Hedging plays havoc with Royal Jordanian
The Jordanian flag-carrier has paid a heavy toll for last year’s fluctuating fuel price, as the airline’s fuel hedging policy led to unrealised losses of about US$65.9 million. Royal Jordanian had hedged 30% of the fuel forecast for 2008 and 2009 at an average price of about $105 a barrel.
As a result, Royal Jordanian saw a net loss after tax of $33 million, after a fuel bill costing US$410 million was taken into account. However, operating revenues rose by 29% against 2007, with passenger numbers rising by 14.1%.
Royal Jordanian president and CEO Samer Majali also outlined that the carrier had had a tough first quarter, with events in Gaza hurting passenger figures. However, he added that passenger numbers were expected to rise in the summer months.
“RJ will continue to carry out its strategic plans, foremost among which being increasing the number of passengers and the revenues, in addition to boosting its financial position,” said Majali.
“It endeavours to achieve these plans by improving air and ground services, enhancing connectivity, and modernising the information systems in the human resources, cargo, procurement and maintenance departments, and completing the fleet modernisation plan,” he added.
Royal Jordanian has just gone live with the next-generation Cargospot freight management solution, and is also revamping its cargo facilities at its Queen Alia International Airport hub in Amman.