JOHANNESBURG – Diversified airline Comair yesterday announced record earnings despite dismal trading conditions that include poor economic growth, rising fuel prices and a domestic market characterised by surplus capacity.
The group said its non-airline businesses of Food Directions, SLOW lounge, flight training academy and IT all contributed as net profit before tax, helping earnings a share increase 10 percent to 69.8c a share.
Headline earnings a share increased 4 percent to 69.5c, surpassing the previous 67.
Profit after tax rose to R326 million compared to the prior year while generated cash from operating activities hit R946m, resulting in a closing cash balance of R685m, enabling it to declare a final gross cash dividend of 17c per ordinary share.
“Our continued investment in efficiency, innovation and diversification have helped the business thrive despite a moribund economy and an increase in the fuel-price of nearly 15percent,” chief executive Erik Venter said.
The airline said it invested R46m on its aviation training facility, R41m on the lounge business and R54m on technology solutions.
The aviation training facility was recently outfitted with a R21m Airbus A320 fixed-base trainer along with the completion of a third simulator training facility completed by financial year-end.
Venter said it was negotiating the acquisition of a further two full-motion simulators to capacitate the Rhodesfield facility, which attracts pilot and cabin crew trainees across the globe.
“Our simulators run around the clock to accommodate and train personnel from 36 airlines, so we’re adding four simulator bays to create the necessary capacity for expansion,” he said.
Comair also acquired EPT Aviation Training, and Global Training College South Africa as well as Metaco Holdings, which focuses on leadership development and change management during the period.
The catering subsidiary Food Directions also embarked on an expansion programme at its Anchor Industrial Park facility. It has won two concessions for extending its business: a licence to provide catering to third-party airlines, and a tender to provide lounge food and beverages for British Airways at both OR Tambo and Cape Town international airports.
Additionally, Food Directions has been awarded the catering for the group’s SLOW lounge network.
Venter said Comair would invest R54m on improved technology to enhance the group’s operating performance, customer service and revenue generation.
Comair closed flat on the JSE yesterday at R4.58.