What can you bring to the role of president and chief executive officer?
Apart from my qualifications in finance, I have 14 years of experience in the airline industry, including comprehensive knowledge of Gulf Air. I have been with the airline through some of its best and toughest times, so I am aware of the challenges Gulf Air and its staff face on a daily basis. I will continue to use the experience from my colleagues to drive Gulf Air’s business forward. I also hope to bring sound judgement and a measured, prudent approach to the business during this transition phase, when it will be important to maintain the confidence of our customers and stakeholders.
Your predecessor James Hogan was placed in charge of the three-year turnaround programme Project Falcon. What is your brief?
I was part of the senior management team to develop and implement Project Falcon and the Smart Airline, Smart Business strategies. My brief is to maintain business continuity and the confidence of our customers and stakeholders during the transition, following the blue print we laid out in our new strategic plan, Smart Airline, Successful Business.
When will a permanent successor to James Hogan be announced?
Gulf Air is presently in the final stages of the process to appoint a permanent successor. You can expect an announcement in the imminent future.
Industry sources have suggested that Gulf Air is in financial difficulty. What is your response?
Like all airlines at the present time, Gulf Air is significantly affected by the price of fuel. Currently, fuel is almost double what we were paying four years ago. However, we cannot give a specific figure as the price of fuel continues to fluctuate. Suffice to say, it is our largest single cost item. And although our key performance indicators continue to move in the right direction, they will not mitigate the damaging effects of the cost of fuel on the business.
What are the obstacles and opportunities of being owned by two governments?
They are joint shareholders with equal representation on the board. Decisions made are in the best interests of Gulf Air taking into account the considerations of the respective shareholders. Gulf Air’s two shareholders have confirmed their complete support and commitment to the success and prosperity of the business. This commitment provides a solid basis on which to resolve and work through any potential obstacles and challenges.
Bahrain and Oman will fund Gulf Air for the next three years. What will happen after this time? Is Gulf Air making plans to begin funding itself?
That will be a decision for the Board when the time comes. At this point, it will be important for us to work at minimising our cost base, while continuing to maximise revenue and drive growth in what continues to be a very competitive market.
Gulf Air has not hedged fuel in the past and James Hogan said the airline has “taken a knock” because of it. Will Gulf Air hedge fuel under your leadership?
We have been reviewing hedging options, and believe that an effective mechanism will allow us to mitigate risk. However, if the time is not right, and if the price of oil remains at present levels, it is not appropriate to hedge.
What do you think are the future challenges facing Gulf Air?
All our efforts remain focused on implementing our new business strategy, which ensures that the airline has the strong foundations for long-term growth and business success. Fuel remains a wild card for us. Positioning ourselves regionally and internationally as the dynamics of the airline industry continues to evolve, is a challenge. We are seeing unprecedented growth in air travel, but it’s countered by an equally aggressive increase in competition, and in the establishment of low cost carriers. These factors are impacting growth, in addition to prices and yields across the industry.