Oman Air AGM Hear Positive Results

Oman Air’s shareholders today received positive financial results for 2015 at the airline’s Annual General Meeting (AGM) that was held at Oman Air’s headquarters in Muscat. 

Oman Air’s Chairman, His Excellency Darwish Bin Ismail Bin Ali Al Balushi, provided reports covering the company’s financial and operational progress over the last full year. 

Shareholders heard that Oman Air’s revenues increased by 14.1 per cent, to RO 465.971 million. Furthermore, the airline’s losses were reduced for the second consecutive year by 21.2 per cent to RO 86 million.

In addition, Oman Air carried 6.3 million passengers in 2015, up from 5.1 million the previous year. More than 28,000 round trips were recorded and capacity in 2015 rose to 20.5 billion available seat kilometres, with an average seat factor of 71.4 per cent being achieved. 

Oman Air saw the arrival of nine outstanding new aircraft in 2015. These have included Oman Air’s first two Boeing 787-8 Dreamliners and new Boeing 737s.  In the same year, the airline launched three new destinations, Singapore, Goa and Dhaka, as well as adding frequencies to some of its established routes.

Oman Air’s staff at Muscat International Airport also handled 47,823 flights and 10.3 million passengers over the course of the year. Of these flights, 19,830 were operated by airlines other than Oman Air, resulting in an increase to RO 17.610 million in the total handling fees received in 2015 compared to RO 14.346 million in last year, an increase of RO 3.264 million. 

Oman Air’s catering division served 7.5 million meals in 2015, which was 900,000 meals more than 2014. A healthy growth of 9% in income from rooms, food and beverages was also recorded. The amount of cargo that Oman Air handled in 2015 increased to 140,000 from 125,000 tonnes of the previous year.  

His Excellency Darwish Bin Ismail Bin Ali Al Balushi, Chairman of Oman Air, on behalf of the Board of Directors of Oman Air, welcomed the attendees, stating:

“It gives me great pleasure to welcome you to the 34th Annual General Meeting and to present to you the Annual Report for the financial year ending 31st December 2015. The ambitious programme of expansion upon which Oman Air first embarked in the fourth quarter of 2014 is now well underway. Guided by a development plan which was endorsed by the Board of Directors in 2013, the programme has accelerated and has, overall, delivered very positive results. Central to Oman Air’s expansion has been the continued increase in the size of our fleet and, over the last 12 months, we have seen the arrival of nine outstanding new aircraft. These have included Oman Air’s first two Boeing 787-8 Dreamliners. Widely regarded as the most innovative airliners in a generation, the Dreamliners have provided a welcome enhancement to our long haul fleet. They have underlined the reputation for quality, comfort and reliability that was established by our Airbus A330s and were warmly welcomed by customers following their introduction to our Frankfurt route in October 2015. Our short and medium haul fleet has also been boosted by the arrival of additional new Boeing 737s. The adaptability of these aircraft, their ability to operate effectively within a broad range of climatic conditions and the on-board comfort that they offer, have seen these rugged aircraft become the backbone of Oman Air’s fleet.

“As our fleet grows in size, the on-board comfort that it offers is benefitting from a range of improvements. The new aircraft offer the very latest seats in every class, together with state-of-the-art IFE technology. Our older aircraft are steadily being retrofitted with interior products that match those on the new aircraft, ensuring a consistent passenger experience throughout. Such fleet expansion has enabled Oman Air to increase the size of our network, and in 2015, we were pleased to launch new services to Singapore, Goa and Dhaka. We were also able to offer more frequencies on a number of our established routes and all 11 of our Indian routes are now served by daily or double-daily flights. Additionally, Oman Air has also increased its weekly frequencies throughout its European destinations as follows: Frankfurt from 6 to 7, Munich and Milan from 4 to 7, Zurich and Paris from 4 to 5. Furthermore, we have worked hard, with our partners at Muscat International Airport, to improve connections and customers are now enjoying reduced waiting times and greater convenience.

“Oman Air’s capacity has, therefore, increased significantly over the last year. Available seat kilometres (ASKs) have increased by approximately 35 per cent to over 20.5 billion, whilst flight movements increased by more than 6,000 to nearly 48,000, compared with 2014. The number of round trips Oman Air offered in 2015 rose to well over 28,000 from the previous year’s 23,563. I am pleased to inform you that, as a result of this enhanced capacity, Oman Air has experienced a major increase in the number of passengers we carried in 2015. More than 6.3 million customers flew with Oman Air in 2015, compared with just over 5.1 million in 2014. This growth is a major achievement which illustrates that our strategic planning is broadly producing the desired results. His Excellency also added:

“Oman Air does not, of course, operate in isolation, and global economic changes can have a significant impact on our work. Significant among the changes witnessed in 2015 was the major drop in oil prices. This has affected Oman Air in two very different ways. The fall in oil prices has been mirrored by a fall in aviation fuel prices. Accordingly, Oman Air has paid lower prices for our fuel, enabling us to reduce the company’s losses. This, together with the major increase in the number of passengers carried, the amount of cargo handled and the continued development of ancillary revenues, has put Oman Air on a positive financial footing in 2015. It gives me great satisfaction to announce that Oman Air’s revenues for the last financial year increased to OMR 465.971 million – a 14.1 per cent increase on 2014’s figures and a higher level than at any previous time in our history. In parallel, we have been able to reduce our losses for the second year in a row, and by the end of 2015, they stood at OMR 86.333 million. This is a 21.2 per cent reduction compared with 2014. There is, however, a darker side to the fall in oil prices, namely the impact on the economy of the Sultanate of Oman. Oman’s oil resources provide a vital income stream for the country and the fall in prices continues to have a significant effect on our exchequer. As the proud national airline of our country, we are determined to make the greatest possible contribution to Oman’s prosperity. 

“I am therefore pleased to say that the level of support provided to Oman Air by the Government was reduced in 2015 to OMR 54 million. Furthermore, our increased revenues, continued expansion and lower financial loss have meant that we are able to request a further reduction in the level of financial support for the coming year. Oman Air remains on track to achieve its stated aim of reaching an operational break-even point by the end of 2017.

 “I am also pleased to say that Oman Air’s contribution to the Sultanate of Oman extends beyond the purely financial. We are committed to reflecting the rich culture and time-honoured heritage of Oman both at home and overseas, and we play an instrumental role in promoting the Sultanate as a warmly hospitable destination for both business and leisure travellers. Furthermore, as one of the country’s largest employers, we continue to make an important investment in enhancing the skills, experience and capacity of Oman’s workforce. In 2015, we expanded our programme of recruiting Omani pilots, participated in a range of educational initiatives, which aim to develop the Omani business leaders of the future and supported the growth of the Sultanate’s SME (small and medium sized enterprises) sector. Furthermore, in accordance with the decree issued by His Majesty Sultan Qaboos bin Said, we have reaffirmed Oman Air’s commitment to Omanisation. While we value our diverse and international workforce, we are also proud that by the end of 2015, 62.67 per cent of our employees are Omani citizens. As Oman Air continues to expand, we will do all in our power to increase this figure over the coming years.

His Excellency concluded the report by thanking His Majesty Sultan Qaboos Bin Said and said:

“I would like to thank His Majesty Sultan Qaboos bin Said and his Government for their invaluable advice, timely encouragement and wise guidance. My colleagues on the Board and within Oman Air’s management join me in expressing our gratitude to His Majesty for his vision, his kind benevolence and his support.”