14-Sep-2016 11:04 AM

Comair reports declining domestic revenue in FY2016, economic pressures to continue in FY2017

Comair (South Africa) reported (13-Sep-2016) declining revenue in South Africa's domestic market in FY2015/16, exacerbated by the weak economy. The airline said FY2016 was characterised by overcapacity in the LCC segment, which led to 10% growth in the domestic passenger market. CEO Erik Venter attributed growth in revenue and passenger volumes largely to the strength of the kulula.com and British Airways brands and the company's focus on customer service. Both brands achieved their on time performance target of 85%. The international inbound market partially recovered following the relaxation of visa regulations and the weakening of the rand improved revenue from overseas sales. Non-airline revenue, including flight training, travel product distribution, catering and airport lounges increased 6% and contributed 18% of profit from operations. The weakening rand negatively impacted USD-denominated costs, but was offset by lower fuel prices. Profit after tax declined as a result of the volatility of the rand and unrealised exchange losses. Mr Venter said the weak economy is expected to continue to pressure consumer spending and industry margins in FY2016/17, despite recent growth in passenger numbers. [more - original PR]

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