Dublin-based CityJet will return to profit in 2015 says new owner Intro Aviation
Newly independent airline starts debt free as it plans fleet renewal and major rebrand
CityJet has been sold, making it debt-free and ready for a major rebrand.
Speaking in Dublin earlier today, Hans Rudolf Wohrl, founder and chief executive of Intro Group, said: “We probably won’t be profitable this year but the losses seem to be reasonable.”
He added that the airline would “probably” return to the black in 2015 “but don’t ask me if I’m sure about it”.
“I’m not sure, everything is open”, he said, adding that fuel costs and competition on its key routes would be key factors in determining its financial performance.
CityJet has not made an operating profit since 2007. Latest accounts filed for the company show it made an operating loss of €21.3 million in 2012.
CityJet chief executive Christine Ourmieres said the airline was now debt free following the sale by Air France. “This is something that few airlines can say at the moment,” she said. “It means we are getting a fresh start.”
Ms Ourmieres said CityJet would rebrand in June and look at renewing its fleet “as soon as possible” to give it a longer range for flights. The airline has 18 Avro RJ85 regional jets and 11 Fokker 50 turbo prop aircraft. Limitations on the size of aircraft that can operate from its main hub at London City Airport make renewing the fleet a challenge, Mr Wohrl said.
Intro declined to comment on the financial terms around its purchase of CityJet but it is understood that Air France cleared the company’s debt as part of the transaction.
Ms Ourmieres said its services from London City to Dublin and Amsterdam were the airline’s busiest routes. Commenting on plans by rival Flybe to operate the London City to Dublin route from October, Ms Ourmieres said: “Competition doesn’t mean you have to panic...we will have to fight for this route.”
CityJet was founded in 1994 by Irish entrepreneur Pat Byrne, who then sold it on to Air France. The French airline decided to sell its Irish subsidiary two years ago for strategic reasons but a deal was only concluded recently.
The Swords-based airline has 850 staff, including about 300 in Dublin. There are four legs to the business - its operations on behalf of Air France, its hub in London City Airport, its regional UK and Europe routes (some undertaken by its Belgium subsidiary VLM) and charter flights.
Ms Ourmieres said job cuts are not planned. The airline wil continue to operates flights for Air France into Charles de Gaulle until 2017 and it has also signed code sharing agreements with the French airline and its Dutch associate KLM for the next three years, she added.
Ms Ourmieres and the airlines deputy chief executive Michael Collins will own 7.5 per cent of the airline under its new ownership structure.
Intro was founded in 1974 and it privately owned. It has investments across the aviation, retail and other sectors. The German company does not disclose its financial information.
In specialises in restructuring airlines and CityJet is its 11th such investment. Others have included Eurowings, Deutsche BA and LTU. It is currently the majority shareholder in Austrian regional airline InterSky.
“We’ve had only one airline that we couldn’t make work properly,” he said. “We hope CityJet will work well.”