Slovak discount airline SkyEurope announced Friday that it plans to drop two of its five hubs as a cost-cutting measure.
From late October onwards, the airports in Budapest and Krakow will stop serving as bases for the carrier and will fly only from Bratislava, Vienna and Prague, SkyEurope said in its Q3 report. The carrier, which is listed on Vienna’s stock exchange, also announced plans to reduce its European destinations, but intends to increase frequencies and offer more convenient departing times.
SkyEurope currently flies to 39 destinations in 19 countries. The discount airline reported Q3 losses of €5.24 million ($7.18 million), a reduction compared with €16.54 million ($22.66 million) net loss in the same period last year. Losses for the first 9 months of the 2006-07 business year fell from €50.2 million ($68.8 million) to €37.6 million ($51.5 million) in the year-on-year comparison. The company’s debts however increased from €79.5 million ($108.8 million) to €121.6 million ($166.5 million). SkyEurope remains heavily affected by high leasing costs for its 12 aircraft.
Operative earnings before interest, taxes, depreciation, amortization, share profits of associates and lease payments (EBITDAR) were €3.23 million, up from a negative EBITDAR of €7.09 million. Earnings before interest and taxes improved (EBIT) from minus €14.5 million to minus €5.2 million in Q3, and from losses of €48.8 million to minus €35.2 million in the first nine months of the year. Revenues increased by 26% to €66.6 million.
SkyEurope said it expected to report a positive EBIT for Q4. (m&c.com)