Kazakh major air carrier forecasts double decline in profits in 2012

Azerbaijan, Baku, May 18 / Trend E. Kosolapova/

Kazakhstan's national air carrier Air Astana may reduce the profits by half in January- December 2012, the company's President Peter Foster said, Novosti-KAzakhstan reported.

"According to my forecast, the airline will be profitable in 2012, but the level of profitability will be significantly lower than in the past two years... If the profit reaches 30 million, I will be very happy," Foster told journalists on Friday in Almaty.

Air Astana received 8.982 billion tenge (about $61 million) net profit in 2011 (a 21-percent decrease compared to 2010).

Moreover, Foster expects that the profit margins exceed 4.3 percent in 2012 compared to 8 percent in 2011. Meanwhile, this index is very good for the aviation industry, he said.

According to Foster, reduction of Air Astana's profitability reflects the general trend of the aviation industry.

"As we know, many airlines of Europe and Asia, which earlier were considered as very strong, have received negative indicators and forecasts recently," he said.

Moreover, one of the Air Astana's key problems is high cost of aviation fuel in Kazakhstan.

"In Kazakhstan, the problem is intensified by the fact that the issue is not only associated with price, but also with volumes, because Kazakh refineries do not produce enough jet fuel," he said.

Air Astana is Kazakhstan's largest airline. The company is a joint venture of Kazakhstan's Sovereign Wealth Fund Samruk-Kazyna (51 percent) and Britain's BAE Systems company (49 percent).