The national airline "To Montenegro" lost a few million euros due to the entry of the Turkish low-cost company "Pegasus" on its flights, and this resulted in a slightly worse result in the first quarter of this year compared to the same period last year, but according to the first estimates, around 250 thousand euros in profit was achieved. This was announced by the President of the Board of Directors of "To Montenegro" Tihomir Dragaš in an interview with TV Vijesti.
He said that the national airline ended last year with a profit of three and a half million. This year, "Air Montenegro" will fly to four new destinations - Izmir, Baku, Munich and Ostrava, which, in addition to preparing for the expansion of the fleet, caused additional employment, so now the total number of employees is 180, i.e. 30 more compared to the same period. last year.
"In 2023, the national airline realized 3.532 flights and transported 475.000 passengers and made a profit in the amount of about 3,5 million euros, and the EBITDA was in the amount of about 5,6 million euros, which is one of the best results of national airlines, including and the previous one. Although it is still relatively early for the presentation of the results achieved in the first quarter of 2024, we can currently say that 'Air Montenegro' has realized 739 flights and transported around 52.000 passengers in the mentioned period. For comparison, last year we realized 769 flights and transported about 54.500 passengers, which is a worse result by about 2.500 passengers this year, however, that bad result is due to the number of realized flights and transported passengers to destinations in Turkey. Although this year from January, i.e. in the first quarter, we flew on the routes Podgorica-Zurich and Podgorica-Rome, the projection of profitability in the first quarter is such that we made a profit of around 240.000, that our liquidity is extremely high, that free cash flow in the first quarter of this year was around 3,2 million euros," says Dragaš.
How does the return of low-cost airlines and competitiveness to neighboring airports affect the development and operations of the national airline?
Honey: We plan to make a significant increase in the number of transported passengers this year. Last year, an official in the Ministry of Capital Investments signed a memorandum of understanding with the Turkish aviation authorities, making open sky so-called politics. That memorandum of understanding is a completely illegal act, which did not pass the government authorities. In cooperation with them and the agreement, that is, the negotiations we had, in which we were involved with the Turkish aviation authorities, we limited the number of possible routes from the first quarter. From April 15, 2024, "Pegasus" will not fly on the route Istanbul - Podgorica or Istanbul - Tivat.
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At this point, can we talk about how much that loss was or some estimate and whether the national airline will be compensated in some way?
Honey: It is about a couple of million euros. At the time when "Pegasus" entered, the agreement that would indemnify the company at that time was made that "Pegasus" would pay the national airline ten euros per transported passenger, which is a significantly lower amount compared to the amount it would have been if the national airline transported those passengers. We did not problematize the issue of compensation at this time because our primary concern, and that was our focus, was to annul that memorandum and to put it out of force.
It was announced that the fleet of "Tu Montenegro" will be increased from two to three aircraft in its ownership, plus two in lease. Has that work been completed, and if not, when and under what conditions?
Honey: Currently, the company has a fleet of four aircraft, two owned by the company. Negotiations are ongoing regarding the expansion of the fleet for an additional aircraft, but I cannot tell you more about the details at this time. Will it be this year? Very likely, yes.
Was five million paid to the Brazilian bank for the plane Charlie, owned by the former "Montenegro Airlines" and how will that plane be used?
Honey: Taking into account that the plane is not owned by the national airline, but by the state, I cannot speak with exact data. I am in possession of some unofficial information that the state has in fact assumed this obligation so that the bank guarantee would not be activated, the plane is on the runway at Podgorica airport, it is in an open area and we will definitely talk to the Ministry of Transport and Maritime Affairs in the coming period in order to agreed on how to put that plane into operation and in the fleet and what kind of contract to make with the Ministry, in order to avoid all speculations regarding state aid
Will there be any new flights established this year, and if so, to which destinations?
Honey: We made the decision to open four additional destinations this year, and those destinations will be in operation during the summer season. So we will have the opening of a new destination between Tivat and Izmir already on April 5. We are also opening the Tivat-Baku and Podgorica-Munich and Podgorica-Ostrava lines from June. The board of directors approved the proposal of colleagues to change the new reservation system. And that new reservation system will enable us to open a coach contract, considerable flexibility when selling tickets, and the option to buy a ticket without baggage. We will be able to sell a ticket from here to New York through Turkisha when we make a coach contract with Turkisha or through Lufthansa.
How many employees does the company have and is that number higher or lower compared to the previous year?
Honey: We have employees under indefinite, fixed-term employment contracts, part-time contracts, temporary and casual jobs, at the end of the first quarter of this year it is 181 and is 30 more than in the same period last year. The reason for this is the opening of new destinations and preparations for the introduction of an additional aircraft into the fleet of the national airline.
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