Kuwaiti low-cost carrier Jazeera Airways will delay a secondary stock market listing in Dubai, planned for this later year, because of poor market conditions, its chief executive said on Wednesday.
Marwan Boodai also said the company, which listed its shares earlier this year, was maintaining its 4 million Kuwait dinar ($14.8 million) profit target despite the global financial crisis which has hit airlines.
The company, which hopes to fly 82 routes in the Middle East within the next five years, had planned to list outside of Kuwait, in part to boost its profile, Boodai told the summit which is taking place at newswire Reuters offices in the Gulf.
“The original plan was for a secondary listing on the Dubai stock exchange targeting the fourth quarter,” he said. “But because of the situation in the UAE we don’t think the timing was good, and we don’t need the capital.”
Jazeera would delay the listing to 2009, he said, without giving further details.
Dubai’s main stock index has fallen about 50 percent this year.
Jazeera, which said it was looking to add Cairo to its regional destinations this year, could withstand the global financial crisis which has led to capacity cuts and aircraft groundings around the world, he said.
“We can’t say we are totally immune but as for the business model of Jazeera we are more focused on the Middle East point-to-point. That is where we want to be in the future and the impact for us will be less.”
Demand from the large foreign workforce in the Gulf Arab region, lack of competing transport routes between the desert countries and gross domestic product growth as governments spend oil revenues, would drive the regional business, he said.
The company would likely post a net profit of about 4 million dinars in 2008, he said, without giving a comparative figure.
A leasing company set up by Jazeera’s founders would stick with an order next year of up to 50 planes from Airbus and Boeing despite prospects of slower growth in global economies, he said.
The $375 million aircraft leasing company, called Shabab Aircraft Leasing Co, would make a first order by mid-2009 of narrow-body A320 and B737 planes in a deal worth $3 billion, Jazeera has said.
“We are sticking to our original plan,” Boodai said.
Jazeera had ordered 34 additional aircraft to be delivered by 2014, Jazeera said in May. (Reuters)
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