Jazeera Airways’ 2023 revenues surge to KD 198.08 million, operating profits at KD 11.76 million

Tuesday, February 13, 2024

Jazeera Airways announced a net profit of KD 6.13 million for the entirety of 2023. Operating revenues reached KD 198.08 million, marking an 8.8% rise from 2022, while operating profits stood at KD 11.76 million. Passenger numbers soared by 30.6% to 4.68 million, and the load factor experienced a slight uptick from 77% to 78.2%, despite a decrease in yield from KD 47.96 to KD 39.63. Nonetheless, the airline’s market share in Kuwait climbed to 36.24%.

At Jazeera Terminal 5, under Jazeera Airways’ ownership and management, retail lease revenue surged by 51% to KD 1.54 million in 2023, while Duty Free revenues saw a modest 1% increase to KD 1.3 million.

In Q4 2023, Jazeera reported a net loss of KD 7.14 million, with operating revenue for the quarter amounting to KD 39.18 million. Despite the loss, passenger numbers rose by 17.3% to 1.15 million, with a load factor of 75.8% and an average utilization increase of 2.2% to 12.7 hours compared to the same quarter the previous year.

For the first half of 2023, Jazeera distributed 28 fils per share in cash dividends, but the Board of Directors recommended against further dividend distribution for the second half of the year.

Marwan Boodai, Chairman, Jazeera Airways, said: “In 2022, we earned record profits that
were driven by a huge demand for travel, lesser capacity and a one-time gain from selling
and leasing back of engines. For 2023, we emerged profitable despite lower yields,
influenced by overcapacity amid a challenging regulatory, geopolitical, and regional
landscape. Higher load factors and greater market share put Jazeera Airways in a strong
position while we continued to maintain a fanatical focus on unit cost. This is a strong
demonstration of our robust and resilient business model as well as the quality of service we
provide. We continue to remain unwavering in our commitment to grow and enhance our
operations, provide quality service to our customers, and to further strengthen our foundation
for success in the coming year 2024.”

Financial Highlights for 2023:

• Operating revenue increased by 8.8% to KD 198.08 million.
• Operating profit decreased by 56.2% to KD 11.76 million.
• Net profit declined by 69.5% to KD 6.13 million.

Highlights for Q4 2023:

• Operating revenue decreased by 5.2% to KD 39.18 million.
• Operating loss widened significantly to KD 6.32 million, marking a decrease of 822%.
• Net loss deepened substantially to KD 7.14 million, showing a decline of 945.5%.

2023 Operational Summary

Throughout 2023, Jazeera Airways expanded its services by adding 10 new routes, bringing its total destinations to 64 spanning the Middle East, Central & South Asia, Europe, and Africa. Among the new destinations were Moscow, Samarkand, Larnaca, Sphinx (Cairo), Shiraz, Tivat, Belgrade, Tirana, Islamabad, and Tehran.

Furthermore, the airline bolstered its fleet by acquiring three additional aircraft, boosting its total to 23. In an effort to streamline operations and cut costs, Jazeera established its own wheels, brakes, and battery shop, thereby insourcing related services. Additionally, the company invested in over 2,000 lightweight airplane seats, projected to save 1.2 metric tons in weight, reduce jet fuel consumption, and accommodate an extra row of passengers.

Demonstrating its commitment to sustainability, Jazeera released its inaugural ESG sustainability report and became the first low-cost carrier in the Middle East to transition from plastic to eco-friendly in-flight food service ware.

At Jazeera Terminal 5, various enhancements were implemented to enhance passenger experience, including new gates and check-in counters, changing rooms, a duty-free shop, and dining establishments.

Jazeera Airways received recognition for its workplace culture, earning a spot on the Best Workplaces in Asia list based on a survey conducted by Great Place to Work. Additionally, it secured a place on the inaugural Fortune 500 Arabia list.

Looking ahead, Jazeera Airways remains steadfast in its growth trajectory. Over the next five years, the airline aims to expand its reach to over 100 destinations and increase its fleet to 35 aircraft. Projections indicate a load factor surpassing 80% within the next three years.

Construction of a new hangar is underway to accommodate higher-level maintenance checks, slated for completion by 2025. Additional expansions are also planned to accommodate the anticipated increase in passenger volume.

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