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Czech Airlines sets itself up for privatisation in 2009, even if buyers are scarce

13-Nov-2008

The Czech national flag carrier and SkyTeam member reported bullish results for the first three quarters, along with a firm outlook, implying it is largely immune to the recent downturn in market sentiment.

With a hoped-for privatisation next year, there was little danger that the government owners would be excessively generous with information.

But what was released was upbeat. According to President, Radomír Lašák, "Czech Airlines more than doubled its (before tax) profit in the first three quarters to USD22.1 million....This is a year-on-year increase of USD12.2 million at a time when the entire industry is burdened by high fuel prices and the economic crisis, and when many airlines have reported either losses or a significant deterioration in their financial situation."

This was accompanied by an operating profit for the first three quarters of USD39.15 million, up by over a third on last year's equivalent period. Passenger numbers were up and utilisation improved.

Overall revenues grew by USD 248 million, to USD 1.13 billion, with Mr Lašák noting that "(t)he year-on-year growth is also significantly influenced by the development of currency exchange rates".

Despite Czech's relatively strong showing and the undoubted value of the Prague hub, 2009 hardly looks auspicious for a privatisation. The reported likely purchasers are fellow SkyTeam member Aeroflot - not exactly humming along itself at the moment - or, potentially, a financial investor.


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