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Monarch sale to Greybull Capital secures £125m permanent capital and liquidity facilities
Monarch Holdings has completed its strategic review and restructuring programme under which it has secured £125 million of permanent capital and liquidity facilities provided by Greybull Capital, anchored by a £50 million capital commitment, with contributions from the Group’s prior shareholders, principally the Mantegazza family.
Greybull has also acquired 90% ownership interest in Monarch, with the remaining 10% passing to the Group’s defined pension scheme and ultimately the Pension Protection Fund (PPF).
Meanwhile, the UK Civil Aviation Authority has renewed the Group’s ATOL licence.
Greybull has stated that it will provide significant capital to Monarch in order to grow the Group and build on its long-established heritage and trusted brand name.
Under the leadership of new chief executive Andrew Swaffield, Monarch has undertaken a comprehensive strategic review of all areas of the business, from operations to ownership and financing. The review aimed to create the optimum structure to realise the significant opportunity to build on Monarch’s respected brand and distinctive offer to its customers in the European scheduled leisure carrier market.
The main outcomes of Monarch’s strategic review and restructuring, which have led to the successful transaction with Greybull, are: optimisation of the fleet from 42 to 34 aircraft, and revised agreements with lessors to either mark-to-market or early return of 10 aircraft from the current fleet; the securing of a new Boeing fleet order for 30 737 MAX 8 aircraft with deliveries from 2018 to 2020; ending both long-haul and charter flying by April 2015; an airline network to specialise in Monarch’s ‘heartland’ of scheduled short-haul European leisure routes, with increased average frequencies, aircraft utilisation, productivity and profitability; to focus on five UK airport bases – London Gatwick, Manchester, Birmingham, London Luton and Leeds-Bradford – and the closure of East Midlands from summer 2015.
Other outcomes include: material concessions agreed with employees across the Group to enable the successful restructuring, including reductions in pay of up to 30%, with more than 90% of unionised staff voting to accept changes, and some 700 redundancies, two-thirds of which were voluntary; the reduction of the Group’s operating cost base, in line with other low-fare airlines, and increased efficiencies across the business; and finally the resolution of the Group’s pension deficit through agreement with the Pensions Regulator, PPF and the Trustee of the Monarch Airlines Limited Retirement Benefits Plan which will result in the Plan being assessed for entry into the PPF. The PPF would then hold a 10% stake in the Group, in line with its principles in restructurings such as this. The Pensions Regulator has cleared the restructuring.
Monarch Group CEO, Andrew Swaffield, remarked, “I am delighted to welcome the Greybull team as the new owners of the Monarch Group. We have a shared vision for the strategic direction and prospects for the business, and I am looking forward to working with them to implement the exciting plans for building our future. I would personally like to thank all Monarch employees who have been hugely supportive of the initiatives which were essential to complete this transaction. I am very proud to be leading such a team – together we will be building a great future for the Group.”
Low-fare airlines lead extra services in EuroAirport’s winter timetable
With the introduction of the 2014-2015 winter timetable, from 26 October 2014 to 28 March 2015, EuroAirport Basel-Mulhouse-Freiburg is increasing its flight offering to include ten new destinations, and most of the new scheduled services are being provided by low-fare airlines including easyJet, Wizz Air and, for the first time, Vueling.
Completely new for EuroAirport are flights to Bucharest with Wizz Air (twice weekly) and to Lanzarote with easyJet (also twice weekly).
For the first time during a winter season, easyJet will operate flights to Brindisi (twice weekly), Montpellier (three times weekly), Reykjavik (twice weekly) and Larnaca (twice weekly). The carrier will also be resuming flights to London Luton (six times weekly).
Also new this winter, Wizzair will operate two flights weekly to Cluj-Napoca in Romania and Ryanair will continue to fly to Dublin (three times weekly) and London Stansted (daily).
Over the Christmas period, Vueling – a completely new airline at EuroAirport – will offer additional flights to Barcelona and Rome and airberlin will fly to Lamezia Terme.
There will continue to be a wide selection of sunny winter destinations with weekly departures to Egypt (Hurghada), Morocco (Agadir, Marrakesh),Tunisia (Djerba) and Southern Europe including Spain (Fuerteventura, Gran Canaria, Majorca, Tenerife), Turkey (Antalya, Izmir) and the Cape Verde islands (Boa Vista, Sal).
In total, 25 airlines will be offering more than 60 destinations as direct scheduled flights from EuroAirport this winter – the equivalent of around 550 departures per week to 70 different airports.
EuroAirport’s management is expecting growth of around 10% for the whole of 2014 with passenger figures reaching almost 6.5 million.
AJW Aviation long-term aircraft support for Tigerair Australia
Tigerair Australia has signed an agreement with AJW Aviation which will see the latter deliver complete inventory technical management (ITM) for the carrier’s fleet of 13 Airbus A320s.
AJW Aviation’s ITM services will cover a variety of areas including components, major assemblies, wheels and brakes, auxiliary power units (APU), thrust reversers and consumables.
The agreement is mutually beneficial for Tigerair Australia and AJW, as it not only marks AJW’s first major contract in Australia, but the company’s global inventory of Airbus A320 spares is located in accessible hubs for Tigerair Australia across the region.
Furthermore, as a result of AJW’s strategic supplier relationship with Air New Zealand, formed in 2013, Tigerair Australia will also be party to the specialist capabilities provided by Air New Zealand TechOps’ repair stations in Auckland and Christchurch, reducing direct maintenance costs even more.
“Not only does AJW have a global fleet of over 500 aircraft under power-by-the-hour, we also have over 20,000,000 flight hours of fleet and component reliability data,” commented Deepak Sharma, CTO of AJW Aviation. “Very few organisations can share the experiences that we have which allow us to challenge ‘normal’ practices and truly innovate within the industry – this is what makes the new relationship with Tigerair Australia so ground-breaking.”
Photo (left to right) shows Boris Wolstenholme, AJW Group CEO, Robin Furber, head of engineering/continuing airworthiness manager at Tigerair Australia, Rob Sharp, CEO of Tigerair Australia and Deepak Sharma, AJW Group's chief technical officer
NBAA2014: Flight Display Systems upgrades JetJukebox product and unveils wearable controllers
Flight Display Systems has upgraded its JetJukebox wireless media streaming solution for business aircraft and is using NBAA to gather feedback on its new ‘wearable cabin controller’ wrist watch.
JetJukebox connects to an aircraft’s Wi-Fi router and streams content to as many as eight tablets, smart phones, or computers. Now, in a new development, the system can also stream video to a bulkhead monitor, as well as interfacing with the ‘Smart Cabin’ cabin management system to control functions including lights, video and audio.
“We are very excited to offer these additions and improvements to the JetJukebox,” says David Gray, president of Flight Display Systems. “We’ve already had such a positive response to the previous model. We can’t wait to hear what our customers say about this one.”
Other improvements to JetJukebox being showcased at NBAA are a fivefold increase in its moving map resolution – the standard resolution is 500 square metres per pixel, but now JetJukebox offers 90 metres per pixel – and increased storage from 240GB to one terabyte (the equivalent of 400 films).
In the future, Flight Display Systems may offer the ability to control the JetJukebox solution using a ‘wearable cabin controller’ wrist watch, another development in Flight Display Systems’ wireless cabin management technology.
The company’s ‘wearable cabin controller’ contains a processer with built in Wi-Fi capabilities. Combined with a Wi-Fi router and JetJukebox, it can show passengers data such as speed, altitude and estimated time of arrival. Designed to remove the need for a smartphone or tablet, the wrist watch can potentially be used to control lights, video and audio too, whilst attendants could use the devices for passenger communications and alerts.
Gray added, “No one knows exactly how wearables can best benefit the aviation industry yet, so we are exploring a lot of technologies in this area and will be ready to provide our customers with the best options.”
Gray added, “No one knows exactly how wearables can best benefit the aviation industry yet, so we are exploring a lot of technologies in this area and will be ready to provide our customers with the best options.”
NBAA 2014: Thales to provide new Gulfstream 500 and 600 jets with IFE
Gulfstream has selected Thales’ in-flight entertainment (IFE) system to be offered baseline on its new 500 and 600 business aircraft, making Thales’ solution the first standardised IFE product available on Gulfstream aircraft.
Thales confirms the Gulfstream 500 and 600 IFE offering will include network application content and all related services, using a system which bundles together the hardware supplied by Gulfstream with the end to end scalable solution supplied by Thales.
Operators will be able to pick from different content packages featuring the latest content from Hollywood studios and global TV networks. The IFE will be accessible on both the aircraft’s embedded displays and passenger’s personal electronic devices through an android operating system.
NBAA 2014: Honeywell announces Satcom1 as reseller of JetWave hardware
Satcom1 has signed a supplemental agreement with Honeywell Aerospace to become a business aviation reseller of JetWave Ka-Band satellite connectivity hardware, which exclusively supports Inmarsat’s Jet ConneX (JX) service, going live in 2015.
Satcom1 explains that the decision to become a hardware reseller for the first time in its 11-year history allows the company to provide clients with a full broadband solution.
“Honeywell is pleased to work with full service solution providers such as Satcom1, who have a primary focus of bringing simple, high-performance connectivity solutions to their customers,” commented Blane Boynton, Honeywell’s director of marketing and product management. “Satcom1 joins a global JX team, which will deploy the next generation of connectivity to meet the needs of tomorrow’s business aviation operators.”
Karina Larsen, co-founder of Satcom1, added, “Our aim is to work closely with completion centres, which prefer a SATCOM provider that can propose network design, ensure hardware fulfilment, and perform complete system testing and activation - prior to the final end-customer delivery.
“If we can simplify this process for anyone – we are proud to add JetWave hardware to our portfolio as part of the supply chain for SATCOM solutions,” Larsen concluded.
Senegal Airlines leases 1st Q400 from Falcon Aviation Services
Following a Memorandum of Understanding signed in July between Falcon Aviation Services and Bombardier Commercial Aircraft, Senegal Airlines has taken delivery of a Bombardier Q400 NextGen turboprop on lease from Falcon.
“With the assistance of Falcon, this wonderful Bombardier Q400 NextGen airliner will help us expand our fleet with a modern, fuel-efficient aircraft that has proven to be a robust, reliable and flexible performer in sub-Saharan Africa," explained Mayoro Racine, CEO of Senegal Airlines. “Our passengers will appreciate the quiet comfort of its interior, and the aircraft's speed will permit us to offer a seamless service between it and our larger jet aircraft.”
Bombardier has a Regional Support Office (RSO) and spare parts depot co-located in Johannesburg, South Africa as well as Authorized Service Facilities in both South Africa and Ethiopia, providing Africa with a strong customer support network.
“Safe operations are essential for the further development of the air transport system in Africa and the Q400 NextGen aircraft fits the criteria we have established for this venture,” noted Mahmoud Ismael, Falcon’s CEO.
flydubai begins flights to Tanzania
flydubai has completed its inaugural flights to Dar es Salaam and Zanzibar in Tanzania, the new routes further underlining the carrier’s rapid expansion in Africa, which has seen the network double to 12 destinations this year.
Commenting on the start of flights to Tanzania, Ghaith Al Ghaith, chief executive officer of flydubai, said, “The United Arab Emirates has recognised the immense potential in the emerging markets of East Africa, like Tanzania. We continue to work diligently to support the travel, trade and tourism objectives by strengthening the direct links between the UAE and these African markets.”
“The pace of flydubai’s expansion in East Africa has picked up. Six of the 23 new routes we have launched this year are to Africa,” noted Sudhir Sreedharan, senior vice-president commercial (GCC, Subcontinent and Africa), flydubai. “The potential we see for this market is just the tip of the iceberg as it is still a heavily underserved region. We are very excited about our new flights to Tanzania, which are going to be very popular for our passengers whether for leisure or business.”
Southwest Airlines announces record 3Q profit
Southwest Airlines has reported its third quarter 2014 (3Q14) results, featuring a record third quarter net income of $329 million, which included $53 million (net) of unfavourable special items, compared with third quarter 2013 net income of $259 million, which included $18 million (net) of favourable special items.
The 3Q14 net income excluding special items was $382 million, compared with 3Q13 net income excluding special items of $241 million – a 61.8% increase. Third quarter operating income of $614 million. Excluding special items, record third quarter operating income of $649 million.
Gary Kelly, chairman of the board, president, and chief executive officer, commented, "We are very pleased to report another record quarterly profit performance, which resulted in a $100 million third quarter 2014 profitsharing expense for our employees. Excluding special items, 3Q14 net income was $382 million and operating income was $649 million, resulting in a 13.5% operating margin. The 386 basis point year-over-year improvement in operating margin, excluding special items, was driven by strong revenues, lower jet fuel prices, and a solid cost performance.
"Total operating revenues were $4.8 billion, which was a 5.6% increase from a year ago, despite a 4% decline in trips and 2% fewer seats flown, as we work through the transition of AirTran aircraft. Our traffic and revenue trends were strong throughout the third quarter, generating a 4.5% year-over-year increase in unit revenues, despite a large percentage of our route system in development or conversion as we continued to transition AirTran flying to Southwest. Our third quarter 2014 revenue strength was driven by record load factors and a strong performance in our Rapid Rewards frequent flyer programme. Thus far, revenue momentum has continued into October 2014, with favourable load factor and unit revenue trends. Current bookings for November and December are also good.
"Our third quarter 2014 cost performance benefited from lower jet fuel prices and our fleet modernisation efforts,” Kelly added. “With these trends continuing, we are poised for another solid cost performance for 4Q14. Based on current cost trends, and excluding fuel and oil expense, profitsharing, and special items, we expect full year 2014 unit costs to increase approximately two percent compared to last year.
"October 13, 2014, was a momentous day for Southwest Airlines,” Kelly declared. “After 34 years, we are finally free from the Wright Amendment restrictions, and have proudly launched our initial nonstop offerings from Dallas Love Field to seven popular destinations, with ten more nonstop destinations, previously announced, on the horizon.”
As of 30 September 2014, the company had $3.6 billion in cash and short-term investments, and a fully available unsecured revolving credit line of $1 billion. Net cash provided by operations during 3Q14 was $240 million, and capital expenditures were $433 million. The company repaid $48 million in debt and capital lease obligations during 3Q14, and intends to repay an additional $395 million in debt and capital lease obligations during fourth quarter 2014, including $350 million repaid on 1 October 2014.
Interjet inaugurates Monterrey–Houston nonstop service
Interjet has begun flight operations to Houston, Texas, with its inaugural flight connecting George Bush Intercontinental Airport (IAH) and Monterrey International Airport (MTY) in Mexico.
The airline is offering two daily flights from Monday to Friday and one daily flight on Saturdays and Sundays. The inaugural flight from Monterrey received the traditional water cannon salute and a welcome celebration featuring dozens of well-wishers.
"With these new flights, Interjet strengthens its international presence by connecting two of the most important cities in terms of international business. Monterrey and Houston are key destinations to the expansion of our airline and passengers can enjoy all the benefits they will receive flying with us," remarked Interjet CEO Jose Luis Garza.
Depending on demand, the airline will feature service aboard its 150-seat Airbus A320 or its 93-seat Sukhoi Superjet 100 aircraft, with passengers departing from the Mickey Leland International Terminal (Terminal D) at IAH.
JetBlue increases 3rd quarter net income
JetBlue Airways has reported its results for the third quarter 2014 (3Q14), featuring a net income of $79 million, which is 11.3% up on the airline’s third quarter 2013 net income (3Q13) of $71 million.
The 3Q14 operating income was $164 million, compared with $152 million in 3Q13. Pre-tax income was $132 million in 3Q14, up from $119 million in 3Q13.
"We are pleased to report record third quarter earnings," declared Dave Barger, JetBlue's chief executive officer. "We saw improved profitability across our network, reflecting the success of our efforts to differentiate our product and culture and maintain competitive costs. I would like to thank our 15,500 crewmembers for their dedication to running a safe airline and delivering outstanding service to our customers."
JetBlue reported record third quarter operating revenues of $1.5 billion. Yield per passenger mile in the 3Q14 was 13.96 cents, up 0.9% compared with 3Q13. Passenger revenue per available seat mile (PRASM) for 3Q14 increased 2.4% year over year to 12.03 cents and operating revenue per available seat mile (RASM) increased 1.4% year over year to 13.00 cents.
Operating expenses for the quarter increased 5.7%, or $75 million, over the prior year period. Interest expense for 3Q14 declined 7.8%, or $3 million, due to JetBlue's focus on debt reduction. JetBlue's operating expense per available seat mile (CASM) for 3Q14 increased 1.2% year over year to 11.61 cents. Excluding fuel and profit sharing, CASM increased 2.6% to 7.13 cents.
"Our record results reflect the strength of our underlying business as we continued to drive margin improvement across our network," noted Robin Hayes, JetBlue's president. "Our focus remains on improving results through ancillary revenue initiatives, cost control and profitable growth. We believe these efforts will drive improved returns for our shareholders."
JetBlue continued to hedge fuel to manage price volatility. In 3Q14 JetBlue had in place hedges for approximately 23% of its fuel consumption and managed approximately 7% of its fuel consumption using fixed forward price agreements (FFPs). This resulted in a realised fuel price of $3.05 per gallon, a 2.7% decrease over the 3Q13 realised fuel price of $3.14. JetBlue recorded $1 million in losses on fuel hedges that settled during the third quarter.
JetBlue has managed approximately 34% of its fourth quarter projected fuel requirements using a combination of FFPs, jet fuel swaps and caps. Based on the fuel curve as of 16 October, JetBlue expects an average price per gallon of fuel, including the impact of hedges, FFPs and fuel taxes, of $2.80 in 4Q14.
Virgin America and China Airlines begin codeshare flights
Virgin America has implemented a codeshare arrangement with China Airlines that will offer customers seamless bookings and travel between Taipei, Taiwan, as well as other cities in Asia and multiple destinations across the United States.
The new codeshare agreement, Virgin America’s fourth, involves China Airlines placing its two-letter airline code (CI) on a range of the US carrier’s markets including flights between Los Angeles and/or San Francisco to Boston, Chicago, Dallas Love Field, Fort Lauderdale, Las Vegas, Newark, New York (JFK), Seattle and Washington Dulles (IAD). China Airlines customers can book their journey across the United States with Virgin America via China Airlines' website and experience one-stop check-in for boarding passes and checked bags.
"We are very pleased to launch our fourth codeshare partnership with one of Asia's leading carriers, China Airlines. Taiwan is both an important inbound and outbound tourism market for our airline and this arrangement will open up new opportunities to travel seamlessly between the United States and Asia through a simple one-stop booking and check-in process," explained Virgin America's director of network planning, Adam Green.
The codeshare partnership expands on the two airline's existing interline agreement, which began in May 2012.
Virgin Atlantic opts for Panasonic IFEC services on Dreamliners
Virgin Atlantic has announced that its new Boeing 787 Dreamliner fleet has been equipped with Panasonic Avionics’ in-flight entertainment and connectivity (IFEC) solutions.
Panasonic’s ex3 IFE system will provide passengers with a wide touchscreen monitor featuring content like Betria Interactive’s 3D moving map service. All seats also have a USB port so travellers can charge their personal electronic devices.
In terms of connectivity, Panasonic’s exConnect in-flight Ku-band Wi-Fi platform will provide internet whilst T-Mobile’s services will allow passengers to use their mobile phones.
Passengers can browse destination and aircraft information, Retail Therapy and further Virgin Atlantic services for free, but to secure internet for the duration of their flight there is a cost of £14.99.
Virgin Atlantic has also developed a #SkyHighSelfie app in conjunction with Wavealot, allowing passengers one chance to update their location with a picture of themselves on Facebook free of charge whilst in-flight, even developing certain #SkyHighSelfie spots in the cabin.
The airline hope the #SkyHighSelfie app will also act as a mile high discussion forum where customers on the flight can chat and spark debate in the air.
Qatar’s first A380 enters service with OnAir in-flight connectivity
Qatar Airways’ (Qatar) first A380 has begun operating scheduled flights between Doha and London fully ‘switched on’ with Mobile OnAir and next generation Internet OnAir in-flight connectivity services.
“Qatar Airways is one of the pioneers of in-flight connectivity on both long- and short-haul aircraft,” commented Ian Dawkins, OnAir’s CEO. “We are the only service provider with multiple inflight connectivity systems. We can therefore meet the airline’s connectivity requirements across all fleets.”
Dawkins continued, “Qatar Airways has provided connectivity for its passengers for nearly five years. Keeping passengers connected everywhere they fly around the world is an integral part of the airline’s exceptional cabin offering.”
OnAir claims that once Qatar’s nine other A380 aircraft are equipped with its platform-agnostic products, the company will have supplied over half of the world’s A380s with in-flight connectivity.
Virgin Atlantic live streams gig from on-board 787 Dreamliner
London-based bands Rudimental and Gorgon City are performing on-board Virgin Atlantic’s inaugural 787 flight from London to Atlanta, USA, with the gig being streamed live from the Atlantic Ocean via in-flight Wi-Fi to the website flightdecks.virgin-atlantic.com.
Rudimental's Amir Amor said, “We are all buzzing for this gig. We've played some pretty mental shows over the past 2 years but I think this is going to be a memorable one!”
After the event has been streamed, the audio will be available to listen to on SoundCloud’s website.
The 787 aircraft on which the gig is taking place, ‘Birthday Girl’, celebrates Virgin Atlantic’s 30th year with special paintwork featuring the iconic Virgin Atlantic ‘Flying Lady’ holding a champagne coupe!
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