On May 10th, Jazeera Airways released its earnings figures for the first quarter of 2021. With the ongoing health crisis and tight travel restrictions imposed by the Kuwait government, the airline is still facing losses. However, when compared to the first quarter of 2020, the airline experienced a smaller loss. This was achieved by trimming the airline’s workforce and operations, as well as the absence of a total ban, as was experienced in Kuwait the year prior.
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First-quarter earnings for 2021
Announcing its figures yesterday, Jazeera Airways posted an operating revenue of KD8.1 million ($26.92 million).
When matching up operational revenue with operational expenses, the airline registered a net loss of KD5.2 million ($17.28 million). While not an insignificant figure, it does represent an improvement of 14% from the first quarter of 2020- which saw a net loss of KD6.0 million ($19.94 million).
One big change from a year ago was the difference in travel restrictions and the airline’s ability to adapt. In March of 2020, with the health crisis just emerging, most airlines were caught off-guard. The Kuwaiti government imposed a complete ban on all commercial traffic, allowing only cargo operations and specially arranged repatriation services. This time around, Jazeera Airways has had the chance to right-size its workforce and its operations.
Additionally, Kuwait now has a slightly less restrictive flight policy. Rather than a blanket ban on all traffic, commercial flights from 35 countries are suspended at Kuwait International Airport. Since February 7th, 2021, the government has also imposed an arrival capacity of 1,000 Kuwaiti nationals per day.
Passenger traffic numbers
The airline reports that the number of passengers flown during the quarter reached 104,116- which is down from 496,484 during the same period in 2020. This is due to ongoing restrictions at Kuwait International Airport (KWI).
The airline’s load factor was 58.4%, while its yield increased by 105.2% to KD74.9 ($249).
Jazeera Airways’ chairman credits some of its passenger traffic to connecting flights, as well as new destinations (with more on the way):
“While restrictions continued at Kuwait International Airport during the quarter, Jazeera focused on connecting flights, targeting underserved segments of passengers within its network, which accounted for 28% of total passengers. The airline also launched two new destinations and acquired six new traffic rights as it prepares to launch new routes in the summer season. Overall, Jazeera acquired the largest market share at KWI during the month of March despite limited capacity.” -Marwan Boodai, Jazeera Airways Chairman
Positive news during the first quarter
Indeed, the airline has had some positive news during the quarter. It launched two new routes to Colombo, Sri Lanka, and Addis Ababa, Ethiopia. “These routes serve a resilient demand for travel by expatriates in the region,” the airline states.
During the period, the airline also took delivery of its sixth Airbus A320neo aircraft. In total, four A320neos will be delivered over the course of 2021.
The airline expects restrictions at Kuwait International Airport to be lifted over the remainder of the year – particularly as vaccination rates improve.
The airline’s chairman concludes by saying that Jazeera is in a strong financial position with an experienced team. “The airline has a solid portfolio of travel rights, an efficient fleet, and a network that connects passengers from point to point,” he adds.
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