SAA profit down 70% on fuel

JOHANNESBURG – Annual operating profit at state-owned South African Airways tumbled by 70 per cent due to soaring fuel prices and a strike, former parent Transnet said yesterday.

Operating profit for the 12 months to March slid to 300 million rand from one billion rand the previous year, state transport group Transnet said when releasing its own results. The airline, which was transferred out of Transnet to the government at the end of March, will release detailed profit figures tomorrow, but Transnet provided some figures during a presentation of its own results.”It (profit) pulled back this year to 300 million primarily due to increased costs,” said Transnet Chief Financial Officer Chris Wells.Fuel costs surged by 51 per cent, while a strike that lasted nearly a week in July 2005 and lower yields also hurt profits, he added.SAA revenue rose 12,5 per cent to 19,6 billion rand, but 600 million of the gain was due to an additional release of provisions for air traffic liability of 600 million rand, Wells added.The flag carrier reported a 240 million rand operating loss in the first half, mainly due to high oil prices and the strike that cost it 100-150 million rand.Following the removal from Transnet, the airline’s management reports to the Department of Public Enterprises.- Nampa-ReutersThe airline, which was transferred out of Transnet to the government at the end of March, will release detailed profit figures tomorrow, but Transnet provided some figures during a presentation of its own results.”It (profit) pulled back this year to 300 million primarily due to increased costs,” said Transnet Chief Financial Officer Chris Wells.Fuel costs surged by 51 per cent, while a strike that lasted nearly a week in July 2005 and lower yields also hurt profits, he added.SAA revenue rose 12,5 per cent to 19,6 billion rand, but 600 million of the gain was due to an additional release of provisions for air traffic liability of 600 million rand, Wells added.The flag carrier reported a 240 million rand operating loss in the first half, mainly due to high oil prices and the strike that cost it 100-150 million rand.Following the removal from Transnet, the airline’s management reports to the Department of Public Enterprises.- Nampa-Reuters