Business & Money | Sunday 29 March, 2015 1:15 am |

On behalf of the Board of Directors, it gives me great pleasure to welcome you to the 33rd Annual General Meeting and to present to you the Annual Report for the financial year ending 31st December 2014.

Oman Air is guided by a development plan which was endorsed by the Board of Directors in 2013. This sees our company invest significantly in new narrow-body and widebody aircraft, new destinations, technology and staff. The size of our fleet is expected to increase as per this plan to 50 aircraft by 2018, with a further increase to 70 aircraft being achieved by 2020.

In 2014, the second year of our plan, we have consistently added new aircraft to our fleet. The first of the Airbus A330s and Boeing B737s we have had on order were delivered, and we have also opened four new destinations, to Duqm, Sohar, Manilla and Jakarta. Furthermore, we have increased frequencies on a number of our established routes.

The new aircraft and destinations have helped us to increase the range of choices we offer to our customers and to boost the level of services offered to our valued customers.

In parallel with the onset of our ambitious expansion programme, we have continued our focus on quality, productivity and increasing revenues over the course of 2014. Throughout, we have held fast to two fundamental aims: to ensure that every Oman Air customer experiences the best possible products and services, and to pursue our unwavering commitment to achieving profitability.

This approach has resulted in increased opportunities for our customers to fly with Oman Air, and to enjoy our range of products and services. In addition, many customers of other airlines have benefitted from Oman Air’s hospitality as they have passed through Muscat.

In 2014, Oman Air operated more than 23,500 round trips and carried 5.1 million passengers, up from 4.9 million in 2013. Meanwhile, our capacity in 2014 rose to 15.2 billion available seat kilometres, and we achieved an average seat factor of 74.4 per cent.

Oman Air’s ground services have also worked effectively in 2014. Our staff at Muscat International Airport handled 41,450 flights and 8.7 million passengers over the course of the year. Of these flights, 18,000 were operated by airlines other than Oman Air, resulting in us increasing the total handling fees we received to RO 18 million in 2014.

The greater number of passengers carried, and handled at Muscat, by Oman Air has also resulted in more meals being prepared and delivered by our Catering Division. We served 6.7 million meals in 2014, up from 6.5 million in 2013 and increased revenues year on year by three per cent. A healthy growth in income from rooms, food and beverages was also recorded.

Combined, these very positive results have had an important impact on Oman Air’s overall financial position. Our total revenues increased by four per cent in 2014 - broadly in line with the global industry average - to OR 398.389 million. This sum included the Government of Oman’s reaffirmed support for Oman Air in the form of a RO 138.110 million contribution.

Our revenue growth ensured that Oman Air’s net loss for the year 2014 was reduced by RO 4.280 million, or 4 per cent, reversing a pattern set over the last few years largely as a result of investment in new aircraft.

Worth mentioning that despite the operational loss incurred in 2014 amounting to RO 95.866 million, yet the social and economic returns benefited by the Sultanate of Oman as a result of the operational activities of Oman Air, reached RO 420 million, as reflected in the study on contribution to the national economy conducted in this regard, assuring the importance of the role played by the national carriers in fulfilling the social and economic objectives of the national economy.

I am pleased to note that Oman Air’s progress has been matched by continuing improvements in the passenger experience that we offer our customers. Following the refurbishment of our premium check-in facility at Muscat, we opened our newly-upgraded First Class and Business Class check-in facility in September. This is complemented by our excellent facilities at Salalah International Airport. These investments have once again confirmed Salalah as a vital station within Oman Air’s network. And in November, we unveiled brand-new Business Class and Economy Class cabins. Each offers outstanding space and comfort, whilst also enabling us to increase the number of passenger we carry.

The operation of a successful airline is reliant upon the quality of its people. I am proud, therefore, that over the last year we have continued to invest in our employees. In the course of 2014, our staff strength increased to 6,322 people, a significant proportion of whom are stationed overseas. Whilst we value our diverse and international workforce, we are also proud that by the end of 2014, 59.3 per cent of our employees are Omani. In accordance with His Majesty Sultan Qaboos bin Said’s directive, we continue to pursue the country’s Omanisation policy with vigour. I look forward to seeing even more Omanis employed at every level of the company over the coming year.

Building on our commitment to Omanisation, Oman Air has continued in 2014 to increase opportunities for Omani citizens and raise awareness of their achievements at an international level. Our ongoing sponsorship of the Oman Football Association and the national team has assisted in taking Omani sporting skill to huge international audiences, as has our sponsorship of Oman Sail. I have also been delighted to follow the Oman Air-sponsored motorsports success of Ahmad Al Harthy, and to see the company provide backing for a range of high profile sporting and cultural events within the Sultanate. All these activities have brought international attention to Oman and have helped to raise awareness around the world of the country as an ideal destination for both business and leisure.

Successful airlines also require strong leadership and in August we were pleased to welcome Paul Gregorowitsch to Oman Air as our new Chief Executive Officer. In the short time he has been with us, Mr Gregorowitsch has made tangible impact on every area of operation and his dynamic management of our expansion programme has been invaluable. On behalf of all at Oman Air, I would like to offer him a very warm welcome. I would also like to thank his predecessor for the important contribution he made during his tenure.

The last year has, then, been another eventful one and I would like to take this opportunity to thank my esteemed colleagues on the Board of Directors, the Executive Committee and the Audit Committee. They have provided invaluable support and advice to the management of Oman Air, helping to continue Oman Air’s year-on-year success.

Finally, 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.