Vnukovo's nine month figures don't give much reason for optimism for Russia's number two carrier

Published: 11/5/1999

Troubled carrier Vnukovo, Russia's second largest carrier and controlled by the Russian Aircraft Consortium, has published its first 9-month figures for 1999, which show no top line relief for the struggling airline. The 61% decline in sales in dollar terms over the period, to $41m from $107m in 1998, show the impact of the crisis and the devaluation of the ruble, although sales increases of 5% in ruble terms, reflect some ability to increase fares during the period, despite declines in volume. Costs, which declined by 59% in dollar terms and rose 11% in ruble terms, so outstripping revenue growth, reflect the squeeze of increasing costs, primarily of fuel, against a background of lower volumes, offset only slightly by increases in fares. Operating losses declined in dollars for the period, but rose by 57% in ruble terms. The airline has recently embarked on a restructuring program, with the first redundancies announced in the last few days by the airline's new General Director, former Aeroflot director, Alexander Krasnenker (www.concise.org 25th October 1999). The company has reported that it expects to carry 1.4 m passengers in 1999, down from 1.5m in 1998, although some reports have suggested passenger declines of 30% in 1999, when compared with 1998.

Article ID: 1055