AIR Zimbabwe narrowed its full year losses by 42 percent to $15 million in 2016 from $26 million the previous year as a result of cost cutting, the state-owned airline’s chief executive said on Monday.
Air Zimbabwe chief executive Ripton Muzenda on Monday told a Parliamentary committee that the airline was this year targeting to increase revenue to $47 million from $36 million if it manages to resume long haul flights, particularly the lucrative Harare-London route.
The airline last operated the route in 2012 when it was expelled from the International Aviation Transport Association (IATA) clearing house after accumulating fee arrears.
That debt now stands at $3.5 million.
IATA facilitates payments between airlines and other businesses in air travel.
Muzenda said the airline had given itself a May target to pay up the debt and acquire the mandatory certification required to operate the London route.
“We intend to change the way we are operating and hope to launch long haul flights, which will be key in driving revenue…there is so much demand for London……we need to sort out our debt obligations and address regulatory compliance issues and also revamp our aircraft so that we are competitive,” he said.
Muzenda said the organisation’s workforce now stands at 425 after a restructuring exercise last year, which saw 299 employees being retrenched. The airline’s current headcount gives it an employee to aircraft ratio of 70.83, below a globally accepted industry average of 195.
“We have been cutting costs at every opportunity we get and pursuing revenue. We did a lot of promotions to increase the load factor but it is still quite low at 42 percent, if we can just bring it up it will really improve performance,” he said.
Government, the shareholder in Air Zimbabwe, has been scouting for a technical partner to help turn around the struggling company whose $330 million debt could be taken over by the state.
According to the 2015 report by the Auditor General (AG), the state used revenues from vehicle number plate sales to inject over $30 million into Air Zimbabwe.
– The Source.