CityJet chief expects stronger 2015 as 2014 loss narrows to €23m
Published 28/11/2015 | 02:30
Dublin-based airline CityJet has experienced a "significantly improved trading performance" this year after narrowing its losses in 2014 to €22.7m from €37m in 2013, according to founder and executive chairman Pat Byrne.
Accounts just filed by CityJet for 2014 show that its total revenue declined 20pc to €177.3m last year. The airline was sold by Air France-KLM last year to Germany's Intro Aviation, which then embarked on a cost-reduction programme.
CityJet generated revenue of €121.1m last year from scheduled flights, down from €159m in 2013. Contract lift operations resulted in €46.3m in turnover, compared to €49.6m in 2013.
Revenue from cargo and duty free sales declined to €9.8m from €11.9m. "The 2014 results were delivered at a time of significant change for CityJet," said Mr Byrne.
"While illustrating a first step on a trajectory of financial improvement for the airline, the airline did not have a sufficiently robust recovery strategy in place to effect an aggressive inroad on losses," he said.
"Changes in the senior management team together with fresh funding support has seen a focused approach to cost reduction and business development in 2015, making this a transformational year with a significantly improved trading performance."
CityJet's previous chief executive, Christine Ourmieres, left the airline last February.
Mr Byrne was reappointed to his executive role following Ms Ourmiere's departure.
Deputy chief executive and chief financial officer Michael Collins left in autumn 2014.
The accounts show that in 2014 the company paid €395,000 as compensation for loss of office to an unnamed recipient. That's in addition to a total of €1m it paid in redundancy costs. The airline relocated its commercial department from London to its head office in Dublin.
CityJet primarily operates from London City Airport, and also provides leasing services to other carriers.
It will replace its fleet of existing aircraft next year with 15 Russian-made Sukhoi Superjets. It has an option to acquire 10 additional Superjets.
CityJet wll begin using the aircraft on charter services next year, when four aircraft are delivered, and introduce it on its London City route network from 2017 when 11 more enter service. CityJet is acquiring the aircraft through a lease deal and will be the first carrier in Europe to use the jet.
Last year, CityJet did a sale and leaseback of its existing Avro aircraft. That resulted in €11.5m in additional funding flowing into the airline.
Mr Byrne said that the airline has made major changes to its scheduled network this year, eliminating loss-making routes and seeing significant growth in traffic volumes.
It also signed a so-called wet-lease agreement with Scandinavian airline SAS to operate a network of regional routes from Helsinki, Oslo and Stockholm.
CityJet has ordered eight Bombardier aircraft to operate those services. The aircraft will be operated exclusively by CityJet for SAS and will be painted in SAS livery. They'll be crewed by CityJet staff.
"The confidence of the board of CityJet in the future of the airline was clearly demonstrated in October when we placed orders for 23 new aircraft and options on an additional 16 to deliver a great future for CityJet," said Mr Byrne.
The company is also hiring staff for a new contact centre that it will open next March. The company currently employs over 650 people.