Company Profile - Flag Carrier Adria Airways (Feature)
Company Profile - Flag Carrier Adria Airways (feature)
The seat of the flag carrier Adria Airways
File photo.
Brnik, 27 February (STA) - Slovenian flag carrier Adria Airways is one of 15 companies on the list of companies to be sold off in the first wave of privatisation by the government. With a history spanning over 50 years, the airline is currently facing restructuring aimed at returning it to profitability following the shifts in global aviation in the past decade.
A small, regional airline, Adria Airways is operating a modern fleet of 11 short- and medium-range aircraft, which run around 170 weekly scheduled flights to around 20 destinations in Europe.
Launched in 1961 as a charter airline, Adria began operating scheduled flights three years later with the opening of LjubljanaAirport.
While scheduled flights represent the bulk of operations, charter services are still an important segment for Adria, which has two regular charter flights while operating as many as 20 charter routes in the summer months.
LjubljanaJožePučnikAirport remains the hub for the state-owned airline, which has in recent years began to focus more on flights connecting airports outside of Slovenia, with a special focus on Prishtina in Kosovo and niche destinations such as Verona in Italy.
While enjoying commercial success following its transformation into a joint-stock company in the mid-1990s, the airline was hit hard by the global aviation crisis in 2007 and an increase in competition on its most profitable routes.
With its losses mounting due to increasing costs, the airline received a EUR 50m state bailout in 2011 in order to keep it afloat following its fifth consecutive loss-making year. The aid, as well as previous recapitalisations dating back to 2007, are being reviewed by the European Commission for compliance with EU rules on state aid.
The company has been looking for a strategic partner since and media have speculated about potential tie-ups with a number of airlines, including Lufthansa, Qatar Airways and Air India, none of which have materialised.
A code-sharing partner of Lufthansa since 1995, Adria has been a member of Star Alliance, the world's largest airline alliance, since 2004.
Recent restructuring efforts have focused on adapting the fleet, selling non-core assets, cutting labour costs and abolishing loss-making routes.
CEO Mark Anžur expressed confidence in August 2013 that the company was capable of creating 15-20% annual growth in revenues following the transformation and with the injection of the right mindset. "In the short-term we can reduce costs, but when the time comes for creativity and growth, there can be no success without the right staff," he told the STA.
The airline embarked on a major fleet overhaul in the late 1990s and early oughs as it replaced its fleet of McDonnell Douglas MD-80, DeHavilland Dash 7 and McDonnell Douglas DC-9 aircraft with a fleet of smaller and more fuel-efficient Canadair Regional Jet 200 and 900 models, while continuing to operate Airbus A320 aircraft.
In recent years it added two Airbus A319 planes to its fleet, while selling or leasing out all but one of the larger A320 models. Most recently it has begun replacing CRJ 200 aircraft with CRJ 900 models.
The Brnik-based company has enjoyed a strong safety record since its transformation into Adria Airways, putting behind three major accidents from its early years as Inex-Adria Aviopromet, including a 1981 crash in Corsica in which 180 people were killed.
KEY DATA
Full company name: Adria Airways Slovenski letalski prevoznik, d.d.
Financials, in EUR million:
2009 2010 2011 2012 2013
Net sales 164.17 149.70 159.87 150.33 ------
EBIT -12.21 -59.72 -15.26 -8.10 0.46*
Net profit/loss -13.99 -63.07 -12.03 -10.80 -3.1*
* unaudited figures reviewed by supervisory board in February 2014
Major shareholders as at January 2013:
Republic of Slovenia 69.86%
NLB* 19.62%
Abanka* 4.73%
PDP* 2.07%
Hypo Alpe Adria Bank 1.80%
Unicredit banka 1.76%
Other 0.16%
*state-owned
Source: Adria Airways webpage
Passenger and flight figures:
2011 2012 2013
Number of passengers carried (in m) 1.163 0.987 1.029*
Passenger load factor (in %) 63.05 68.99 73.00*
Number of flights (in thou.) 24.48 20.86 19.80*
* calculations based on data reviewed by supervisory board in February 2014
Type of incorporation: Joint-stock company, non-listed
CEO: Mark Anžur, since December 2012
Number of employees: 400 as at end of April 2013
Fleet: one Airbus A320, two Airbus A319, four CRJ 200 and four CRJ 900
Website:
Sources: company annual reports, company website, STA wire