Loss-making carrier says workforce has been cut by 25% as part of restructuring plan
Bahrain's Gulf Air said on Saturday that its restructuring strategy was on track after reducing its overall losses by more than 50 percent in the first half of 2013 compared to the same period last year.
The airline said in a statement that this was achieved primarily through a 26 percent reduction in year-on-year costs across the organisation and bolstered by sound revenue results aided by a Q2 yield increase of over six percent.
As part of the restructuring plan, Gulf Air said it has cut its total workforce by 25 percent year-to-date.
Gulf Air said it performed 15 percent ahead of its financial target in the first six months of the year.
The carrier added that it "expects to realise additional improvements as it continues to remove excess operational cost from the organisation, renegotiate contracts with certain vendors and suppliers and fine-tune the network".
Chairman Sheikh Khalid bin Abdulla Al Khalifa said: "Gulf Air's restructuring is firmly on track, strengthening the airline's position as a key national infrastructure asset and supporting the Kingdom's evolving business needs while freeing additional treasury resources for domestic investment."
He added: "The board of directors remain optimistic about the future performance of Gulf Air based on the results to date."
Kamal bin Ahmed Mohammed, minister of transport and chairman of Gulf Air's executive restructuring committee said: "Gulf Air's results, achieved in an operating environment characterised by volatility and severe competition, reflect a significant achievement for the airline and demonstrate the effectiveness of the restructuring strategy.
"Much has been done, yet there is still much more to do. While the operating environment remains challenging, we are committed to the continued implementation of this restructuring plan."
He said the main priority over the next six months is to further reduce operational costs and increase sales efficiency.
Gulf Air said it has now completed the realignment of its fleet to match its new network requirements.
"The revised all Airbus mixed fleet, consisting of 26 aircraft, allows the airline to better match capacity with demand in certain markets facilitating more effective competition," the statement said.