AIR BERLIN TO REDUCE FLEET IN 2011

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By TESTCustomwebLP TESTCustomwebLP November 19, 2010 14:48

AIR BERLIN TO REDUCE FLEET IN 2011

Air Berlin plans to reduce the size of its fleet in 2011 to improve efficiencies to offset the impact on revenue of the tax on air traffic introduced by the German government from 2011.

The airline expects the tax to lower revenue from €160 million to €170 million next year as the tax will be impossible to pass onto passengers, says chief executive Joachim Hunold: “In my opinion, the fierce competition on some flight routes will make it impossible to pass on the air travel tax to the passengers in its entirety. Therefore we will reduce our capacity by 5% and reduce our fleet by seven aircraft, instead of carrying out the originally planned increases.”

Air Berlin announced it target earnings before interest and taxes, or EBIT, of €55 million in 2011, which is in line with the market expectations.

The airline will post a 2010 net loss due to negative financial results following the partial buyback of a convertible bond. However financing costs will improve through 2014 as a result, says the airline.

Net profit was €22.2 million for the first nine months of 2010, from €13.8 million in the prior-year period.

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By TESTCustomwebLP TESTCustomwebLP November 19, 2010 14:48
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