UTair Group returns to profitability

UTair is once again in level flight UTair is once again in level flight (Photo by UTair)

At the end of 2015, UTair Group managed to get back in black ink. According to the group’s 2015 financial report, its net profit amounted to 2.274 billion rubles ($35 million), against the net loss of 61.659 billion rubles in 2014. The group includes Russia’s third largest passenger airline — UTair Aviation and the country’s largest helicopter operator — UTair Helicopter Services.

Revenue generated by helicopter operations and passenger operations declined from 74.690 billion rubles to 68.875 billion rubles (–8.2%). Pre-tax profit from passenger operations reached 15.213 billion rubles in 2015 against the 46.993 billion ruble loss in 2014. Helicopter operations remain in the red, although the pretax losses reduced 74.8% from 20.052 billion rubles in 2014 to 5.048 billion rubles in 2015.

The group’s operational activities generated 5.035 billion rubles profits, whereas in the previous year the operation losses amounted to 10.853 billion rubles.

At the end of 2015, the group’s short-term obligations reduced by 75.1%, from 109.941 billion rubles to 27.385 billion rubles. At the same time, the amount of long-term obligations almost tripled to 79.254 billion rubles.

The main negative factors the group had to withstand in 2015 were ruble devaluation, which lead to skyrocketing leasing prices and ground handling expenses, as well as a plunge in demand for air transport services, especially in the revenue-generating international segment, the report states, also mentioning charter program cuts and tour-operator bankruptcies.

In 2015, the group restructured its bank credit and bill debt obligations with a syndicate consisting of 11 banks. The process of restructuring leasing payments is ongoing. Last year, the group managed to settle its debts, restructure its leasing payment schedules, and extend leasing agreements with most of its lessors. The process is expected to be completed by the third quarter of 2016.

UTair airline reported on its financial results earlier. According to Russian accounting practices, its net loss in 2015 decreased 17.4% to 18.426 billion rubles, including helicopter operations. Income reduced by 30% to 49.665 billion rubles. The reduction was evident in both the helicopter and passenger operation segments.

 

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