South African Airways (SAA) reported (15-Oct-2012) an operating loss of ZAR1.3 billion (USD147.45 million), revenue of ZAR23.8 billion (USD2.7 billion) and irregular expenditure of ZAR128 million (USD14.5 million) for the year ended Mar-2012. The airline's revenue increased 5.3% from ZAR22.6 billion (USD2.56 billion) in the previous year. South Africa's Minister for Public Enterprises Malusi Gigaba said a task team was established to develop a strategy to make the airline financially viable and independent of Government support in the medium to long-term. The team will include SAA chairman Vuyisile Kona, SA Express CEO Inati Ntshanga and Mango CEO Nico Bezuidenhout and is scheduled to deliver a report by 15-Dec-2012. Mr Gigaba said the airline performed "below expectation" and the financial results reflected "weak internal controls." Mr Gigaba also said there were no plans to privatise the carrier. [more - original PR]
SAA announces FY2011/12 results, establishes team to restore financial viability
You may also be interested in the following articles...
Finnair and TAP Portugal: their location based long haul niche strategies compared
Both Finnair and TAP are based in peripheral corners of Europe: Finnair in the extreme northeast and TAP in the southwest. Both are based in countries with relatively small populations, but they have developed networks that capitalise on their geographic location to carry connecting traffic from across Europe and elsewhere to long haul destinations in other continents.
TAP's main long haul market is Upper South America (primarily Brazil), but it also has a secondary long haul niche in Africa. Finnair's main long haul market is Northeast Asia, with an additional presence in South and Southeast Asia. Both also operate to the US. On short haul, LCC competition has been a bigger threat to TAP than to Finnair, but cost savings are important to both.
TAP and Finnair have similar traffic volumes, unit costs and average trip lengths. Moreover, both have struggled to generate sustainable profitability. This report compares and contrasts Europe's two leading independent exponents of the location based long haul niche strategy. Both are set to accelerate their long haul growth.
Africa's struggles continue as economies weaken and competition intensifies
Africa remains a region with huge untapped potential – as it has for many years. The long term outlook for growth is always bright, particularly if the Yamoussoukro Decision were to be implemented, bringing long overdue liberalisation.