Montenegro to lease jet, posts best result in decade


Montenegro Airlines is set to wet-lease a Boeing 737-500 aircraft for the summer season after posting its smallest annual loss in ten years. The Montenegrin carrier will utilise a 126-seat B737-500 jet from Romania's Blue Air. According to the Romanian "Boarding Pass" portal, the aircraft, registered YR-AMC, will be stationed in Podgorica from April 15. It is expected to operate on behalf of the Montenegrin carrier until the end of September in order to support the company's summer schedule. Last year, Montenegro Airlines wet-leased the same aircraft type from Malta's Air X Charter. "Leasing an aircraft for a longer period of time during the peak summer months proved to be extremely successful and efficient", the airline previously said.


Montenegro Airlines posted a net loss of 1.97 million euros for 2018, the smallest amount in ten years. The result marks an improvement on 2017 when losses totalled 4.6 million euros and 2016 when they amounted to 11.5 million. The company said its operating income was 245 thousand euros higher than its operating expenses. Overall, revenue stood at eighty million euros. The improved results were achieved despite a 27% increase in fuel prices. "At the start of 2017, the airline was in an almost hopeless situation, with a loss of 11.47 million euros from 2016. Following measures which were undertaken by the new management, with support of the Government of Montenegro, the business was stabilised in a relatively short period of time. By the end of 2018 losses were almost six times lower", the carrier said. It anticipates posting an annual profit in 2019.

Commenting on the results, Montenegro Airlines' CEO, Živko Banjević, said, "It is evident that the company would have operated with an overall positive result in 2018, despite significant financial expenses, which primarily relate to exchange rate differences, had the price of fuel been lower. Due to these unforeseen circumstances, last year we had to allocate an additional 3.2 million euros than initially planned. In any case, the positive trend in Montenegro Airlines' operations is evident over the past two years. If the price of aviation fuel remains at the same level as it was in the first quarter of 2019, we can hope for a positive result at the end of this year, which will be better than the previous one according to all commercial and financial indicators".




Comments

  1. Congratulations Montenegro Airlines.

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    1. Congrats for a financial loss? Hahahaha never heard of this type of praise.

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  2. Nice. I hope they apply the MGX livery to the leased plane like last year. The blue cheatline is already there :)

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    1. Yes the livery would fit perfectly. It would just have to be a lighter shade of blue, like their actual livery on the Fokkers and Embraers.

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    2. The aircraft will fly with BMS livery, maybe they will add a sticker as they do with the aircraft which fly for LOT :)

      Gabriel @BoardingPass.ro

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    3. Pity but thanks for the info.

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    4. That's unfortunate. I loved the B737 in Montenegro's livery last year. Looked great.

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  3. I'm glad the losses are decreasing but the question is how much state aid they received in 2018.

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    1. Whatever they got it is better to give them state aid now when they are still not in the EU and are more or less allowed to do it than for the entire airline to collapse the second they enter the EU.

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    2. I'm getting the impression that the management knows what's it doing. They seem to have made some good decisions and if they managed to get the government to give them money then so be it.

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    3. In 2017 they got 15 million EUR state aid. I don't know the figure for 2018. In December 2018 government approved 5.5 million for MGX for 2019.

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  4. Thank God that they got rid of that corrupt woman! Still, these results might be good butvtheir debt is so high that this is simply not enough, especially now with LCCs adding flights on a daily basis.

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    1. Do you mean Daliborka? Where is she now?

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    2. Don't worry about Daliborka. She is a member of parliament.

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  5. So finally this year MGX will probably be in profit. Well done.

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  6. I think Montenegro Airlines has the best chances of being properly privatized out of the ex-Yu airlines. Is the government still interested in selling them?

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    1. 4K was interested but then they gave up on the idea considering the mess they are in themselves.

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    2. The problem with MGX and privatisation is that it is too small. There is nothing an airline could gain out of buying into it. An exception is if it is some non-eu airline that wants greater access to the EU market without all the bureaucracy.

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  7. The only full service legacy airline in ex-Yu. Hopefully next year they can lease a 737-800 or maybe A319. Otherwise the aircraft itself is 28 years old first delivered to LH back in April 1991 as D-ABIP.
    In other words, this is a Lufthansa jet.

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    1. I'd much rather fly on a well maintained 28 year old 737-500 than a brand new 737 MAX. ;)

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    2. BMS will retire all their classics by the end of the year.

      Gabriel @BoardingPass.ro

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    3. They were talking about getting bigger plane for summer. and they go and get a large, heavy, old, very thirsty plane with the same capacity as their Embraers.

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    4. If the lease rate is good then why not?
      Plus this year fuel prices are much lower than in 2018.

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  8. They seems to be the best run airline in ex-YU and that says a lot.

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  9. This aircraft is oooold.

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    1. The one they leased last year was hardly a spring chicken either.

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    2. The curious thing is that this beauty flew for LH for nearly 25 years!! Those were the days when true planes were made to fly and built to last.

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    3. Well at least we know it was well maintained if it was with LH for so long.

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  10. I'm glad they managed to decrease losses. Hope their debt decreased too,

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  11. Next year should be very interesting to see what they choose to do with their fleet. They will have to get rid of the Fokkers.

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    1. I won't be surprised if they decide to buy the new Embraer E2 jet.

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    2. I highly doubt they will have the money for E2.

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    3. It would make more sense for them to become an all Embraer operator in my opinion. It would reduce costs.

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    4. They probably couldn't afford a downpayment on Embraer.

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  12. Nice news coming from Montenegro Airlines lately. Yes it is a loss but a good improvement. They could manage around 1 million profit this year.

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    1. The airline has potential.

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  13. Looks like YM has the better financial performance of all the ExYu airlines!

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    1. They managed these results because of state aid.

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    2. If it wasn't for state aid JU or OU will have been long gone.
      All of them receive state aid but YM seems to be know the least dependent on it.

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    3. From what do you deduce that they are "least dependent on it"?

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    4. JU depends entirely on Abu Dhabi and is in private hands. Not the case with YM, though.

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    5. Anonymous at 09:32
      From having by far the smallest losses by all exyu airlines.

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    6. We can't conclude anything until we see their KPI's which they have not made public.

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  14. Great but all of this should have been done 5 years ago. They are facing a lot of competition now. Wizz Air and Ryanair are growing, TUI is taking part of the cake from France and the UK, Lufthansa has arrived in TIvat...

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    1. I think this is the reason the government got its act together and realized that they need to drastically change something at YM in order for it to survive.

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    2. You forgot the arrival of Lufthansa in TIV this summer.

      Munich - Tivat
      April 13 - Lufthansa

      Frankfurt - Tivat
      April 14 - Lufthansa

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    3. Well I did say "Lufthansa has arrived in TIvat..." ;)

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    4. Oops, apologies mate :D
      Congratulations for the progress of your country.

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  15. Do we know which routes the B735 will be deployed on?

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    1. I think they send it on all destinations. There is no particular rule.

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    2. I think we will see this plane on Belgrade flight and maybe some of their charter flights.

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    3. It was scheduled on most routes last year but went to Belgrade the most. It only couldn't go to Russia.

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    4. Why couldn't it go to Russia?

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    5. Plane registration, it's was from Malta. Same issue will be with the Romanian 737.

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    6. Why is that an issue?

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    7. Air agreement between Russia and Montenegro. Only carriers based in MNE/RUS and planes who has registration 4O/VP can operate flights between two countries. 737-500 is registered in Malta

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    8. Some time ago JU was not allowed to fly to Germany with UAE registration. Later on these planes became YU-API and YU-APJ.

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  16. So now we are waiting for financial results of Air Serbia and Adria for 2018.

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    1. JU's will be published in June, Adria's in September.

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    2. Adria might not be around in September anymore.

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  17. Nice good luck MGX.

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  18. Will the crew be Romanian?

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    1. I would assume so. But last year they had Maltese crew + crew from Air Serbia working on loan for a few months.

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    2. Interesting

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    3. Yes and the pay offered to JU crew was very high.

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    4. Are they doing the same this year? I mean with the Serbian crew?

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  19. I have always been a fan of Boeing. Pity it's only staying for a couple of months.

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    1. Well its staying for an ideal period of time - during the summer rush.

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  20. Not much seat difference between the EMB and B737.

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    1. Well the 737-500 is the shortest and smallest member of the second generation 737-300/-400/-500 family and the last to be developed.

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    2. They could lease B732 it's probably cheaper.

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  21. To me it seems like YM is improving and is on the right track.

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    1. Well after Daliborka some positive change was bound to happen.

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    2. What's wrong with Daliborka? It's not her fault..

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    3. She did a stellar job :D

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    4. She inherited most of the mess from her predecessor. It wasn't so much her fault.

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  22. Any pic of the interior of the plane?

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    1. I think it still has the Lufthansa grey seats.

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    2. Ok, that would be good.

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    3. It seems to be the thin Recaro seats in grey:
      https://youtu.be/jHQcW_5vXTQ (40s)

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  23. Nice changes at MGX lately. Better financial performance, nice new look website, great looking uniforms, new routes. And they are still a full service airline. Well done.

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  24. Great to see improved results from YM.

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    1. I'm happy too, I just hope all these numbers are factual. Remember how they used to post fantastic results in 2010, 11, 12 and it turned out to all be falsified?

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  25. Bravo Crna Goro!

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  26. I would love if they resumed flights to PRN, INI and SKP.

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    1. They won't return to INI. Air Serbia will get subsidies to fly INI-TIV.

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    2. Air Serbia has no planes for this adventure.

      If JU was meant to be involved it would be logical BEG-INI to be announced. As we have no BEG-INI in the offer it is not logical e JU to get INI-TIV

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  27. Good news for Montenegro airlines and the state of Montenegro. Air transport is significant for entire tourist industry and state economy

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  28. The financial results are quite vague. But I'm happy they are improving.

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  29. They have to work on seasonality issue with the government and the tourist board.

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    1. I wonder who has the bigger seasonality issue. Montenegro airlines or Croatia airlines?

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    2. Having the TGD-BEG and TIV-BEG route helps a lot with seasonality, especially TGD-BEG-TGD which performs equally well in summer and winter.

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  30. Is Montenegro going to be influenced by the rise of the Turkish tourist market? Russians are expected to flock to Antalya and co due to the low prices and airline subsidies from Turkey...

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  31. It seems that France flights are really popular fromm TGD and TIV!

    https://montenegroairlines.com/Data/Files/montenegro_airlines_ljetni_red_letjenja_2019_en.pdf

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    1. Lots of French tour groups coming.

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    2. Yeah ? I see from LYS there are regular flights too!

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  32. Bravo Montenegro Airlines! I hope they manage to come on the right track financially this year.

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  33. It is still getting massive subventions from the GoM.

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    1. All airlines in ex-Yu do. Even those that claim they don't.

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    2. You mean OU?

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  34. MGX should lease seasonally a widebody and start TIV-JFK flights. The market is there. They planned to do this in the 90s with a B767.

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    1. With American Airlines 40 km to the North it would take miracle for any US destination with MGX to happen. Plus it's not only the good will - both the country and the company must fulfill very tough FAA criteria in order to commence the flights to the US and I'm not sure if that is the case with Montenegro.

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  35. This 737 has 126 seats. Tender for INI-TIV service requires a plane with at least 125 seats. Coincidence?

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    1. Yes it is a coincidence. To get those subsidies you also have to have an extra plane based in Serbia, which Montenegro Airlines does not.

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  36. A loss is a loss however they slice it. There is not much to be proud of. Neither the financial result nor the ancient and less economical version of the 737 they will lease.

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  37. This B737-500 will be in MGX, for a month or so, then will be changed with 737-300, witch will be flying for MGX until Oct...

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