Mauritius: Air Mauritius posts negative financial results

Port-Louis, Mauritius (PANA) – The Mauritian national airline, Air Mauritius, Friday posted negative results of 2.7 million euros for the last quarter of 2014 for a total revenue of 123.7 million euros as compared to profits of 8.6 million euros for the same period a year earlier.

In a communiqué issued in Port-Louis, Air Mauritius said major financial factors and evolutions in the operating environment have significantly impacted the results - namely a sharp drop of the euro, intensifying competition and the slowdown of growth on its destinations in China.

“The drop of the euro has prevented Air Mauritius from taking full advantage of the drop in the price of crude oil which was at US$89 a barrel for the quarter as compared to US$110 a year before," it indicated.

During the quarter, Air Mauritius offered 529,069 seats across its network, representing a year on year growth of 1.9%. However, it said, “demand did not follow suit and the load factor dropped from the 77.5 % to 73.1 % for the quarter.”

This is partially due to intensified competition on the Mauritius destination with competitors significantly increasing the number of seats offered, particularly on certain destinations, while undercutting prices.

Air Mauritius also said that growth rates on direct routes to China were below forecast.

“Air Mauritius offered 12,206 additional seats on Chinese destinations for the quarter representing an increase of 53% but there was no corresponding growth in demand," it emphasized.

Moreover, it added that the load factor on China for the quarter thus dropped from 78.6% to 52.6% which resulted in a significant loss for the company”.

It said the company took a series of initiatives to manage costs and overheads.

“Air Mauritius is preparing to take delivery of its new fleet as from 2017. This will enable the company to offer a significantly improved product and present a considerable potential for efficiency gains that will ensure the long term sustainability of the company," it added.
-0- PANA NA/VAO 13Feb2015

13 february 2015 14:17:00

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