The majority of Middle East and African airline shares were down on Friday (12-Feb-2010), with 1time Holdings (+2.7%) the only carrier to close higher.
Air Arabia net profit down for FY2009
Air Arabia (-3.1%) took the biggest fall of the day, after reporting an 11.4% year-on-year reduction in net profit for the 12 months ended 31-Dec-2010, to AED452 million, despite a 14.2% rise in revenue, to AED1,972 million. EBITDAR gained marginally, rising 0.1% for the year. Load factor was also down for the period, dropping 5.0 ppts year-on-year, to 80%. However, passenger numbers increased 14.2% to 4.0 million.
US Department of Transportation proposes approval to Royal Jordanian antitrust immunity
Royal Jordanian (-2.0%) shares were also down, but could gain today (12-Feb-2010), after the US Department of Transportation (DoT) proposed at the weekend to grant antitrust immunity to oneworld alliance members Royal Jordanian, American Airlines, British Airways, Iberia Airlines and Finnair, to form a global alliance. If the decision is made final, the oneworld carriers would be able to more closely coordinate international operations in trans-Atlantic markets.
Under the proposal, the airlines must agree to conditions to protect consumers and preserve competition. The DoT noted that the alliance could harm competition on select routes between between the US and London Heathrow (oneworld’s primary hub), due to the limited availability of landing and takeoff slots and proposed that the applicants make four pairs of slots available to competitors for new US-Heathrow services. The DoT would also require changes to the agreement to ensure capacity growth and require the carriers to submit traffic data and implement the proposed alliance within 18 months of a final decision. The DoT noted the proposed alliance would enhance competition around the world by creating competition with the existing Star Alliance and the SkyTeam alliance, which already have immunity. Interested parties have 45 days to object and answers to objections will take a further 15 days.
See related article: DoT grants British Airways-American Airlines/oneworld anti-trust immunity
In Africa, Comair (-1.4%) fell, as the South African FTSE/JSE Africa All Share Index (-0.3%) was down for its third consecutive day. Kenya Airways (-1.7%) was also down, despite a gain in the Kenyan All-Share Index (+0.6%). Lonrho was flat.
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Selected African and Middle Eastern airlines share price movements (% change): 12-Feb-2010
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