Air Seychelles transitions from ‘shaky past’ to ‘exciting future’ |25 March 2015

Air Seychelles has transformed itself from a little-known Indian Ocean airline to a confident national and international carrier, contributing solidly to the economic growth of the Republic of Seychelles, the airline’s chief executive Manoj Papa said yesterday.

“At the half-way mark of a five-year strategic partnership with our 40 per cent shareholder, Etihad Airways, Air Seychelles has introduced new aircraft and destinations, developed partnerships to increase flight connectivity, won several major awards and evolved from a carrier with an uncertain future to an important niche partner in a global airline network,” Mr Papa said.

His comments coincided with a visit to the Seychelles by the International Monetary Fund, which is conducting a periodic review of the nation’s economy.  
As part of this assessment, the IMF reviewed the airline’s profit and loss, balance sheet, and strategic plan.

While the airline’s management detailed to the IMF significant growth in the business and improvement in key indicators, the IMF observed that the airline had declared a profit at a net level, which includes all revenue and costs, but had incurred a loss at an operating level.   

The IMF expressed that Air Seychelles should also disclose financial results at an operating level, in addition to results at a net level.
Mr Papa said: “We have achieved three successive net profits, each of which have been audited in compliance with International Financial Reporting Standards by the global accounting group KPMG. In three years, we have invested significantly in developing Seychelles as a hub for traffic between East Africa, the Western Indian Ocean, the United Arab Emirates and the Indian sub-continent, and have launched routes to Paris, Antananarivo, Mumbai and Dar es Salaam. Each of these will typically take three years to cover their start-up and operating costs, in line with industry standards. Our business plan, from which we have not deviated, is well on track to achieving our long-term goal of healthy and sustainable operating profitability.”

The airline’s chairman, Joel Morgan, the Seychelles Minister for Foreign Affairs and Transport, recently endorsed the airline’s plan and progress on the occasion of the announcement of its 2014 financial performance, which resulted in a US $3.2 million net profit.

Mr Morgan said: “The government supports Air Seychelles’ strategy to operate a commercially sustainable and profitable airline by developing a strong and connected network, which meets the demand of both business and leisure travellers. With further significant financial support from its shareholders, we hope Air Seychelles can announce a further expansion of its network in its key markets as well as new markets in 2015, thereby increasing its economic contribution to Seychelles.”

Tourism accounts for approximately 20 per cent of the gross domestic product of the Seychelles, and some 15 per cent of the nation’s jobs.
“For the economy to be strong and resilient, Air Seychelles must continue to grow, to promote Seychelles internationally and to continue delivering tourists,” Mr Papa said.

“To do so requires us to constantly identify and act upon opportunities. Our next phase of growth will include introducing three nonstop flights per week between Seychelles and Paris, further strengthening the tourism industry and the broader economy of Seychelles. But our job is not finished, and with the continued strong support of our shareholders, we will build upon our successes of recent years to become an even stronger airline for the Seychelles, its people and the growing number of visitors we will bring to our home.”