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ETinCaribe
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Ethiopian reports FY financial results and other developments

Sun Aug 12, 2018 8:15 am

ET reported its financial year results a couple of days ago:

https://www.ethiopianairlines.com/corpo ... test-press

Highlights:

    Total Rev: $3.2 billion
    Net Profits: $244 million
    10.6 million passengers transported - up 21% y/y and first time over 10M
    400,000 tons of freight - up 18% y/y
    14 new planes
    8 new international destinations

So, yes, ET is killing it! Their African expansion is continuing with the Chadian Airlines, Ceiba in Equatorial Guinea, and as the CEO said: they are one of the front runners to run Nigeria Air (he doesn't believe in jinx I presume)...

Other noteworthy news:

[*]The CEO is suggesting selling minority stakes to other African governments https://www.nation.co.ke/news/africa/Et ... index.html

So ET will be officially the new Air Afrique (with profits).

[*] ACC-LGW is being worked out

[*] The Mozambique subsidiary is to be called Ethiopian Mozambique Airlines - they are not looking for points in creativity.

[*]ET Cargo to fly Norwegian salmon to China: https://www.businessdailyafrica.com/new ... index.html

[*]New stopover package launched by ET Holidays. https://aeronauticsonline.com/ethiopian ... r-package/ I think they should also look at reducing the visa fees to make it more attractive.

All good news for ET. They are a juggernaut that is seemingly unstoppable. I wish they would try to launch an airline in the DRC and really work on creating a separate brand such as ASKY that they can use in every market they enter. This is a la LAN in the past or LATAM and Avianca now. They will also need to put much more focus on customer service which has major weaknesses (social media is full of such reports).

What do you all think??
 
aviationaware
Posts: 2858
Joined: Mon May 19, 2014 12:02 pm

Re: Ethiopian reports FY financial results and other developments

Sun Aug 12, 2018 8:23 am

Any information on their cash flows? Their last annual report is from 2016.
 
LGAviation
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Joined: Thu Jul 30, 2015 10:14 am

Re: Ethiopian reports FY financial results and other developments

Sun Aug 12, 2018 9:10 am

ETinCaribe wrote:
So, yes, ET is killing it! Their African expansion is continuing with the Chadian Airlines, Ceiba in Equatorial Guinea, and as the CEO said: they are one of the front runners to run Nigeria Air (he doesn't believe in jinx I presume)...


Nigeria and Nigerian domestic flying in the long run will be the gem that everyone should be looking for. With Ceiba and Chadian, I am not too sure if getting a mini-hub in every single African market is something that should be doing. With Lagos around the corner, I don't think it would be too wise to have both a Nigerian and CEIBA operation.

ETinCaribe wrote:
[*]The CEO is suggesting selling minority stakes to other African governments


Might open markets but keep them minor in order for them not to be able to influence business decisions and thereby ruin the company.

ETinCaribe wrote:
ACC-LGW is being worked out


Smart move, opens the ET brand in West Africa to intercontinental traffic to Europe in addition to their Togolese operation to Newark.

ETinCaribe wrote:
The Mozambique subsidiary is to be called Ethiopian Mozambique Airlines - they are not looking for points in creativity.


Smart move, in the end the brand recognition of ET Mo will be so much better than that of a Mozambique Airlines or that of Malawi Airlines

ETinCaribe wrote:
New stopover package launched by ET Holidays. https://aeronauticsonline.com/ethiopian ... r-package/ I think they should also look at reducing the visa fees to make it more attractive.


That might really help also in generating future higher yielding O&D. When I first flew through Addis back in 2012, the visa fee was $20 and we had to negotiate with border guards whether they'd let us out without a hotel (we were arriving from Tanzania in the early morning and continuing onward to Europe in the late evening) since they had never heard of that concept before. Interestingly, the discussion only started at the immigration counter after we had already been issued our visas. I connected a couple of times in the past years to Comoros or Rwanda and yes that visa fee of $50 is now more discouraging towards brief strolls in the city (in the end you end up paying a lot more with probably $80 for a taxi for the day, realistically another $50 for meals and some admissions so I don't see why you would want to discourage that). I really like the Kenyan model with that $20 transfer visa available.


Also did he say if they want to improve facilities at ADD. With long layovers, food options are still extremely limited and internet virtually nonexistent, even in the lounges. Also, their Star Gold lounge still is underwhelming.
2018: ADD CPH DAR DEN DME DUB FRA HAH HAM IST JIB KEF LYR MEL OSL PEK PKC PVG RAK STN SVO SYD YVR
 
The777Man
Posts: 6125
Joined: Sun Jul 04, 1999 4:54 am

Re: Ethiopian reports FY financial results and other developments

Sun Aug 12, 2018 9:11 am

Very nice to see that they are doing well.

Can you give me more info about their cooperation with Ceiba ?

Thanks !

The777Man
Boeing 777s flown: UA, TG, KE, BA, CX, NH, JD, JL, CZ, SQ, EK, NG, CO, AF, SV, KU, DL, AA, MH, OZ, CA, MS, SU, LY, RG, PE, AZ, KL, VN, PK, EY, NZ, AM, BR, AC, DT, UU, OS, AI, 9W, KQ, QR, VA, JJ, ET, TK, PR, BG, T5, CI, MU and LX.. Further to fly.. LH 777
 
81819
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Re: Ethiopian reports FY financial results and other developments

Sun Aug 12, 2018 10:21 am

Considering Ethiopia's proximity to the UAE and Qatar, their success and subsequent expansion suggest there is still latent demand for carriers in the region.

My initial thoughts about the misfortunes of Etihad revolved around the ME3 reaching a structural market ceiling. I think I may have to change those thoughts.

I wonder what is driving this growth. It could revolve around a strategy if developing partnerships with the African states.
 
LGAviation
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Re: Ethiopian reports FY financial results and other developments

Sun Aug 12, 2018 10:25 am

travelhound wrote:
Considering Ethiopia's proximity to the UAE and Qatar, their success and subsequent expansion suggest there is still latent demand for carriers in the region.

My initial thoughts about the misfortunes of Etihad revolved around the ME3 reaching a structural market ceiling. I think I may have to change those thoughts.

I wonder what is driving this growth. It could revolve around a strategy if developing partnerships with the African states.


ADD is still more than four hours from any of the ME3 hubs and serves a significantly different market. It essentially only really competes in Africa-Asia and South America-Asia with them. In Europe-Africa, the ME3 are too far east and ET has considerable advantages although ADD itself is located too far east for some markets.

Intra-African demand should however be where the future lies and in that the ME3 can't compete.
2018: ADD CPH DAR DEN DME DUB FRA HAH HAM IST JIB KEF LYR MEL OSL PEK PKC PVG RAK STN SVO SYD YVR
 
SCQ83
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Re: Ethiopian reports FY financial results and other developments

Sun Aug 12, 2018 10:59 am

Which is the full list of African airlines where ET has investments?

Also, is there any airport home of any of those airlines that can replicate ET's model? I reckon the main issue with creating a hub in Africa is deficient infrastructure.
 
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nordikcam
Posts: 94
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Re: Ethiopian reports FY financial results and other developments

Sun Aug 12, 2018 11:32 am

SCQ83 wrote:
Which is the full list of African airlines where ET has investments?

Also, is there any airport home of any of those airlines that can replicate ET's model? I reckon the main issue with creating a hub in Africa is deficient infrastructure.

Starting with Addis Abeba...
 
Samrnpage
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Re: Ethiopian reports FY financial results and other developments

Sun Aug 12, 2018 11:57 am

Incredible airline, really not sure how they are pulling off a fleet of 100 planes with 50 widebodies out of africa. They even have 4 399 seater 777-300ERs.
 
smi0006
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Re: Ethiopian reports FY financial results and other developments

Sun Aug 12, 2018 12:20 pm

WHat are the mid to long term plans for the airport? Wikipedia shows a recent expansion should have opened in June - did this go ahead?
 
Blerg
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Re: Ethiopian reports FY financial results and other developments

Sun Aug 12, 2018 1:44 pm

Congrats to Ethiopian, hopefully they don't expand to fast for their own good.

Sorry for going off topic but how is Fastjet doing? I remember reading somewhere that they were struggling.
 
iadadd
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Re: Ethiopian reports FY financial results and other developments

Sun Aug 12, 2018 3:57 pm

smi0006 wrote:
WHat are the mid to long term plans for the airport? Wikipedia shows a recent expansion should have opened in June - did this go ahead?


It's starting to open up in phases; they recently opened up ground level bus gates on the eastern expansion; 4 new jet bridges should come next. Followed by 2 new jet bridges on Western expansion and probably some more bus gates towards the end of year/beginning of next year. Finally the new Check-in area will open and result in a large centralized security screening eliminating the current time-consuming screening at gates.
 
Varsity1
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Re: Ethiopian reports FY financial results and other developments

Sun Aug 12, 2018 4:49 pm

Samrnpage wrote:
Incredible airline, really not sure how they are pulling off a fleet of 100 planes with 50 widebodies out of africa. They even have 4 399 seater 777-300ERs.


With SAA on the ropes, they are the only reliable intl airline on the continent.
"PPRuNe will no longer allow discussions regarding Etihad Airlines, its employees, executives, agents, or other representatives. Such threads will be deleted." - ME3 thug airlines suing anyone who brings negative information public..
 
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thekorean
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Re: Ethiopian reports FY financial results and other developments

Sun Aug 12, 2018 4:58 pm

I think they fly nonstop to ICN now, and then to NRT.

Is there a load restrictions considering ADD is one of those cities with hot climate and high altitude?
 
mr02
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Re: Ethiopian reports FY financial results and other developments

Sun Aug 12, 2018 6:18 pm

@Varsity1 SAA is still as reliable as Ethiopian maybe more but in terms of revenue and profits Ethiopian shadows it.If you look at the skytrax award SAA won Best Airline Staff; Best Business Class Lounge, Best Cabin Crew and Best Airline Cabin Cleanliness. Ethiopian only won best African airline. Its still a good airline(Ethiopian) but you should say how is it unreliable(SAA).
 
iadadd
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Re: Ethiopian reports FY financial results and other developments

Sun Aug 12, 2018 6:40 pm

mr02 wrote:
@Varsity1 SAA is still as reliable as Ethiopian maybe more but in terms of revenue and profits Ethiopian shadows it.If you look at the skytrax award SAA won Best Airline Staff; Best Business Class Lounge, Best Cabin Crew and Best Airline Cabin Cleanliness. Ethiopian only won best African airline. Its still a good airline(Ethiopian) but you should say how is it unreliable(SAA).


ET won Best Business Class, Best Economy Class
 
mr02
Posts: 190
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Re: Ethiopian reports FY financial results and other developments

Sun Aug 12, 2018 6:48 pm

@iadadd,fair enough. So we can say in terms of services both airlines are good but in terms of finances ET takes the cake.
 
airbazar
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Re: Ethiopian reports FY financial results and other developments

Tue Aug 14, 2018 12:51 pm

Samrnpage wrote:
Incredible airline, really not sure how they are pulling off a fleet of 100 planes with 50 widebodies out of africa. They even have 4 399 seater 777-300ERs.

This image should offer a good perspective on "how":
https://goo.gl/images/hPz6B8
There are essentially 3 major carriers in Africa: ET, SA, and MS. MS is going through a rough time, and SA is hubbed at the far end of the continent with few convenient connections.
 
ScottB
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Re: Ethiopian reports FY financial results and other developments

Tue Aug 14, 2018 3:49 pm

SCQ83 wrote:
I reckon the main issue with creating a hub in Africa is deficient infrastructure.


Arguably the biggest issue with creating a hub in Africa is the endemic corruption in so many countries. The lack of a predictable rule of law and the constant need to grease the wheels with cash and/or hires of some official's relative(s) for do-nothing jobs make it incredibly difficult to run a profitable free-market enterprise: See the issues facing SA in one of the continent's wealthiest and best-developed markets. A Nigerian carrier could be a powerhouse but for the corruption.
 
berari
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Re: Ethiopian reports FY financial results and other developments

Tue Aug 14, 2018 3:53 pm

iadadd wrote:
smi0006 wrote:
WHat are the mid to long term plans for the airport? Wikipedia shows a recent expansion should have opened in June - did this go ahead?


It's starting to open up in phases; they recently opened up ground level bus gates on the eastern expansion; 4 new jet bridges should come next. Followed by 2 new jet bridges on Western expansion and probably some more bus gates towards the end of year/beginning of next year. Finally the new Check-in area will open and result in a large centralized security screening eliminating the current time-consuming screening at gates.


Do you know how many gates the eastern bus gate expansion gave them? How are they setup/configured? ADD airport is very stale, has echos with announcements and the security check spots are atrocious. The expansion and use of the new space will be quite welcomed.
 
berari
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Re: Ethiopian reports FY financial results and other developments

Wed Aug 29, 2018 4:08 pm

Ethiopian has received its second B737 Max 8: https://twitter.com/ETWatch/status/1034479028231536640
 
toxtethogrady
Posts: 1861
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Re: Ethiopian reports FY financial results and other developments

Wed Aug 29, 2018 4:16 pm

What has happened to rumors of ADD-LOS-IAH?
 
berari
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Joined: Wed Jul 06, 2016 3:47 pm

Re: Ethiopian reports FY financial results and other developments

Thu Aug 30, 2018 10:11 pm

Ethiopian Cargo now flies to Miami ...

https://twitter.com/ETWatch/status/1035235927189118976
 
berari
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Joined: Wed Jul 06, 2016 3:47 pm

Re: Ethiopian reports FY financial results and other developments

Thu Aug 30, 2018 11:44 pm

Ethiopian is on a roll. Just took delivery of a freighter

https://twitter.com/etwatch/status/1035 ... 57504?s=21
 
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Miami
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Re: Ethiopian reports FY financial results and other developments

Fri Aug 31, 2018 12:41 am

For what its worth, their CEO is coming to Miami next month. Could be about their new cargo service but not sure why he would come for that.
Aviation is proof that given, the will, we have the capacity to achieve the impossible. - Eddie Rickenbacker
 
DGVT
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Re: Ethiopian reports FY financial results and other developments

Fri Aug 31, 2018 1:26 am

Something that has always made me wonder is:

1.) ADD lies at 2300 meters. Although temperatures aren't extreme, I assume the altitude combined with the temperature has a negative effect on aircraft performance.
-> Shouldn't this be a competitive disadvantage for ET?

2.) ET has a very diversified LH fleet. I‘m not quite sure how efficient it is to operate 77Ws, 77Ls, 789s, 788s, 763s and A359s for an airline with ~100 aircraft. Wouldn’t it be more efficient to concentrate on two LH types? I assume ET bought the 77L because ADD limits the range/payload of other types. I was under the impression the 77L is rather inefficient compared to current models.
-> Again, Shouldn't this be a competitive disadvantage for ET?

3.) I understand that Ethiopia is „booming“ for an African country (although the rapidly rising external debt makes me wonder if growth is sustainable). GDP is high for African standards, mainly due to Ethiopia's size of population. GDP p.c. however is only average for Africa. This makes me wonder how O&D yields look like. I don't imagine ET having a lot of premium passengers. If it's not O&D that's bringing in the money, but transit passengers, how do yields look like there (especially considering the competition)?

4.) Finally, while ADDs location is great for a transit hub, I would say the ME3/TK also offer good connections between Africa and Asia/Europe. I'd also say that they have a better product. How is ET able to compete with these airlines?

So all in all, I wonder if ET's rapid expansion is sustainable?

Please correct me if I have made wrong assumptions.
 
behramjee
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Re: Ethiopian reports FY financial results and other developments

Fri Aug 31, 2018 1:32 am

berari wrote:
Ethiopian Cargo now flies to Miami ...

https://twitter.com/ETWatch/status/1035235927189118976


What’s the routing please
 
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Miami
Posts: 6180
Joined: Sat Sep 15, 2012 8:37 pm

Re: Ethiopian reports FY financial results and other developments

Fri Aug 31, 2018 4:48 am

behramjee wrote:
berari wrote:
Ethiopian Cargo now flies to Miami ...

https://twitter.com/ETWatch/status/1035235927189118976


What’s the routing please

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