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Tue 28 Oct 2014 08:48 PM

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Saudi budget carrier suspends long-haul services

Chief executive of flynas says profits on the routes have not met expectations

Saudi budget carrier suspends long-haul services

Saudi Arabia's first and only budget airline, flynas, has suspended long-haul flights because profits on the routes did not meet expectations, chief executive Raja Azmi said on Tuesday.

"We had some issues from a financial standpoint in terms of the profitability of some of the routes..." Azmi told Reuters by telephone.

"We have taken a stand that we are suspending - not stopping - those routes for the moment and will relook at the whole situation again." He added that he could not yet say when long-haul flights might resume.

A statement posted on the airline's website said: "flynas has suspended all long-haul flight services on its Global Flight Routes Program, including all flights to London Gatwick."

In April this year, flynas said its growth strategy would focus on developing long-haul flights to five or six new destinations including London, Manchester, Kuala Lumpur and Jakarta, using the Red Sea city of Jeddah as a hub.

The airline, 37 percent owned by Saudi investment firm Kingdom Holding and the rest by National Airline Services Holding, said it expected to grow at least 20 percent annually and turn profitable in 2014 after seven years of losses since it was founded.

Azmi said on Tuesday that the carrier would now focus on expanding its short-haul services, and might look at a different model for long-haul flights at a later date.

All passengers who had booked flights on long-haul routes will be fully refunded or alternative flight arrangements on other airlines will be made on their behalf, flynas said.

Azmi said the costs of this would be manageable and the airline now expected to break even "probably next year".

The airline said it currently operated 950 weekly flights from Saudi Arabia to 25 domestic and regional destinations. In 2013, it carried 3.3 million passengers.

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