Airline projects profit dip

Captain Savy addresses the Air Seychelles staff Wednesday

Air Seychelles estimates profits for its 2003-2004 fiscal year at around R4 million which would be a R10 million drop from the previous year.

This was announced on Wednesday June 2, at the airline's annual general meeting (AGM). The figures have yet to be audited however, and are not official.

In March this year, the airline announced an official profit of R14.6 million in its annual report for 2002-2003, after tentative figures from its last AGM in July projected profit at about R10 million from that same period.

If the R4 million projection is accurate, the 2003-2004 fiscal season, which ended on May 31, will be the sixth straight year of profit for the company after suffering losses of a combined R80 million during the fiscal years ending in 1997 and 1998.

The national carrier’s executive chairman, Captain David Savy, told his staff on Wednesday at the International Conference Centre that the profit figures came during a period of continuing difficulties for the airline industry worldwide, compounded by local factors such as the introduction of the 12 percent Goods and Services Tax (GST).

Captain Savy said that despite a year in which passengers transported on international networks declined by 3.6 percent, in addition to an 11.7 percent decrease on domestic routes largely attributed to GST and surface competition, Air Seychelles performed relatively well even with the profit projections being lower than last year.

He also tabbed the Sars epidemic, which halted Air Seychelles flights to Singapore for three months at a price tag of R6 million in lost revenue, as well as a nearly 21 percent decrease in cargo volume, for the profit dip.

The airline was able to survive, Captain Savy said, mainly due to the favourable exchange rate between the US dollar and the Euro, as well as “the dedication and hard work of our staff.”

But the airline chief predicted a potentially gloomy period for Air Seychelles in the year ahead.

Citing skyrocketing fuel prices as well as the appreciation of the dollar versus the Euro, Captain Savy said the upcoming year would probably be “one of the toughest” since his tenure began as chief executive.

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