LOT predicting rosy 2001
LOT Polish Airlines said last week that it expects to post another hefty profit in 2001, putting the national carrier in the black for the fourth consecutive year.
"In 2001 we expect a financial result similar to 2000," said Piotr Ikonowicz, LOT's vice-president and head of finance.
The company saw a 2000 net profit of zl. 49.7 million ($11.3 million) compared to zl. 3.6 million ($923,000) in 1999. "Good financial results were attained despite the 83.8% increase in fuel costs, an increase in interest rates and unfavorable currency exchange rates," the company said.
One of the reasons for the airline's robust growth in earnings is the increase in passenger numbers, which were up 7.2% to 2.79 million in 2000. In addition, LOT's business-class passenger numbers rose 6% in the same period, due to an increased number of connections, the company said. On average, LOT operated 22 more flights a day last year than in 1999.
The downside of increased traffic, however, is that seat occupancy dropped to 68.1% from 70.2% two years ago. "It's a consequence of the significant growth (in the number of flights during) the last quarter of the year connected with launching our Warsaw hub," said Jan Litwinski, president of LOT.
According to Litwinski, "the new (upcoming) summer schedule means further development of the hub. This means an increase in our activity at Okecie (Airport)." This summer, LOT is scheduled to fly to 54 North American and European cities and 10 Polish cities. Also, the number of transit connections will grow to 3,360 a week from its present 2,230. Last summer the company operated only 1,130 transit flights a week.
In addition, Litwinski said LOT also has plans to lift its presence on the charter market to 54% this year from 52% now. To achieve that goal, the company will have to boost passenger traffic to 420,000 in 2001 from last year's 343,000, he said. In the long term, though, LOT will shed charter activity from the company's core business. "We've been working on putting charters into a separate company with the help of one of the leading tour operators on the Polish market," said Marek Sidor, vice-president and head of LOT's connection network. "We'd like to separate this activity next year," Litwinski added.
LOT's continued strong finances are good news to the airline as it's planning to list on the Warsaw Stock Exchange this year. "LOT has posted positive results for the third year in a row, which is one of the major conditions for companies going public," said Treasury Minister Aldona Kamela-Sowinska last week.
