The Slovenia Times

Slovenian Aviation Sector Looking at Revival and Privatisation in 2014



Aerodrom Ljubljana expects to service 7% more passengers in 2014 compared to this year's estimates, as it expects passenger numbers to grow with Adria Airways and Turkish Airlines, while a strong impact is expected also from Air Serbia's daily route between Ljubljana and Belgrade, which was set up in December.

The passenger numbers are expected to be reflected in growing revenues, which Aerodrom Ljubljana plans to increase by 4%. However, increased revenues will be followed by higher costs, although the growth will be lower.

The increase in costs will stem in particular in new costs like the real estate tax, but also from one-time additional costs related to the privatisation of the airport operator, which could take place as soon as in the summer of 2014.

Operating profit (EBIT) is planned to increase by 6% from this year's estimates, while net profit is expected to grow by just below 7% to EUR 5.3m.

The company is planning EUR 5.8m of investments in 2014, mostly in necessary adaptations, after the state's plan for a new passenger terminal was voted down by small shareholders in mid-September, as the state as the majority owner was stripped of its voting rights by the market regulator.

The operator of the Maribor airport also plans growth for next year, mostly on the account of increased charter traffic and cargo flights, according to Aerodrom Maribor CEO Marko Gros.

With highest activity again limited to the summer - although the season may start as soon as April and last until October - revenues are expected to increase by 20%, Gros has told the STA.

The flag carrier does not provide any official comments of its business plans for 2014, but the December-January edition of its magazine indicates in its strategy until 2020 that the company plans growth and expansion.

According to Adria Airways CEO Mark Anžur, the goal is to increase annual passenger transport to two million, to purchase new planes and optimise the fleet, open new routes, increase cost efficiency and adapt to the price needs of the market.

Anžur confirmed that new routes are planned for next season from Ljubljana to Warsaw, Prague, Tirana and Frankfurt, while the airline's London (Gatwick) route is also to be resumed.

After years in the red, the airline plans to break even this year, but it remains unclear whether it has succeeded in doing so. The latest data shows a EUR 700,000 profit in the first nine months after a EUR 6.8m loss in the same period last year.

In the first three quarters of the year, the company transported a total of 808,370 passengers and the seat capacity use on regular flights was increased to 73.5%. Winter months, however, traditionally bring poorer results.

Adria Airways is meanwhile waiting for the decision of the European Commission whether it will categorise a state capital injection as state aid, which would mean a severe blow to the airline as it would need to return most of the funds.


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