completed in early 2014. Therefore, this year’s financial results will give a clearer understanding as to whether this ambitious project is actually sustainable. Under Serbian law, companies which are not floated on the Belgrade Stock Exchange (such as Air Serbia) are not required to publish quarterly financial reports. Ever since financial results for Serbian companies are required to be made publicly available (since 2004), Jat Airways has not recorded a single year in profit.

38 comments:

  1. i support airserbia, and hope this year will be on positive 0, but from next year, JU will start making money which will have positive impact on serbian economy, but also help people in region to use good quality service and enjoy flying with us :D i mean, i would like it.

    ReplyDelete
    Replies
    1. The effect Air Serbia has on the Serbian economy goes much further than making or losing money (which is still important). Air Serbia employs hundreds of people, including some of the best paying jobs in Serbia. Air Serbia also makes Serbia more accessible to foreign investors, which is very important as well. Air Serbia also indirectly employs thousands of people through vendors and airport workers, further helping the economy.

      Delete
    2. Postovani A. Stojanovicu, sa zadovoljstvom se slazem sa Vasim stavom po pitanju vaznosti ER SRBIJE.
      Iskreno nemogu prihvatiti jedan pasus u Vasem tekstu, gde kazete: "Efekat ER SERIJE ide na ekonomiju Srbije mnogo dalje, nego praviti ili gubiti novac", gde jos dodajete "whitch is still
      important"... Takav stav nikuda ne void izuzev To be LOOSER! Ne vise za ime Boga. Osnovni zadatak za ER SRBIJU
      jeste profit, a sa profitom dlazi ponosno nosennje zastave Srbije na trupu,sa svime ostalim sto ste nabrojali i mnogo vise od toga. Da bi drzava SRBIJA opstala, MORA imati profitabilan biznis
      IN and OUT. Vasa i a ko dozvoljavate i moja AIR SERBIA, Mora da prvi profit, da placa porez, isplacuje serove ulagacima, zarade personalu...pa onda sve ostalo sto je potrebno I obavezno.
      Oprostite mi na obzervaciji, daleko sam dvadesetak hiljada kilometara, pa mozda ne shvatam komercijalnu aviaciju i odnose shvatanja u zemlji Srbiji. Vama svako dobro u prolecnoj Srbiji, nacionalnoj avio kompaniji uspesan pocetak pravljenja PROFIT. Srecne i zadovoljne na aerodromima i na letovima gostima AIR SERBIA. Gospod da nas sve Blagoslovi za dobro ljudi koji plove u podnebesju Gospodnjem!
      Rod Marinkovic,AME, Sydney-Grifith // Kraljevo.

      Delete
  2. http://www.rts.rs/page/stories/ci/story/134/%D0%A5%D1%80%D0%BE%D0%BD%D0%B8%D0%BA%D0%B0/1595582/%D0%90%D0%BB%D0%B1%D0%B0%D0%BD%D0%B0%D1%86+%D0%BF%D1%80%D0%B5%D1%82%D0%B8%D0%BE+%D0%B4%D0%B0+%D1%9B%D0%B5+%D0%B7%D0%B0%D0%BF%D0%B0%D0%BB%D0%B8%D1%82%D0%B8+%D0%B0%D0%B2%D0%B8%D0%BE%D0%BD.html

    ReplyDelete
  3. OT: can someone explain to me what is going on with second JUs a320? i can see only one flying to cdg (morning and afternon flights) and the same one to skp on daytime. I dont understand if JU really has 2 a320?? and if it has, why not using? thanx forward..

    ReplyDelete
    Replies
    1. The second one is in Germany undergoing significant galley reconfiguration modifications in order to bring it in line with the remaining 9 aircraft so that JU can deliver a consistent inflight offering across all the jet aircraft ... it will be in the fleet 1st week of July

      Delete
    2. Fiirst week of July? Two months for galley? Yeah, right! C-check is made in twice or 3 time less time

      Delete
  4. To poof my loyalty, in stead to congratulating strong push forward to achievements in business, rather I love to fly on your destination AUH - BEG in approximate five mounts tine, with my better half . Only way to by true positive to AIR SERBIA (and any airline) is to fly wit you.
    See you soon, future proudness in commercial aviation of State of SERBIA. Keep good work. We will be with
    AIR SERBIA now and all ways. GOD Bless guest to Serbian national carrier and hard working team of
    AIR SERBIA. Yours Rod Son & Co.
    Rodney Marinkovic, A M E. Sydney-Griffith /// Kraljevo.

    ReplyDelete
    Replies
    1. Hello Mr. Rodney,

      Are you traveling from Sydney, Australia, to Belgrade? If you are, I think Etihad/Air Serbia is the only possible way to make the trip with only one stop.

      Aleksandar Stojanovic, Student Pilot. Walla Walla / / / Belgrade

      :)

      Delete
    2. Postovani Mr. Aco Stojanovicu. Da bi se letelo sa AIR SERBIA (divno se osecamo i ja i supruga u preporodjenoj ER SRBIJI!) jedini nacin jeste let sa ETIHAD-ovim B777-300 za sada do dolaska u flout Erbasovi A380 duble decker. Postoji alternative jednog sletanja, a toje QANTAS ili EMIRATE iz Sydney-a do Dubai-a, a zatim sa Flydubai od Dubai-a do Beograda. Uz svako dobro od GOSPODA za Vas uspeh u zapocetoj pilotskoj karijeri zajedno sa AIR SERBIA, zelim mirne letove i radost pod nebesima Bozjim.
      Vas dobrozeljatelj , Radovan Marinkovic Australia // Srbia

      Delete
  5. No, another possibility is EmiratesFlydubai but this is not daily connection.

    ReplyDelete
  6. I noticed 1 passenger coming from Seychelles to Vienna via Belgrade today. Interesting.

    ReplyDelete
    Replies
    1. Wow !!! ONE transit from SEZ to VIE !!! Now I'm sure JU is booming its profits this year already and Hogan wins the bet !

      Delete
    2. AUH is the main hub for flights to Seychelles but does not have direct connection with VIE. Etihad sells SEZ-VIE tickets with 2nd stop in DUS or TXL which requires a lot of extra time compared to BEG.

      Any transfer passenger is a good one, especially if he/she comes as a pure bonus for JU (which is the case in SEZ-VIE connection).

      Delete
  7. We can just imagine how munch Air Serbia "future" costs are in that debt? Like pilot training, new airplane deposit, maintenance in last second to pay in advance etc. etc. It is easy way to put more debts on tax payers and to make Air Serbia looking better than it really is.

    ReplyDelete
    Replies
    1. yes, this would be an interesting info to see. Judging by the fact that previous years' losses were in low to mid twenties ($M) I think that a lot of this one-time costs related to pilot training, lease deposits, branding etc. were actually included in 2013. 51% of it is payed by taxpayers , you are right. But it costs to run a business but even more to start it up. At least they are investing it this time with some hope if seeing return on this investment. Not like before where they were just trowing money at it to cover salaries.

      Delete
    2. 100% of this costs goes to taxpayers because all debts, including those, are on Serbia account only. Etihad did not pay a peny of those debts. That was the deal!

      Delete
    3. Today's article is not about Jat's debts but the company's loss in 2013. Debts and operational loss are two different things.

      Costs of rebranding, leasing and training were mostly financed from Etihad's loan facility that has been converted into their 49% of ownership. Hence they do not contribute to Jat's debts.

      Delete
    4. But what you put operational loss into debts (like advance for maintenance of 737 and ATR fleet) and on that way into debt to taxpayers.

      Delete
  8. Anyone has any info on the reason for the delay of today's flight to LJU?

    ReplyDelete
    Replies
    1. lol you guys are crazy. Now you are asking why there is a particular delay on a certain flight. Who cares.

      Delete
  9. Well, obviously the one who is politely asking cares and expects a polite answer. He is not trying to offend anyone, it is a simple question. Such replies are unnecessary.

    ReplyDelete
  10. OMG!!! This is horrable!
    In Serbia every winter a couple of people dies because of coldness and starvation, and the goverment is spoiling money away to Air Serbia to show what exactly??? I'd be happy to for JU to be LH instead of LH, but people just count more... We do not have money for this games! Horrible, horrible!!!

    ReplyDelete
    Replies
    1. O boze.

      That is Jat airways loss! A part of that loss is MAYBE Air Serbia loss from october 2013. till 31st december 2013.

      I say "maybe" because Air Serbia did exist as brand from october 2013, but I do not know if that is taken into calculations or not since I dont know if the shares were transferred until october or not.

      Once again, this number is Jat Airways.

      Delete
    2. Jesi li ti normalan?

      Delete
    3. I don't know how this applies to Serbia, but didn't the fiscal year ends in March 31? So fiscal year is not from December to December and it make sense to publish it now.

      Delete
    4. @Ivica: The fiscal year in Serbia is from JAN1 to DEC31. Results are published in May because by law you must publish them by mid May (and usually most companies do in the last minute)

      Delete
  11. Mr. Hogan is reported to have made a bet that Air Serbia will conclude the 2014 with profit.
    With such massive growth Mr Kondic will have to buy big drink (to Mr. Hogan).
    I would recommend haters and general purpose skeptics to start saving for insomnia tablets.
    Regards

    ReplyDelete
    Replies
    1. Did you see the movie with Eddie Murphy where two old billionairs in N.Y. bet for 1 dollar (or big drink in this case) about the future of two young men? Well, this bet reminds me A LOT to that movie; only here it's not about 2 men, but about ALL taxpayers in Serbia. And. just btw. I don't suffer from insomnia, and I have just enough money not to save for anything, including pills.

      Delete
  12. Za par dana ce da objave fin. r. za prvi kvartal ;)

    ReplyDelete
    Replies
    1. Under Serbian law, companies which are not floated on the Belgrade Stock Exchange (such as Air Serbia) are not required to publish quarterly financial reports.

      Delete
  13. I do not recall someone mentioning that from 3rd May Croatia Airlines is flying for the first time between Split and Athens. Flights operate once a week, every Saturday with the A319 and A320. They will operate in addition to the Zagreb-Dubrovnik-Athens flights!

    ReplyDelete
    Replies
    1. It has been reported several times.

      http://exyuaviation.blogspot.com/2014/05/new-flights-across-ex-yu.html

      http://tesdfdfd.blogspot.com/2013/10/croatia-airlines-split-athens.html

      http://exyuaviation.blogspot.com/2014/03/summer-2014-croatia-airlines.html

      Delete
  14. EX-YU Aviation at 5:09

    Many posts turn into country vs. country discussion here, sad outcome for true aviation fans. One option would be heavily moderated posts but that has downside, requires more effort and slows down interaction. No comments policy would take away quality info found in some comments. Splitting EX-YU into separate country blogs would lack the bigger picture. There's no ideal solution, it seems.

    However I feel they are all better than this abuse of comments large majority of aviation fans have to endure when following otherwise excellent blog!

    ReplyDelete
    Replies
    1. I have tried to filter through today's nationalist nonsense.

      Thanks for the feedback :)

      Delete
    2. One immaterial feedback, for the sake of punctuality: you have a minor typo in the text. The abbreviation for International Financial Reporting Standards is IFRS, not IFRC :)

      Delete

Before posting a comment be mindful of other participants and readers. EX-YU Aviation News does not tolerate insults, excessive swearing, racist, homophobic or any other chauvinist remarks or provocative posts with the intention of creating further arguments. Such comments will be deleted as soon as possible. The opinions expressed by those providing comments are theirs alone, and do not reflect the opinions of EX-YU Aviation News. Thank you for your cooperation.