Air Malta's 1QFY2014 losses halved, but a ‘tough challenge’ remains

Air Malta Group has not made a net profit since FY2008 and then only thanks to discontinued operations. Its EU-approved Restructuring Plan targets breakeven this financial year and a positive result next year. The approximate halving of losses in 1QFY2014 demonstrates continued progress towards its goals.

Nevertheless, LCC penetration of Malta continues to grow and Air Malta has more work to do to lower its unit costs and to promote the appeal of its product and service versus LCCs. A sustainable level of profitability remains a long way off and it is highly unlikely that the EU would approve any further state aid if the carrier were to slip from its upward trajectory.

As CEO Peter Davies said: "Let me make myself absolutely clear. …we have a tough challenge to achieve the financial breakeven milestone. This requires the understanding and support of all our stakeholders including the employees, unions and suppliers amongst others".

After disputes with pilots and travel agents in recent months, this message bears repeating.