Jazeera Airways, a low-cost carrier based in Kuwait, has reported a net profit of KD15.4 million ($51.2 million) for 2015.

The airline reported positive results last year compared to figures recorded in 2014, when it posted a pre-transaction net profit of KD17.4 million ($57.9 million). However, as a result of a fleet sale, the company’s bottom line for 2014 was affected by a one-time non-recurring loss leading to a net loss of KD2.88 million ($9.5 million) for the year.

The airline’s operating profit for 2015 hit KD13.6 million ($45.2 million), reflecting a 2 per cent increase from 2014. Operating revenue for the year was KD58.6 million ($194.9 million).

Celebrating the success, the board of directors has recommended a 15 per cent cash dividend totalling KD3 million ($9.9 million).

Marwan Boodai, Jazeera Airways chairman, said: "I'm pleased to report that 2015 was another profitable year for Jazeera Airways, and a transformational one too. We successfully readjusted the airline's capital to match its size, issued record shareholder payouts worth KD52.7 million ($175.2 million) in cash, and settled all debts. Today, the company is debt-free, with over KD30.9 million ($102.7 million) in cash and a growing profitable business. The company's balance sheet has never been as strong as it is today."

Jazeera Airways started the year by announcing a divestment of its fully-owned leasing business, which had accounted for less than 20 per cent of its net profit in 2014, by selling its fleet of 15 Airbus A320s for $507 million. The sale led to a board recommendation to adjust the company's capital to match its current operation. On November 4, 2015, shareholders approved the recommendation to reduce the capital from KD42 million ($139.7 million) to KD20 million ($66.5 million) through a share buyback program of 220 million shares at the nominal share price of 100 fils.

This resulted in a KD22 million ($73.1 million) shareholder payout, which -- when combined with payouts during the year -- lifted total shareholder cash payouts during the year to a record payout of KD52.7 million ($175.2 million). Earlier in the year, the company had issued cash dividends of KD20 million ($66.5 million) for the year 2014 and a payout of KD10.7 million ($35.5 million) in accumulated earnings and other reserves that were required by law to be distributed as part of the capital reduction process. This voluntary share buyback program was the first exercise of its kind in Kuwait and was based on the procedures stated in Kuwait's new Commercial Companies Law (97/2013).

In 2015 the company successfully exited the aircraft leasing business to focus on the airline business, issued a record shareholder payout, settled all loans, grew the operating profit, increased the net profit, and attracted more passengers despite the political and economic challenges the region faced. The year 2015 was transformational for the balance sheet, and the airline expects 2016 to be the year this transformation extends to the product. – TradeArabia News Service