Sunday, May 28, 2017

Montenegro Airlines drafts recovery plan


Montenegro Airlines is finalising a draft of its recovery plan after the company posted a record 11.4 million euro loss in 2016. The carrier said that work on its long-term development strategy will be completed within the coming weeks and submitted to the government for approval. "The strategy will include an evaluation of the current financial situation in terms of debt, our position on the market, as well as the structure of our workforce. We will suggest several solutions for the future. Keeping in mind the airline's importance for the continued development of the transportation sector in Montenegro, we want the government to recognise the direct impact the company has on the tourism industry", Montenegro Airlines said. It added that a greater emphasis is being put on optimising its operations. "Ongoing optimisation entails the reduction of costs, but also defining the company's position on the market", it noted.

During the first quarter Montenegro Airlines handled 82.874 passengers, a decrease of 2.1% compared to the same period last year. However, its numbers improved in April when it carried 37.625 travellers, up 3.3%. "It is important to note that these results have been achieved following a series of operational issues in January and with just two to three aircraft compared to six last year. Advanced bookings between June 1 and October 1 show that revenue generated from ticket sales for this period has reached 6.8 million euros", the company said. The carrier noted that the expansion of low cost carriers onto the Montenegrin market is putting a greater pressure on its operations.


Number of carried passengers during Q1 2017

AirlinePAXChange (%)
Air Serbia453.859 8.1
Croatia Airlines329.320 4.4
Adria Airways227.588 8.3
Montenegro Airlines82.874 2.1

Earlier this week, Montenegro's tax authority said it had rejected a tax restructuring program submitted by the carrier. Montenegro Airlines owes the state 15.4 million euros in tax and unpaid worker benefits. The carrier suggested for its debt to be reprogrammed and repaid over the next five years. However, the tax authority noted that, since the airline was a beneficiary of state aid in the past, it cannot approve the restructuring program under such terms. Despite the setback, the carrier said, "Even though the negative media reports are having an impact on our business, Montenegro Airlines would like to inform its passengers and partners that the company's operations are stable and all flights are running as per schedule".

61 comments:

  1. I remember last year Etihad also made a recovery plan for them. Guess that didn't work out.

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    1. Like most of their recovery plans.

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    2. Etihad needs to make a recovery plan for itself.

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    3. The original EY plan was for Alitalia to buy Air Malta and Air Serbia to buy Montenegro Airlines. Of course all of those plans have been cancelled now.

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    4. ^ thank god that didn't materialize. Montenegro Airlines would be a liability to any company buying it.

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    5. And with what money would JU buy YM and AZ KM? Probably with more loans or from government aid.
      I love how generous EY is with other people's money. What a parasitic systm.

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    6. Well you can't blame them really. EY was created out of state aid, bank loans and subsidies.

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    7. What about airSerbia recovery plan?

      That airline has cost Serbian taxpayers over €460 million, and is losing ~€40 million per year. JAT/airSerbia - same company when it comes to financial books and taxpayers paying for it.


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    8. I'm sure you've got all the numbers.

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    9. Anonymousat 5:16 PM
      +1000

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    10. That airline has cost Serbian taxpayers over €460 million, and is losing ~€40 million per year.

      Докле више морамо да трпимо ове лажове? Сто пута је доказано да су ови бројеви лажни јер укључују Јатове дугове итд. Ако имају линк на неки нови доказ океј, а ако се само понављају старе лажи не видим разлог да се и даље толерише овакав терор.

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  2. Montenegro Airlines can only survive if it can milk the Serbian market. That was its whole strategy from the get go. We all remember their flights out of Belgrade, the creation of Master Airways, INI flights... even today, Belgrade is their only destination where they can fly daily.
    Once all of these were lost their situation became hopeless.

    Add to this the ongoing political crisis in Montenegro and their chances of survival become even slimmer.

    That said, JU's and JP's growth so far has been rather impressive. If their summer season goes well maybe we could even see a double digit growth.
    Before some on here attack me, people who work for ASGS told me that one or two A319s will be exclusively used for charter flights.

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    1. What about the boeings 733 NEMJEE ?

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    2. Agree completely about MGX.

      As for JU, with the plane configuration changing there is no reason why the Airbuses can't be used for charters.

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    3. A friend of mine who works for Jat Tehnika told me that two should be retired this year, their time is up. I still it's a shame they weren't fully integrated into the Air Serbia fleet. Oh well...

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    4. That should still leave 2 B737s in the fleet, right?

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    5. It is interesting that them becoming a national airline of an independent Montenegro has done more damage to them then if the country stayed together. With the sky becoming deregulated they could have used the disaster which was Jat in 2011,12,13, and based 3 planes in BEG and really profited from it.

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    6. Nemjee, do you know which 2 B733 will be retired?

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  3. The government does not seem to be too interested in MGX.

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    1. Yes this is a bit suprising. I mean you would think the tax authority would approve anything if the government gave them a nod.

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    2. Milo's regime is slowly starting to collapse and he is trying to save as much can be saved. Look at the elections in Herceg Novi...

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    3. If it were not interested the company would have been long gone.

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  4. The only hope for them is to get bought by someone.

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    Replies
    1. Or shut down.

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    2. The only chance they have got is for someone like 4K invest to buy them. And I;m not sure even they would want them.

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  5. Both the financial and passenger results are really bad.

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  6. Sorry but I think this is beyond repair. Those losses and debt are staggering and it's not just that. All of their operational results are terrible.

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    Replies
    1. Better maagment and an actual strategic plan and numbers will improve.

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  7. "The carrier noted that the expansion of low cost carriers onto the Montenegrin market is putting a greater pressure on its operations".

    You had 15 years to adjust while your government shielded you from competition and denied people the choice to fly at cheap fares.

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    1. Well the good thing is that at least now they are allowing low cost airlines and issuing permits without a hassle so hopefully there will be more and more options.

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  8. I honestly hope their consolidation works out.

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  9. What happened to the Iran flights?

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    1. http://www.exyuaviation.com/2017/04/montenegro-airlines-maintains-iran-plans.html

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  10. This airline could work. All they need is a professional managment.

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    1. The debts are so huge I don't think even Christoph Mueller would make it work.

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    2. He turned Aer Lingus into a profitavle business.

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    3. He also found Brussels Airlines a day after SN Brussels went bust and managed to steer Malaysia Airlines out of a bankruptcy after the double crash.

      https://en.wikipedia.org/wiki/Christoph_Mueller

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    4. But failed with Malaysian.

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    5. A lot of people are saying he will be the next CEO of Etihad Airways.

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  11. Next market they will withdraw from will be Slovenia. They can't compete against daily Adria flights

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  12. So during the first quarter ex-Yu airlines handled 1.1 million passengers. Not bad.

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    1. I would say quite poor considering the market size.

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    2. I don't think it's bad. Keep in mind it's Q1.

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  13. I can only imagine what genius plans these guys came up with for their recovery.

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  14. Hopefully YM will recover soon but I am hoping not to see Daliborka's return, she might want to participate again and take a stake of the airline.

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  15. What can they actually do?

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  16. So let's say they go bankrupt, who do you guys think would pick up the pieces? It might not be a big market but it has a good mix of diaspora and leisure travel and is not as seasonal as other leisure markets.

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    1. It could give an incentive for Croatia Airlines to come back to Podgorica.

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    2. I assume Wizz Air and Ryanair would expand quickly.

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    3. Adria could have also used this opportunity, plus hey have a neutral name. Their LJU-TGD-LJU flights are doing really well and they have lots of transfers. That is why they increased their frequencies so much. They could have used the CRJ700 from Lodz and based it in Podgorica.

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    4. No Croatia, no Adria. LCCs please!

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    5. JU ofcourse!

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  17. They have been risking insolvency for years yet they are still here.

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  18. Samo jos par informacija.
    "Poslovni rezultat za četiri mjeseca ove godine je za 1,1 milion eura bolji u odnosu na isti period lani. U prvom kvartalu smo prevezli 82,87 hiljada putnika u redovnom, čarter i kod-šer saobraćaju. Ovaj rezultat je ostvaren sa 49 letova manje u redovnom i 44 leta manje u čarter saobraćaju. Samo tokom aprila prevezeno je 37,6 hiljada, što je za 1,2 hiljade putnika više u odnosu na isti mjesec prethodne godine i to sa 20 letova manje u redovnom i 14 u čarter saobraćaju, uz povećanu ponudu u kod-šer saobraćaju”

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  19. I just want to ask have they said they will be a regional leader? It is the go-to catchphrase for all of the national airlines in ex-Yu.

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  20. ♫ ♬ :funeral march playing: ♫ ♬

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