FY18 Earnings Conference Call
Agenda
Headline Results
FY18 Highlights
FY18 Financial Review
Q&A
Disclaimer
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Certain sections or material provided on this document e might contain forward-looking forecast or statements. Such statements do notguarantee the future financial or operational performance of the company. Furthermore, these statements involve a high degree of uncertaintyrisks that could cause actual results to be materially at variance from those proposed in the forward-looking statements. Accordingly, thesestatements should only be used as indicative plans and the responsibility of any decisions based on them lies solely on the user without anyinvolvement from Jazeera Airways.
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HeadlineResults
Headline Results
4Q18Operational Highlights
Passengers +52.5%
4Q18: 478 k4Q17: 333 k
Load Factor +1.7%
4Q18: 70.7%4Q17: 69.0%
Utilization +39.6%
4Q18: 14.8 hrs4Q17: 10.6 hrs
Yield+12.4%
4Q18: 38.0 KWD4Q17: 33.8 KWD
Headline Results
FY18Operational Highlights
Passengers +46.4%
2018: 2.0 million2017: 1.4 million
Load Factor +1.3%
2018: 75.2%2017: 73.9%
Utilization +24.7%
2018: 13.6 hrs2017: 10.9 hrs
Yield-2.1%
2018: 40.8 KWD2017: 41.7 KWD
Headline Results
4Q18Financial Highlights
Operational Revenue KWD18.7 mn
4Q18: KWD18.74Q17: KWD10.6
Difference: 76.3%
*Operational Profit -KWD2.2 mn
(Adjusted: -KWD1.3 mn – YoY: -30.0%)
4Q18: -KWD2.24Q17: -KWD1.8
Difference: 20.8%
*Net Profit-KWD1.8 mn
(Adjusted: -KWD0.9 mn – YoY: -34.1%)
4Q18: -KWD1.84Q17: -KWD1.4
Difference: 32.1%
* Includes KWD651k one offs related to irregular events in 4Q18 and KWD256k operating loss related to facilities operations.
Headline Results
FY18 Financial Highlights
Operational Revenue KWD82.4 mn
2018: KWD82.4 mn2017: KWD56.6 mnDifference: 45.5%
*Operational Profit KWD6.8 mn
(Adjusted: KWD8.8 mn – YoY: 13.9%)
2018: KWD6.8 mn2017: KWD7.7 mnDifference: -12.1%
*Net ProfitKWD6.7 mn
(Adjusted: KWD8.7 mn – YoY: 5.2%)
2018: KWD6.7 mn2017: KWD8.2 mnDifference: -19.0%
* Includes KWD1.5 mn one offs related to irregular events in 2018 and KWD534k operating loss related to facilities operations.
Headline Results
FY18Commercial Highlights
E-Commerce Sales
+11.8% Vs. 2017
Ancillary Revenue
+40.8% Vs. 2017
Headline Results
Q4 2018
Network Highlights
Q1 2018
Q2 2018
Launched In
Ahmedabad
Kochi
Mumbai
Tbilisi
Lahore
Medinah
New Delhi
43%Market Share
* New Delhi was operational in the last two weeks of 2018
** Medinah is operated on a seasonal basis
25%Market Share
1%*Market Share
42%Market Share
27%Market Share
13%Market Share
**
Headline Results
Network Highlights
Passengers Geographic DistributionFY17
Passengers Geographic DistributionFY18
Headline Results
Network Highlights
Jazeera Market ShareFY14 – FY18
Kuwait International Airport TrafficFY14 – FY18
In million In million
Other passengers Jazeera passengers Jazeera market share KIA passengers Passenger growth
Headline Results
Fleet Highlights
Current fleet of 9 aircraft, up from 7 at the end of 2017.
The A320neo offers:
• Significant fuel savings up to 18% over traditional engines.
• Allows more flying time expanding flying radius to +6hrs.
• Improved customer experience due to lower noise.
The latest addition was the first A320neo to be delivered in the region.
Contracts signed for 3 new A320neos to be added to the fleet in 2019.
Headline Results
Jazeera Facilities
Jazeera Terminal carried 1.27 mn
passengers since opening in May 2018.
Duty free and airside retail are now fully
operational.
Collection of check-in charges
commenced from the start of operations.
Retail leasing ongoing while all
concessions are now actively serving
Jazeera passengers.
Jazeera Terminal started operations in May 2018.
FinancialReview
Key Parameters FY18
Operating Parameters FY17 FY18 CHANGE
Average Aircraft 7.0 8.6 22.6%
Destination Cities 19 26 36.8%
Revenue Drivers FY17 FY18 CHANGE
Seats 1,838,244 2,642,110 43.7%
Passengers 1,357,745 1,987,286 46.4%
Load Factor 73.9% 75.2% 1.4%
Net Yield 41.7 40.8 -2.0%
Profitability Drivers FY17 FY18 CHANGE
Sectors 11,569 16,194 40.0%
Block Hours 27,857 42,540 52.7%
Utilization (BH per Day) 10.9 13.6 24.6%
• Capacity increased by 44% though number
of aircraft increased only by 23%.
• This was achieved by 25% improvement in
daily utilization of the capacity.
Major reasons for adverse variances FY17 Vs FY18
• Fuel Price increase (KWD4.4 mn)
• Yield reduction due to fierce competition (KWD 1.5 mn)
• One time costs (KWD 1.5 mn)
• Terminal loss (KWD 0.5 mn)
Key Parameters 4Q18
• Fuel Price increase (KWD 1.1 mn)
• One time disruption costs (KWD 0.7 mn)
• Terminal losses (KWD 0.3 mn)
• Yield increase of 12% (KWD 2 mn)
Operating Parameters 4Q17 4Q18 CHANGE
Average Aircraft 7.0 9.0 28.6%
Destination Cities 18 25 38.9%
Revenue Drivers 4Q17 4Q18 CHANGE
Seats 454,361 675,644 48.7%
Passengers 313,356 477,988 52.5%
Load Factor 69.0% 70.8% 1.8%
Net Yield 33.8 38.0 12.5%
Profitability Drivers 4Q17 4Q18 CHANGE
Sectors 2,858 4,160 45.6%
Block Hours 6,821 11,154 63.5%
Utilization (BH per Day) 10.6 13.5 27.2%
Financial Performance 4Q17 4Q18 CHANGE
Operating Revenue 10,592,668 18,673,967 76.3%
Operating Expenses 12,380,196 20,832,444 68.3%
Operating Profit -1,787,528 -2,158,477 20.8%
Net Profit -1,368,887 -1,808,902 32.1%
Major reasons for adverse variances 4Q17 Vs 4Q18
Major reasons for favorable variances 4Q17 Vs 4Q18
Financial Review
Financial Position
FY17 FY18 CHANGE
Operating Revenue 56,611,376 82,369,370 45.5%
Operating Expenses 48,899,086 75,587,000 54.6%
Operating Profit 7,712,290 6,782,370 -12.1%
Net Profit 8,235,287 6,667,290 -19.0%
YIELD BY QUARTER (KWD)
PASSENGERS BY QUARTER (000)
47
50
6154
4647
53
41
40
43
49
38 36
4549
34
3541
47
38
1Q14
2Q
14
3Q
14
4Q
14
1Q15
2Q
15
3Q
15
4Q
15
1Q16
2Q
16
3Q
16
4Q
16
1Q17
2Q
17
3Q
17
4Q
17
1Q18
2Q
18
3Q
18
4Q
18
263
278349
274
281
291
381
266
295
300
381
245
282
314
448
313
404
490
615
478
1Q14
2Q
14
3Q
14
4Q
14
1Q15
2Q
15
3Q
15
4Q
15
1Q16
2Q
16
3Q
16
4Q
16
1Q17
2Q
17
3Q
17
4Q
17
1Q18
2Q
18
3Q
18
4Q
18
FY17 FY18 CHANGE
Cash 22,778,406 6,465,306 -71.6%
Fixed Assets 13,769,407 21,971,472 59.6%
Total Assets 56,213,150 62,866,145 11.8%
Total Liabilities 18,016,227 25,029,733 38.9%
Equity 38,196,923 37,836,412 -0.9%
The Board of Directors recommended cash dividend of KWD7 million (FY17: KWD7 million), subject to shareholders’ approval at the Company’s AGM.
Financial Review
FuelBRENT Swap Vs. SINGJET Swap (USD/BBL)
Fuel as Percent of Direct Cost
BRENT Swap
SINGJET Swap
Balance Sheet Analysis FY18
Current Assets declined by ~KWD3 mn mainly due to:• dividend payout of KWD7 mn• Internal funding of the Terminal building construction of KWD10 mn• Increase in receivables of KWD11 mn mainly due to bunched up Engine shop visits in 4Q18
(shortage of spare parts from CFM delayed all Engines from MROs from 4Q17). This is a temporary increase until maintenance reserves/insurance claims are collected in 1Q/2Q19.
Non-Current Assets increased by ~KWD10 mn primarily due to:• Terminal building becoming operational in 2018• Security deposits paid to aircraft lessors for 2019 deliveries
Trade Liabilities have increased by ~KWD7 mn due to:• Increased level of operations & the bunched up engine invoices in Q4, which will get cleared
in 1Q/2Q19.
Debt and Equity remained at the same levels as FY17.
Q&A
Key Contacts
For more information please contact
Krishnan BalakrishnanVP [email protected]
Mostafa El-MaghrabyHead of Investor [email protected]
Jazeera Airways KSC is listed on the Kuwait Stock Exchange
Bloomberg: Jazeera KKReuters: JAZK.KW
Stay up to date with the latest investor information:investorrelations.jazeeraairways.com
Thank you