PNG Air latest loss
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PNG Air latest loss
PNG Air has recorded a K22.6 million loss before abnormal items and tax. The abnormal items included ATR induction costs of K2.31 million and over K18 million from the required accounting treatment of future maintenance reserve recoveries being lost as a result of the early termination of aircraft leases. This is notwithstanding that the early returns are expected to generate substantial future benefits for the company, well in excess of those abnormal costs.
This was made known during the announcement of PNG Air half year results. Company directors said that the company is going through a transition phase with the introduction of its brand new ATR aircraft and is yet to acquire enough scale to maximise the benefits of the new aircraft. They also attributed the loss to the downturn in the PNG and global economies. Of particular note is the activity in the charter market for the resources sector which has tailed off. Bringing in the new ATR aircraft meant there had been some short term excess capacity in the company’s fleet and had also involved investment to upgrade infrastructure and systems.
The short term excess capacity has been addressed by the agreed return of leased aircraft and restructuring other aircraft leases. However company directors said that the short term loss augmented well for the company’s long term future, as it positions itself to capitalise on serving increasing demand when the PNG economy recovers and resource sector activity increases. This is part of the airlines plans to be the airline of choice in PNG. PNG Air will be introducing three more ATRs by the end of 2017. This will see more of the company’s flights with the ATR while regular passenger services can be expected to generate increased revenue and profitability in the longer term. The company is confident that its commercial strategy is the right one to underpin a sustainable and profitable operation in the future.
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This was made known during the announcement of PNG Air half year results. Company directors said that the company is going through a transition phase with the introduction of its brand new ATR aircraft and is yet to acquire enough scale to maximise the benefits of the new aircraft. They also attributed the loss to the downturn in the PNG and global economies. Of particular note is the activity in the charter market for the resources sector which has tailed off. Bringing in the new ATR aircraft meant there had been some short term excess capacity in the company’s fleet and had also involved investment to upgrade infrastructure and systems.
The short term excess capacity has been addressed by the agreed return of leased aircraft and restructuring other aircraft leases. However company directors said that the short term loss augmented well for the company’s long term future, as it positions itself to capitalise on serving increasing demand when the PNG economy recovers and resource sector activity increases. This is part of the airlines plans to be the airline of choice in PNG. PNG Air will be introducing three more ATRs by the end of 2017. This will see more of the company’s flights with the ATR while regular passenger services can be expected to generate increased revenue and profitability in the longer term. The company is confident that its commercial strategy is the right one to underpin a sustainable and profitable operation in the future.
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I would think the only thing propping them up is the fact that Pixi seem hell bent on self destructing and are cancelling flights at an ever increasing rate,thereby forcing the travelling public over to Png Air
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Oh for the days of Milne Bay Air.
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Travelair went bust 18 mths ago having never paid airnav charges,terminal rental etc...got away with it until the fatal mistake of not paying the the lessors
and aircraft subsequently repossessed
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and aircraft subsequently repossessed
.
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Not flash at all. Only K12.1 mill Shareholder's Equity.........
http://www.pomsox.com.pg/wp-content/...ce-sheet-3.pdf
Interesting in that PNG Air's annual revenue for the last financial year is in fact less that Talair's annual revenue 30 years ago.
http://www.pomsox.com.pg/wp-content/...ce-sheet-3.pdf
Interesting in that PNG Air's annual revenue for the last financial year is in fact less that Talair's annual revenue 30 years ago.
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I'd take the position that privatisation is an option under consideration.
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....worth 15 toea per share.
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troppo
apologies...brain fart by me.
And I remember the float so well....Prospectus mentioned two 737's. ..What could have been!!!
Also remember well that ANG and APNG almost became one!!!! Maybe that can be revisited..
apologies...brain fart by me.
And I remember the float so well....Prospectus mentioned two 737's. ..What could have been!!!
Also remember well that ANG and APNG almost became one!!!! Maybe that can be revisited..
It's pretty obvious tha PNG Air have a long term plan in terms of where they would like to be in 5 years and beyond.
Sources tell me that the progressive introduction of the ATR has proven to be a good business decision by the airline.
Obviously the industrial issues next door are currently having a positive impact on their business.
Whilst corporate charters probably kept them afloat in a time when they required more cashflow to keep the props turning, the bread and butter is still in the domestic RPT sector - and it always will be.
Seriously doubt that the merge idea will be thrown on the table again.
Sources tell me that the progressive introduction of the ATR has proven to be a good business decision by the airline.
Obviously the industrial issues next door are currently having a positive impact on their business.
Whilst corporate charters probably kept them afloat in a time when they required more cashflow to keep the props turning, the bread and butter is still in the domestic RPT sector - and it always will be.
Seriously doubt that the merge idea will be thrown on the table again.