Royal Jordanian achieves quantum leap with JD21m net profit in 2015

AMMAN — Royal Jordanian (RJ) announced on Tuesday in a press statement that it registered a JD21 million net pretax profit in 2015. 

The company ended 2014 with a JD49.5 million net loss before tax.

According to audited financial results, endorsed this week by the board of directors, RJ's net profit after tax stood at JD16 million, while in 2014 the company's net loss amounted to JD39.6 million.

RJ Chairman Suleiman Hafez attributed the growth to the efficiency and loyalty of the staff, and to the company's keenness to implement the 2015-2019 business plan.

"The plan focuses on constant renewal of the fleet and review of the route network, restructuring in all areas, taking measures to increase revenues and reduce operating costs, and working to increase the company’s market share," the press statement said.

It added that RJ will be looking for available growth opportunities, all the while improving the quality of services and maintaining the airline's leading position in the Levant.

Expressing satisfaction with the positive results, Hafez described the performance as a quantum leap, particularly at this point in time when air transportation is strongly affected by regional instability.

"Turbulence in Jordan's neighbouring countries negatively influences travel and tourism both to the Kingdom and the Middle East, " he said in the press statement, stressing that these positive results achieved will help the airline continue the current restructuring process.

The chairman indicated that in the first nine months of 2015, the company registered JD27 million pretax profit.

"Air traffic is seasonal in nature," Hafez explained in the press statement. "Normally airlines, RJ included, achieve better financial results in the second and third quarters, which witness active traffic, particularly during the summer season."

Although the first and last quarters of each year usually see a drop in the number of travellers, the chairman added, the airline achieved JD21 million at the end of 2015.

He credited the airline's policy of cost control for reducing the operating cost last year to JD559 million in 2015, a 22 per cent drop from the JD715 million in 2014.

The chairman said the fall in fuel prices last year partially offset the drop in revenues; that was due to lower ticket prices imposed by fierce competition in the sector. 

"The lower fuel prices also helped offset some of the JD12.3 million losses incurred due to suspending destinations like Sana’a and Aden for security reasons," he elaborated.

Hafez underlined operating efficiency as an important factor for reaching the positive results. RJ shut down a number of stations in light of their weak economic feasibility and, consequently, reduced the number of its aircraft. 

The stations are Delhi, Mumbai, Colombo, Lagos, Accra, Milan, Alexandria and Al Ain.

At the same time, RJ started reaching new destinations, like Tabuk, Najaf, Ankara, Jakarta and Guangzhou, the last launched this month .

Hafez highlighted RJ's increased flights frequency to certain destinations in response to the greater demand for travel, particularly in the peak seasons.

For instance, the flights to Aqaba increased from 11 to 16 weekly, with changes to the flight schedules to meet passengers’ needs.

Flights to eight destinations are still halted due to security reasons; they are Damascus, Aleppo, Mosul, Tripoli, Benghazi, Misrata, Sanaa and Aden. 

"RJ is a prominent Jordanian success story that owes its accomplishments to employees’ capability and expertise, which helped it overcome difficulties throughout its history," the chairman said in the press statement. 

He stressed that RJ is constantly looking for new and promising opportunities to increase revenues, enhance competitiveness and improve air and ground services in a way that enables it to run safe and seamless flights and to achieve its vision of being the airline of choice that connects Jordan and the Levant with the world. 

"The airline staff members are determined and dedicated to continuing to improve the company's overall performance in order to meet its aspired goals," concluded the chairman, who also expressed RJ's pride in being the national carrier of Jordan under the leadership of His Majesty King Abdullah Bin Al Hussein, and one of the country’s economic pillars and major contributors to the nation’s progress at all levels.