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1time performs ‘well’

posted Mar 18, 2011, 1:35 AM by Rowan Hewitt

18 Fri, Mar 2011

IN releasing its financial results for the period ending December 31, 2010, 1time Holdings reported mixed results for its different divisions.

1time Airline “performed well” with R66,9m headline earnings, while Safair Technical, the aircraft maintenance business, performed poorly with a R22,6m attributable headline loss.

Group revenue increased by 4,6%, supported by higher passenger volumes and higher yields in what the group describes as “tough market conditions”.

1time Airline increased gross revenue by 10,3%, from R1 040m in 2009 to R1 148m in 2010.

In a statement the group said: “The airline maintained its status as the fastest growing airline for seven years in a row, increasing passenger volumes by 6,7%. Capacity increased by only 5% to increase the average load factor to 82%.”

The group continued to report that the African growth strategy had proved successful with the Zanzibar, Livingstone and Maputo routes all performing well along with the eight domestic destinations currently serviced by the airline.

According to the group, the 2010 Fifa World Cup had no material impact on the airline’s earnings for the period. While demand increased during June and July 2010, this was offset by an “abnormally poor” demand during May and August.

Revenue growth for the airline in 2011 will be focused on growth on current routes, expanding into Africa as and when these routes become available and introducing services from Lanseria airport subject to market conditions.

The group’s fleet review process included international comparatives and has indicated that the MD80-type aircraft continues to offer the lowest seat-kilometre cost in the domestic market, combined with a premium carrier service experience. The airline currently operates a fleet of 12 standardised MD80 aircraft operating around 1 300 flights

The 1time charters division performed well during the World Cup, offering charter air services to foreign supporters, groups and tour operators. Fleet capacity in the second half of the year was, however, constrained as the fleet was geared toward the airline’s African growth strategy.

The 1time holidays division increased revenue from R4,2m in 2009 to R14,9m in 2010. Further revenue growth is expected during 2011, particularly as the group will focus on selling holiday packages to its African destinations that are currently served by 1time Airline.

Looking forward, the group expects a tough trading environment for 1time Airline. High oil prices will put pressure on yields, which will in turn negatively impact overall market volumes.

“We are confident, however, that our low-cost advantage will enable us to continue offering the lowest prices and best service,” said 1time ceo, Glenn Orsmond.

Further passenger growth is expected on current routes and new services into Lanseria and Africa.