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Air Serbia to surpass €500 million in revenue this year

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Air Serbia will surpass 500 million euros in revenue for the first time this year, following the carrier’s strong summer, a development the airline’s CEO, Jiri Marek, described as “significant”. The company is also expected to post a record net profit by the end of the year. Speaking recently to “Aerotime Hub”, Mr Marek noted, “For the first time in history we will surpass half a billion euros in revenue which is very significant, and we are seeing all KPI’s [key performance indicators] growing, weather it is the RASK [revenue per available seat kilometre], passenger numbers or transfer traffic.

Demand is so strong in this region that if we had more capacity and deployed it, we would fill it up as well”. The Serbian carrier generated 22.4 million euros in net profit during the first half of the year and is on course to post strong financial results for the whole of 2023, while passenger numbers are expected to reach four million this year. “We anticipate that the profit will be very high and at the moment we are operating with a double-digit profit margin”, the CEO said.

Looking ahead, Mr Marek noted, “We have a Letter of Intent signed for an additional three ATR72-600 deliveries in Q1 [2024]. There might be a delay because landing gear [shortage] is a growing problem among regional aircraft. We saw delays this year and we anticipate delays next year so we have planned for that, but we will see how it develops”. He added, “In terms of Airbus, as soon as we reach the end of the leasing agreements for A319s we will phase them out and replace them with A320s, which is a bit challenging now because of the latest issues with new technology and LEAP engines so airlines are not returning a lot of aircraft to lessors as planned and they are extending the use of mature technology over the new one because there is strong demand, but new aircraft deliveries plus problems with new technology are bringing that segment into stress”.

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The airline plans to grow its route network next year, however, with 23 new destinations added in 2023, focus will be placed on densification. “We want to position ourselves as a regional carrier, which means a high focus on connecting destinations within the region because that is economically viable. We are increasing frequencies on these regional routes, where you have some point-to-point demand with Belgrade and the transfer comes on top of that. There is still some differences in the region, for example, if you compare Tirana, which is mostly connecting traffic, versus Montenegro, which is mostly point-to-point traffic.

However, overall, we believe that we can grow within the region. Any new destinations that we will plan in the east, like for example in Romania or Bulgaria, will be purely connecting because the point-to-point demand is very limited. It would be maybe 20% or less”, Mr Marek explained. He concluded, “We don’t want to stop there. We want to continue to grow, to develop and to reach new markets. We want to bring Belgrade and Air Serbia onto the map even more, because we have now reached a certain size. We want to be the engine of the economy and growth which we already are and develop it further”.

Source: ex yu aviation

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