Kazakhstan’s Air Astana sees profit rebound in 2017

Air Astana hopes for the growth to continue in 2018 The carrier's transit traffic increased by 58% last year (Air Astana)

A combination of increased transit business and relatively low unit costs helped Air Astana to post a profit of US$39.1 million in 2017, returning the airline to profitability after its first ever loss in 2016.

Kazakhstan’s national carrier enjoyed a 12% passenger traffic growth and a revenue increase of 22% in 2017, after reduced performances in both 2015 and 2016 following the devaluation of the Kazakh tenge in mid-2015.

The airline carried 4.2 million passengers last year and recorded total revenues of $754 million. Its freight carriage grew by 23 per cent.

Peter Foster, Air Astana’s president and CEO, notes that the Astana EXPO 2017 event and increased transit business through the new terminal at Astana Airport were the main growth drivers: “EXPO was a great success and substantially exceeded its visitor target. Transit business grew by 58% and is now 12% of total business. Our comparatively low unit costs have enabled us to successfully grow this business segment by being competitive in key overseas markets, such as in Russia, China, India, and the EU, as well as smaller, high growth markets such as Ukraine, Georgia, and Uzbekistan.“

Air Astana’s capacity grew by 7% last year, with new routes added between Astana and Delhi and Astana and Kiev, and increased frequencies to Bangkok, Beijing, Dubai, Istanbul, London Heathrow, Moscow, Novosibirsk, Omsk, St. Petersburg, Seoul, Tashkent, Tbilisi, Urumqi, and Yekaterinburg.

The airline took delivery of a second Airbus A320neo family aircraft, an A321neo, and confirmed an order for five Embraer new-generation E2 regional jets, with deliveries starting from October 2018, bringing its total outstanding aircraft orders to 23 (15 A320neo family, five Embraer E2s, and three Boeing 787s).

Whilst growth is expected to continue into 2018, Foster cautions that the industry is currently operating at peak or near-peak capacity in most regions, and that costs, including fuel, airport, other user charges, and staff costs are under pressure: “Cost control, whilst maintaining quality standards, will be the key challenge in the coming period.”

Air Astana, which operates services to more than 60 domestic and international destinations from hubs at Astana and Almaty, commenced operations in May 2002, and has since built a fleet which now consists of Boeing 767s, 757s, and A320s (including A320neo and A321neo versions), as well as Embraer E190s.

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