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fastjet expects Tanzania operations to become profitable

1-Oct-2013 3:02 PM

fastjet announced (30-Sep-2013) its Tanzanian operation is now profitable on an underlying route level basis and it expects its business to become profitable at the EBIT level once scale increases with additional routes and full utilisation of resources. The airline is developing an airline management services organisation to enable the fastjet brand to be rolled out more rapidly across Africa, reduce shareholder risk and minimising capital requirements. The carrier also reported progress on restructuring its legacy Fly540 businesses. fastjet CEO and interim chairman Ed Winter said, "We are extremely pleased with our operational performance in Tanzania and the endorsement of the fastjet brand by Tanzanian consumers.  In response to our consistently high levels of operational reliability, passengers are rapidly adopting fastjet's low-cost model and booking early in order to pay the lowest prices and allowing us to yield manage to high load factors...As our planned network expansion progresses and scale covers fixed operating costs, we fully expect fastjet Tanzania to become profitable. Once Tanzania is fully established and profitable we will turn our attention again to the South African market.  Regional routes from South Africa to Sub-Saharan destinations lack effective competition and are both underserved and overpriced." [more - original PR] [more - original PR - 2]