in Business & Finance

fastjet announces its results for the year to December 31 2014

Posted 3 June 2015 · Add Comment

fastjet has releases its results for end of 2014.

Summary highlights

·         Significant improvement in operational and financial KPIs

·         Material corporate structure changes and improvements

·         35% first time fliers on fastjet in 2014 - African growth potential evident

·         95% customer satisfaction level 

2014 Operational highlights

fastjet Tanzania

·         85% increase in aircraft utilisation (from 5.5 to 10.2 block hours per aircraft per day)

·         62% increase in total seats flown

·         92% punctuality - SAA 84%  easyJet 85% (average arrival within 15 minutes)

·         Additional ancillary revenue streams introduced (including seat selection, 'Smartclass', and 'Freighty').

 

Fastjet Zambia

·         Zambia Air Service Permit granted - this is a significant step on the path to gaining an Air Operator Certificate and launching flights within and from Zambia.  First aircraft expected to be deployed in Q3 2015.

 

Fly 540

·         Loss-making services of Fly 540 businesses in Ghana and Angola remain suspended, now treated as discontinued - minimal cash cost in the year.

·         Disposal of investment in Fly540 Kenya - legal and financial indemnity received.

 

Subsequently (post 31 December 2014)

·         Zimbabwe Air Service Permit granted marking a significant step on the path to gaining an Air Operator Certificate and launching flights within and from Zimbabwe. First aircraft targeted to be deployed in Q3 2015.

·         Fourth aircraft lease - a letter of intent (LOI) signed for the lease of an Airbus A319 as part of planned fleet expansion. 

2014 

fastjet Tanzania

·         106% increase in full year revenues to US$53.8 million ( 2013 US$26m)

·         26% increase in average revenue per passenger to US$90 (2013 US$71)

·         64% increase in passengers carried

·         3% increase in Revenue per Available Seat Kilometer (RASK) to 7.95c (2013 7.72c)

·         20% fall in Cost per Available Seat Kilometer (CASK)to 11.27c (2013 14.13c)

·         Full year underlying operating loss before exceptional items of US$22.5 million

·         Full year underlying operating loss after exceptional items of US$24.4 million - US$1.9 impairment on intangible items

·         50% reduction in year on year EBITDA loss margin.

 

fastjet Group

·         Operating loss before exceptionals US$30.7 million

·         Operating loss after exceptionals US$43.9 million - impairments of US$10.7m intangibles and termination of  easygroup management contract of US$2.5m

·         Loss including discontinued businesses US$72 million - loss from Fly 540 Angola and Ghana US$27.7 with less than US$0.25 million of fastjet Plc cash used in these legacy operations.

 

Subsequently (post 31 December 2014)

·         £50 million equity fund raise, significantly broadening the institutional shareholder base.

·         Share capital reorganisation - consolidation of ordinary shares on the basis of one new share of £1 each for every 100 shares of 1p each.

 

Restatement

·         Restatement of 2013 financial statements in relation to the 2012 purchase of the Lonrho aviation business. The transaction was treated as an acquisition by Rubicon (now fastjet Plc) whereas it is more correctly treated as a reverse acquisition by Lonrho, as whilst the Lonrho board in practice did not, it could have sought control of the Company. The restatement has neither any cash effect on any of the years concerned nor any material impact on the 2014 trading results.

 

Outlook

·         Significant growth in fastjet year-on-year passenger numbers expected to continue, with the level of passenger numbers achieved reinforcing fastjet's stronghold in the Tanzanian market, and the attractiveness of both the low-cost fare structure and operational reputation.

·         Growth for 2015 expected to come both from the Tanzanian operation and from the addition of new fastjet airlines in Zambia and Zimbabwe.

·         Current fleet is now nearly fully utilised - extra capacity is required with a fourth aircraft due to join the fleet in Q3. The aircraft in question will be the first of a number of aircraft that fastjet is planning to add to the fleet this year, with each additional aircraft able to make up to 1,000 more seats per day available to customers. Based upon the 75% load factors currently projected, each aircraft in the fleet is expected to carry approximately 275,000 passengers per annum.

·         Negotiations on further aircraft underway with target to build a fleet of up to 34 aircraft operating to 40 destinations within and from Tanzania, Zambia, Zimbabwe, South Africa, Kenya and Uganda by the end of 2018. 

Ed Winter, fastjet Chief Executive Officer, said: "2014 has seen a significant increase in the number of passengers travelling on our core Tanzanian routes, with revenue more than doubling. Aircraft utilisation grew sharply and average revenue per passenger also climbed with our services such as seat selection proving increasingly popular with customers. 

"Strong underlying traffic growth during the year continues to demonstrate that fastjet's low-cost airline model works in the African market. This growth in traffic underpins our belief that people across Africa are increasingly embracing the travel opportunities offered by fastjet's safe, reliable, and great value product, with a high percentage of first time fliers.

fastjet continues on its path of expansion, with new routes in Zimbabwe and Zambia planned in 2015. I look forward to this coming year with great confidence as fastjet leverages its first mover advantage to the benefit of our customers and shareholders

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