fastjet Interim Executive Chairman and Chief Executive Ed Winter
Africa’s low-cost airline, fastjet, took delivery of its first owned aircraft on 25 September 2015. The intent to purchase this aircraft, the sixth aircraft in the fastjet fleet, was announced on 26 August 2015 and the agreement was signed on 23 September 2015.
According to the company, the aircraft, an Airbus A319 (Manufacturer’s Serial number 2891), was purchased from an entity managed by BBAM US LP (BBAM), a leader in commercial aircraft leasing, financing and management, headquartered in San Francisco, CA. The market value of the aircraft is approximately USD15.5m and the aircraft was purchased at a discount to the market value with the consideration being satisfied in cash.
Ed Winter fastjet CEO said this is an exciting moment for the company with the aircraft not only being the first that ‘we have purchased but also that it marks a doubling in the size of our fleet over the past few months’.
“I am particularly pleased that we have purchased this aircraft from BBAM who showed confidence in the Company by leasing the first aircraft to fastjet in 2012. This aircraft has been earmarked to be the first in the fastjet Zambia fleet and following reconfiguration and painting is expected to be flown to Lusaka, Zambia in early November,” Winter said.
The company stated an intention to create a mixed fleet of leased and purchased aircraft at the time of the fundraising in April 2015. fastjet was advised by SkyWorks Leasing in the purchase of this aircraft.
According to the airline’s interim results for the six months ended 30th June 2015, fastjet Tanzania revenues were US$31.5 million (H1 2014 US$19.0 million) while first half losses before tax of US$9.0 million (H1 2014 US$13.9m).
Winter said using the same assets as in H1 2014, three Airbus A319s, in H1 2015, through better utilisation we increased the number of seats flown by 56 per cent, total revenue increased by 66 per cent and operating losses reduced by 26%; a great achievement.
“Whilst we have seen these very significant improvements, African currencies have lost considerable value against the US dollar, which combined with a worldwide reduction in commodity prices, has caused an economic downturn in both Tanzania and Zambia. In addition, the start of operations in Zambia and Zimbabwe has been delayed into Q4. Accordingly the Board has downgraded its forecast for full year 2015 but is confident of meeting its expectations for 2016”.
“As a result of slower than anticipated route development and the impact of weak African currencies, in particular the Tanzanian Shilling (TZS) against the US dollar, we now expect trading in the second half of 2015 to be materially behind management’s expectations,” added Clive Carver, fastjet Interim Chairman.
