Ethiopian Airlines Stays Profitable Despite Covid-19 Travel Bans
Ethiopian Airlines Stays Profitable Despite Covid-19 Travel Bans
Ethiopian Airlines Group, Africa’s largest and only consistently profitable carrier, expects to stay in the black for the fiscal year that ends next week, even after the coronavirus upended the global aviation industry.
“We may not be as profitable as we expected but we registered some profit,” Chief Executive Officer Tewolde Gebre-Mariam said in an interview. “The first half of the year was good and the cargo business has also done very well.”
Revenue generated from the transportation of goods has allowed Ethiopian to keep up monthly fixed payments of $120 million to $150 million, including servicing loans, aircraft leases, salaries and rentals, the CEO said. The carrier is still flying about 40 charter repatriations a week while commercial flights are mostly grounded.
The airline still expects to be down almost $1 billion in ticket revenue for the year ending July 7. That’s in line with carriers worldwide, which are expected to lose a combined $84 billion this year, The International Air Transport Association said earlier this month. Many have had to seek bailouts to avoid collapse, including regional rivals South African Airways and Kenya Airways.
Negotiations between Ethiopian and Boeing NA over compensation for the Max jet may be finalized in the next two months, Tewolde said. The model was grounded around the world last year following a second fatal crash outside Addis Ababa in March 2019.
“We want the compensation as soon as possible,” the CEO said.
©2020 Bloomberg L.P.