Air Berlin announced first elements of a restructuring program
Air Berlin achieved a slightly improved operating result (EBIT) in the second quarter of the year with turnover up by 2,9% to 1,146.4 million euros. Compared to the same quarter of the previous year, airberlin was able to improve EBIT (Earnings before Interest and Tax) to -6.9 million euros from -8.1 million euros in the previous year. Taking into account other operating income of 4.8 million euros (previous year 39.2 million euros) the annual comparison on operating level shows an improvement of more than 35 million euros. Net profit was with 8.6 million euros, an increase of 46.6 million euros on the previous year (-38.0 million euros).
Following a successful recapitalisation program, Air Berlin has liquid assets in the amount of 600 million euros cash on hand and nearly 300 million undrawn cash facilities available. Compared to year-end 2013, available cash increased by 378 million euros. Following the injection of the subordinated perpetual convertible bonds equity, increased by nearly 130 million euros compared to the end of the first quarter 2014 and stood at -270 million euros at the end of the second quarter. As a reporting date under IFRS, the equity capital has no effect on the financial operation of the company.
Air Berlin also a nnounced first elements of a restructuring program:
- Focused network: Air Berlin will focus on the largest travel markets in the DACH region (Germany, Austria, Switzerland) as well as Palma de Mallorca and connect these high volume routes with high frequencies in point-to-point traffic.
- Closer cooperation: closer cooperation with Etihad Airways and its network partners. As a next important step Air Berlin is in a process of putting together a framework for a close bilateral cooperation with Alitalia, subject to regulatory approvals.
- Narrow body fleet harmonisation: In order to achieve a more efficient operation airberlin will strive for narrow body jet fleet harmonisation in its entire network.
- Streamlining operating platforms: Air Berlin is in a process of streamlining and restructuring the operational platforms it uses (AOCs). In line with network adjustments, it intends to reduce its fleet by approximately 10 aircraft.
- Close down of crew stations: Air Berlin has decided and agreed after negotiations to close down five of its smaller crew bases. This measure affects the work location of pilots. This does not mean that these airports are not served by Air Berlin anymore.
CEO Wolfgang Prock-Schauer said: “We will announce further details and the complete range of measures at the end of September. The entire program is aiming to move us into sustainable profitability. Our guests and partners can rely on the fact, that airberlin will continue to have a competitive offer in Europe, and remain a prime partner for tourism and long haul travel.”