Ethiopian clinches record profit despite 787 grounding: CEO

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The national flag carrier Ethiopian Airlines has pocketed a record profit during the just concluded fiscal year, Capital learnt.

The surge in revenues comes despite the grounding of Ethiopian’s Boeing 787 Dreamliner planes.
Ethiopian Chief Executive Officer Tewolde Gebremariam says that his company is awaiting final performance report for its accounting period that ended Sunday, June 30.
“Our accounts are working on the final numbers…but it’s been very, very successful year. We are going to register our historical record level of profit and again with 20-25 percent growth in revenue and number of passengers,” said Tewolde.
Tewolde said during the 12 months Ethiopian was significantly affected due to the grounding of its 787 planes that lasted for more than three months. In January the U.S. Federal Aviation Administration grounded the aircraft after incidents with smoldering batteries on two different planes. Ethiopian has similarly grounded the plane as precautionary move.
“It’s very unfortunate the aircraft was grounded. The flight was grounded when the aircraft had no problem with us, we didn’t like it but we had to accept as an international rule,” Tewolde said.
“During the grounding we were parking four airplanes on the ground, for an airline of our size it means a lot in terms of operational disruption, and financial impact… loss of revenues, and commercial impact,” he added.
Ethiopian is seeking to be compensated and has already notified Boeing the financial loss it incurred due to the grounding, the CEO also said. He explained that Boeing “acknowledged” their request and the two will work “to help each other in the long partnership” they have.
During the 2011/12 period Ethiopian pocketed an operating profit of one billion birr carrying 4.6 million passengers. The period was marked by an oil price hike during which the airliner was the only carrier in the continent that remained in the black.
The latest figures show that both revenues that stood at 33.8 billion birr last year and number of passengers have grown upwards. The latest performance shows the airliner carried 6 million passengers and 200,000 tons of cargo during the 12 months.
Ethiopian says it has remained in the black due to cost saving schemes and successful new routes. On Monday the chief executive along 160 passengers took the company’s first flight to South America on one of the 787 Dreamliners. On the occasion Ethiopian became a first carrier to take the ultramodern aircraft to Brazil.
“I am not sure but I think we are the only profitable and fast growing airline in Africa this year as well. Now with new services to Sao Paulo and Rio de Janeiro, which we operate through our second hub in Lome, Togo, we have become a first African carrier to connect West Africa to South America,” the CEO said before boarding on the flight he said will take 13 hours to reach in Brazil.
The CEO says they are particularly targeting the China-India-Africa-Brazil trade lane with the new services.
“The China-India-Africa-Brazil trade lane is the fastest growing in the world. Our new Brazil flights will provide efficient connections with 28 weekly flights to 4 destinations in China, 14 weekly flights to the 2 major cities in India, daily flights to Lebanon, five weekly flights to Tel Aviv and almost daily flights to 45 cities across Africa,” he explained.
Based in Addis Ababa, Ethiopia is currently operating an all-Boeing fleet of 60 planes. It flies to 75 international and 17 domestic destinations.
Kirubel Tadesse is a freelance journalist and Associated Press writer based in Addis Ababa.