 |
| Croatia Airlines’ passenger numbers and finances improve |
Croatia Airlines has recorded modest passenger growth in 2014, while its net profit soared almost ten times compared to the year before. The numbers represent Croatia Airlines’ second consecutive year in the black as it enters the final stages of its restructuring program and prepares for privatisation. The Croatian carrier handled 1.825.063 passengers last year, an increase of 1.6% on 2013, while the number of operated flights grew by 3%. The airline’s average cabin load factor stood at 69.2%, up 0.4% from 68.8%. Furthermore, the airline’s punctuality rate was above the industry average, with 84.7% of its flights on time (within fifteen minutes of the scheduled arrival or departure time). However, in a preliminary report, Croatia Airlines says that high seasonality, coupled with the state of the country’s economy, had a negative impact on the carrier’s results. It ended the year as the former Yugoslavia's second busiest airline for the first time in years, behind Air Serbia which handled over two million passengers in 2014.
| Year | PAX | Change (%) |
|---|---|---|
| 2014 | 1.825.063 | ▲ 1.6 |
| 2013 | 1.795.885 | ▼ 8.0 |
| 2012 | 1.951.501 | ▲ 3.9 |
| 2011 | 1.879.016 | ▲ 14.5 |
On the financial front, the Croatian carrier reported a net profit of 921.000 euros, which is almost ten times greater than the year before. Despite a 2% decline in operating profit, the airline managed to conclude a sale and leaseback agreement for one of its Airbus A320 aircraft and three engines. Furthermore, the carrier sold property at Zagreb Airport and managed to decrease costs by 2%. A fall in international oil prices in the fourth quarter also helped the carrier. The airline spent most on flight operations, followed by services, promotions and sales, and aircraft maintenance. The carrier is losing money during the winter season when it holds 68% of the Croatian market, while it generates the greatest profit during the summer when it maintains only a 22% – 38% market share. “In 2014 we continued to implement cost saving measures, which is a persistent task that is systematically implemented in all areas of the business and corporate governance”, the airline says in its report.
The Croatian State Management Office (DUUDI) has published its outlook for Croatia Airlines for 2015, during which it believes the carrier will see a significant increase in its net profit and passenger numbers. According to DUUDI, the Croatian carrier will record a net profit of 12.4 million euros this year. This will be achieved through an increase in revenue as well as sale and leaseback agreements of its aircraft and engines. Furthermore, the airline is expected to handle 1.987.231 passengers this year, of which 1.908.644 should come from scheduled services, and the other 78.587 travellers on charter flights. In addition, the State Management Office forecasts an average cabin load factor of 72.4% in 2015.
Wait... I am confused now. Was the profit increased because of the sale of the A320 and its engines or what?
ReplyDeleteCombination of both
DeleteSo how much is the actual profit, without the sale of its aircraft and the spare parts.
DeleteThat is called artificial book keeping .So that means No Profit
Delete@AnonymousFebruary 16, 2015 at 9:05 AM
DeleteNo sale of engine happened in 2014, plan is to sell two engines that are no longer needed in 2015, deal was struck with Dutch operator for the two engines, price of which isn't disclosed, but estimated value of said engines is around $12 million. all the information can be found on Croatia's own website, just go to annual report.
Also Croatian for this year won't have lease payments in its balance sheet for older A320 it had to return to former lessor, savings of $3,2 million.
Operating profits for 2014 were based on operations which saw drastic cuts in revenue (1.64 billion kuna) from 1.78 billion kuna in 2012.
Heaviest losses OU faces are over winter months when airline has low yield per seat, losses tantamount to 200 million kuna for period between Nov 1st and April 1st. OU plans to address this issue of seasonality and likely reason why DH4 will remain backbone of OU's fleet for sometimes.
A very likely scenario is retirement of remaining 2 A320s and replacing them with additional 4 DH4 aircraft OU still has under option with the manufacturer. A320 are too big for Croatian market during winters, and with 174 seats they're more suited for larger markets with higher yields. OU owns both aircraft and sale of these two might become possibility after 2016.
A319s will remain in the fleet for they're perfect for Croatian market but, still too large in winters when yields are too low. OU is holding talks with Bombardier of converting four options for DH4 in to CS100s with deliveries after 2017, but priority for the airline is to cut the losses down during winters with are staggering for a small carrier such as OU.
That is called artificial book keeping .So that means No Profit
DeleteNO, it ain't, Parliment of Croatia can take a look at daily operations of any state run company and any improprieties can be reported to USKOK, in Croatia there are strict laws in this regards as evident by many arrests and many corrupt politicians and businessman ending in prison over past few years.
U can't just make silly numbers and hope someone won't notice. things here are done in accordance with the EU laws, very strict, 5-6 years ago I'd agree with you, but not anymore, things have changed a lot in past 4 years, things are a lot stricter and by the law.
The question here is not what is done strictly according to law or EU standards - we have seen many companies fail in such jurisdictions where EU laws prevail. I am curious to know who the external auditors were. Unless it is one of the "Big 4", then one can question the voracity of these results....
Deleteit says in the article that it is a preliminary report so it hasn't been audited yet.
Delete@AnonymousFebruary 16, 2015 at 2:45 PM
DeleteAudits are done in accordance with FINA and EU rules, there are several Audit firms based in Zagreb and all state firms need to be audited at the end of financial year by independent auditors. The report is than presented to the parliament, the Audit won't be ready before April 1st, when audits of all state firms are due.
Any misappropriation of funds and lies on annual statement would normally instigate legal action by state commission or USKOK, its all according to EU laws, on great thing about the EU, some might hate it, but it has cut corruption really down, there's still loads of corruption around, but with each passing year corruption goes down.
Few months ago 9000 workers for many state firms were found to have false diplomas and lied about their qualification and education to get the job, all of them got fired, some 20 000 cases are still pending, some serious stuff here.
Olympic and Alitalia have been doing audits in accordance with EU rules for decades yet that never prevented them from cheating. Same can be done in Croatia especially since corruption is widespread.
Delete@AnonymousFebruary 16, 2015 at 3:54 PM
DeleteWhat they do in Italy and Greece where corruption is twice as bad as it is in Croatia is issue Italian authorities should be looking at, Olympic went bust quite a few years ago, so not sure what you're referring to.
Croatian lawmakers are bit more stringent than Greek or Italian, you'd find that if you ever visit Croatia, many things have changed since Croatia was in Yugo Federation, also there's a perception of corruption, albeit corruption is going down really fast thanx to EU and Croatia's membership of the EU, laws are being enforced and country is moving towards strong legal state/rule of law. (Pravna država)
http://en.wikipedia.org/wiki/Rule_of_law
http://hr.wikipedia.org/wiki/Pravna_dr%C5%BEava
Hahahaha yes, yes... you can serve that story to the westerners but not to all of us in the Balkans who know how the real situation is. Just look at how much corruption there is in Slovenia and they are twice better than all of the rest of YU put together.
DeleteThe external audit must be done in accordanec with IFRS, or it aint worth shit .... Big 4 audit to IFRS, not some dodgy Croatian laws .... If it gets a clean audit by one of the Big 4 according to IFRS, then the accounts are true and fair and no one can have any issue or be critical of them - simple as that
Delete@AnonymousFebruary 16, 2015 at 6:08 PM
Deletehttp://www.kpmg.com/hr/en/pages/default.aspx
All of them have to comply with FINA rules in Croatia,
http://www.fina.hr/Default.aspx
Which operates under EU rules and laws as well as Croatian rules and laws, as do all accounting firms that wish to operate with in the EU, including the big 4.
U might think Croatian and EU laws are dodgy, these are the laws that we and the EU has, I am sure since you dislike the EU so much you'll have opportunity to voice your opinion at the next elections and demand Serbian laws for Serbs and f*off EU and their dodgy and corrupt laws, how dare they enforce these on honest working people.
Dude, relax and take a chill pill ... You need to settle that blood pressure. I am sure that EVERYTHING in Croatia is done in accordance with EU laws - that bastian of righteousness. That being the case, what is the issue with having OU accounts audited by one o fthe Big 4 in accordance with IFRS - just like all the other big airlines in Europe - who no doubt have to comply with relevant EU laws, but nonetheless choose to have their accounts audited independently by one of the Big 4 ? They certainly have nothing to fear or hide. Why should OU ? I guess you prefer a hometown judge and jury to validate their accounts for obvious reasons ....
Delete@AnonymousFebruary 16, 2015 at 7:55 PM
DeleteAre you saying that OU's accounts aren't audited by an independent auditing agency ?
By Croatian law all state firms need to be audited by an independent auditing firm, the big 4 you're referring to have their Croatian offices in Zagreb and are doing auditing,
As to who of the big 4 is auditing OU's accounts I'm sure you can go to http://www.croatiaairlines.com/ and find out.
how can a govt agency auditing the accounts of a govt owned airline be independent ???? Jeez .....
DeleteWhy do you feel the need to bring Serbia into this? Are you that troubled?
Delete@AnonymousFebruary 16, 2015 at 9:20 PM
Deleteare you being stupid or just it comes naturally to you ?
If I said independent than it is independent, non governmental agency, FINA if this is who you're referring to, is a financial regulator and financial agency responsible for raft of issues, including the tax returns and audits, in short it is a tax office for the government. Financial Police which is also part of FINA is anti corruption body along with USKOK another law agency in Croatia.
Independent auditing firms are Standard & Poor, Dun and Bradstreet, Anderson Cooper, KPMG, Fitch and so on, all of whom have offices in Zagreb and their Croatian branches including Croatian Accountancy firms who they work across the country not only Zagreb.
All state firms go through independent audit, which is than presented to parliamentary comity . Any state firm deemed wasting tax payers money can be shut and liquidated.
@Anon at 10:24PM
DeleteI had a great day, skipped most of the comments and decided to read one with famous blank lines at the bottom. It didn't disappoint, stupid as always! Highlight was listing of audit firms as a "guarantee" of integrity! You are certainly aware how Enron was audited by Arthur Andersen, EY and PwC and it was all clear! Oh yes it was all perfect just like OU and then one day Enron scandal erupted...
OU holds 68% of the total HR market in winter?!?! And then people dare to complain about JU's marketshare in BEG.
ReplyDelete+1000
DeleteAnd just 22% in summer!!!!! So, when it is profitable high season there is just 1/5 of market share. As winter season is much less passengers that is just 42% market share in all year bases.
DeleteYou cannot compare that to Air Serbia which has 60% market share in all year.
Yeah, well Air Serbia has (not much) less share during the summer as well..
DeleteThe type of summer passengers in Croatia and Serbia are not similar at all, so people should just stop comparing those countries.. Who has more, who has a bigger..
Let's also not forget that Wizz Air's expansion in INI will reduce Air Serbia's marketshare.
DeleteAt least the south will have scheduled, year-round flights.
Actually, what's great about W6 and INI is that one share of the passengers will no longer have to fly out of BEG. This will make more room for JU's expansion, especially since BEG is seriously running out of space.
Delete@ 11:43
DeleteIt will reduce it for something about 1.5 percent since (Air) Serbia handled its two millionth passenger in october.
Anyways, Serbia has 6 times less tourists, so it is normal that it has a constant share in passengers throughout the year.
Also, it is normal that OU has less share during summer, because Croatia is overwhelmed with tourists.
You dont really exepct OU to open Talin or Manchester or Glasgow or Bristol?
Where would they get their planes from?
So, to prevent further argument: the reason why OU has more share during winter than BEG during the same period is also because of the domestic travel, which Serbia does not have...
I don't get you guys, how is Air Serbia having a 60+ market share anything bad? That's a great thing. Just look at other successful airlines such as TK, QR or EK, they all have total dominance at their home base, so what? This sounds to me like world inverted. Maybe the next thing they'll start complaining about is that Air Serbia is having 'too much passengers'.
DeleteAir Serbia doesn't actually have a 60+ market share. It's market share is 50-52%. Around the same time BEG handled its 4 mill passenger, Air Serbia handled its second mill. Jat had a simmilar share until around 2007. Adria's share at LJU is above 70% and then you have B&H who has a share of barely 10%.
DeleteWell because people accused JU of having "monopoly" in Belgrade...
DeleteAnd thats how it all started...
That's right. ASL market share at BEG is approximately 52%. And, I agree with anonymous at 12:11, why wouldn't Air Serbia have 60% or even 70% market share? Just look at Delta at ATL, or Turkish at IST, or QR at DOH.
DeleteBG | NIC
@;AnonymousFebruary 16, 2015 at 12:11 PM
Delete"Anyways, Serbia has 6 times less tourists, so it is normal that it has a constant share in passengers throughout the year. "
Make that 10 times less ;)
LF below 70 %, and there are always discussions about ASL low LF on this forum...
ReplyDelete+1000
DeleteSo true...
It is very bad LF, but Air Serbia all year LF is just 58%, so that is 11% more than JU.
Delete58% was first three months of 2014 (meaning no high season included and the notorious February included). I think there were no updates after that.
DeleteCorrect, after March 2014, no load factor data at all. I checked.
DeleteOnly for April alone, 68% LF, but our Easter was then.
ASL has better loads, and 58 % for february is decent number, combined with other months, it is easily above 70 %
DeleteS obzirom koliko više aviona ima (7 kom i samim time više dostupnih sjedala) ASL ce sigurno imati manji LF od CTN. Ako je krajem 10 mjeseca imala 2 milijuna, to je max 2.4 milijuna na kraju godine. 600000 putnika više ali i puno više sjedala, tj. mali LF.
DeleteNe, to nije način računanja. Ne računaju se avioni koji nisu letjetli, nego samo oni koji su na redovnim i charter linijama. Dakle ako je 14 aviona letjelo a 4 su čučača na zemlji gleda se koliko je sjela na ovih 14 a koliko od toga je popunjeno. Ona 4 prizemljena ne računaju se jer nisu letjela ni na jednom letu sa kodom JU u tom momentu.
DeleteAfter an 8%, the increase of 1.6% isn't as good, but it's something..
ReplyDeleteOn a side note when will the famous ASL press conference be held? The one we should hear LF, profitability and future plans on? Shouldn't it be in February?
They said late February or early March
DeleteDobro je za CTN sto je ostvario profit :
ReplyDeleteAko se nevaram i prosle godine je uradjen isto sale and leaseback samo ne znam za koji avion ako se nevaram.
INN-NS
What will they base their profit-on, once all aircraft have been leased? This looks just like buying some time, OU is dead.
DeletePisi kad imas o cemu ! Inn
DeletePa ja nista lose nisam napisao samo sam dao svoj komentar .
DeleteINN-NS
OT: How many pax to Prague today?
ReplyDeleteSo empty 737, good for the passengers. What's with the Atr's?
DeleteThey are getting them ready for the C checks. They need them ready before the summer.
DeleteVlada Srbije je danas koristila ATR za Skoplje...
DeleteIf the profit comes from summer season, I don't understand why CTN does not like other carriers (e.g. Air Malta) lease out the parts of fleet during winter, even incl. cockpit crew.
ReplyDeleteAnd/Or increase number of charter flights ex ZAG to Canary Islands, Egypt, Tunis, Dubai....to cater for some extra traffic and keep the fleet busy. Furthermore some 25% of the cabin crew could be seasonal staff. Even Lufthansa can't live with the luxury to maintain 100% fully employed staff!
First there are few problems.
Delete1. There are too many staff working for Croatian Airlines, some 100 jobs need to go, mostly high paid jobs that are not part of the core business.
2. 2 A320 and 4A319 are surplus in winters cause they're too big for Croatia's needs in winter times when load factor is lower than in summer, reason for disparity, OU often has to fly with A319 to Split or Rijeka only with 20 pax, this is massive waste of money and costs airline a lot of money, around 200 million kuna loss generated by these 6 aircraft.
3. Low winter yield for almost all destinations, generally Croatian market is slow in winters and only Zagreb has decent traffic, but heavy losses are made on domestic routes, Croatian states compensates OU to a degree as part of sustaining domestic network, but subsidy for domestic routes is less than a 5th of the actual costs are, so OU is bleeding money on domestic routes.
4. Airline has too many foreign offices and marketing costs are too great for yield indicating airline has poor strategy when it comes to marketing and online presence.
Vjerujem da OU jako loše posluje na letovima za Zadar i Pulu, ali sumnjam da imaju gubitke na linijama za Dubrovnik ili Split. Karte su preskupe, a uz to imaju i državne poticaje. Meni se prije čini da na Dubrovniku i Splitu zarađuju masnu lovom kojom pokrivaju gubitke na ostalim linijama.
Delete@AnonymousFebruary 16, 2015 at 4:21 PM
DeleteMuguče je da OU ima previše ljudi ali i letova u zimi a premalo u ljetnim mjesecima.
Slažem se da gube novce na nekim domačim linijama, Zadar, Pula, Rijeka, Osijek, Brač su prilično loše popunjene u zimi, ali mislim da problen malo u floti, OU ima dva A320 koja jedinstveno su preveliki za Hrvatske potrebe, teško može OU napuniti A320 sa 174 sjedala, pa vlak Zagreb Split nema toliko sjedala, lol
Da ne zaboroavima OU ima oko 200ak zaposlenih koji ne be trebali biti u OU jer su višak, to košta OU svake godine oko 30 miljuna kuna, baš koliko je državni poticaj za OU.
Zimi nema letova za Rijeku i Brač, a oni za Osijek, Zadar i Pulu su prepolovljeni.
DeleteLevosi za Split i Dubrovnik su stalno puni (i zimi) i cijele godine super-profitabilni iako se za njih isto dobiva PSO. Posebno ovi za Dubrovnik koji imaju popunjenost od 90 i više % i tijekom zime uz vrlo visoke cijene.
Sve u svemu dve kompanije peglaju ucinak prodajuci avione i uzimajuci ih pod lizing. Dve manje pod teretom dugova. Strasno. Siptari bankrot, Makedonci placaju subvencije. Pri tome ASL nije tome doprinela imaju oni svojih problema.
ReplyDeleteHow is flyDubai doing in Zagreb and Sarajevo?
ReplyDelete^ Add SKP and BEG to the question. How is FlyDubai doing in general in the region and what is most successful route of the 4.
DeleteConsidering how fresh FlyDubai routes to ZAG and SJJ are, I believe we should wait at least for a full year to make any conclusions. I can assume that loads are not high until later in March, which is the case for most airlines in these areas.
DeleteLF to/from Sarajevo 70%-85%
DeleteDoes anybody know how is Qatar doing lately in BEG and ZAG? I know that ZAG was doing well before, but I also heard here that average load from BEG was around 20 pax.
ReplyDeleteAlso how was Sofia doing when it was interconnected with Bucharest?? most important question actually!
If Sofia was also doing bad lets say like 40 pax, then connecting BEG and Sofia might be a disaster.
I think that in terms of passengers QR in ZAG is doing much better than in BEG, but on the other hand non stop flights offer better product and overall ZAG sees less competition to the east than BEG. I can assume that February is not bringing some spectacular loads to any airline here. For Zagreb I am fairly certain that April to Novembers means rather high loads and possibly February and March as slow periods. Sofia and Belgrade together should do reasonably well in terms of volume, but Sofia might be the one to see growth as experiencing improved product with non stop flights. For BEG nothing has really changed in terms of product offering.
Delete@AnonymousFebruary 16, 2015 at 7:59 PM
DeleteJan, Feb, and March are really bad months for Zagreb, generally speaking.
Thus year January had 150 000 pax, February will have around 140 000 pax, and March is expected around 200 000 pax, first month to do well this year in terms of pax, last year March had 175 000.
Things get in to full swing between April 1st and November 1st when numbers are above 200 000 through this period, with November last year having only 175000 and December 165 000 pax, I guess airlines can plan things around.
Zagreb traffic in 2014 in 000: (projected 2015)
Jan: 135.4 (150)
Feb: 128.4 (140)
Mar: 175.5 (200)
Apr: 192.4 (215)
May: 217.8 (250)
Jun: 243.9 (285)
Jul: 260.7 (310)
Aug: 269.7 (315)
Sep: 251.3 (290)
Oct: 226.2 (260)
Nov: 175.6 (200)
Dec: 163.6 (185)
Ne budi smesan covece ,kakva crna ,8 miliona na Zagrebu,2,5-2,6 plafon!
DeleteWhy DH8 and not CRJ900. CRJ900 is more capable and comfortable, than turbo prop.... Image you are flying ZAG-CPH with DH8 or LJU-CPH with CRJ900 its big difference. I wonder whos "strategy" was buying 6 DH8 turbo props and not aircraft with jet engine like CRJ900
ReplyDeleteTurboprops are more efficient. The difference in speed is only about 90 knots, which doesn't make much difference on most of CTN's routes considering most are rather short such as domestic routes and the routes to Germany, Austria, and Switzerland.
DeleteQ400 kosta nov 30.34 Mil USD i pritom je jako profitabilan Avion
DeleteCRJ9 kosta nov 45.83 Mil USD i nemoze se porediti sa Q400.
CTN treba menjati svoju flotu i da ima samo Q400 i BCS1 ( CS 100) i onda bi sigurno imali profitabilnost.
INN-NS
As I know turbo props are efficient at low speed, low altitude, low thrust. And jet are efficient at high speed, high altitude, high thrust.
DeletePa dobro ali recimo kombinacija u CTN airbus + CRJ900 bi bila super, em bi mogli da vozaju chartere i ostale fure. Ovako s ovim propelercem DH8 se useres vec do Beca, a kamoli sad da vozis neku klientelu charterski kao sto to cini Adria cijelo vrijeme. DH8 je da ga dignes iz zagreba i ides do pule, zadra, splita, dubvrovnika, pa cak i do braca. S takvom kantom putovati u Brisel, Copenhagen ili Skopje dobijes proljev, em lupa, em je spor. To ti je ono kad platis taxi i voze te u traktoru ili u audiju.
DeleteQ400 nije u opste spor 667 km/h i brzi je nego Atr 72-500 je 526km/h
DeleteA 320 Normal cruise speed je negde oko 839km/h
BT zahvaljujuci Q400 ima profit.
INN-NS
BT?
DeleteI have traveled with dh8 cph-zag-puy,it was a mystery how i survived the trip. It took a lot of energy but i liked it anyway!
ReplyDelete