Israeli flag-carrier El Al has fended off the impact of the Gaza conflict, posting a full-year pre-tax profit of $125 million, and a net of $117 million, after experiencing a strong fourth quarter.
El Al generated full-year revenues of $2.5 billion, a rise of 26%, while operating expenses only increased by 19% to $2.23 billion.
While the Gaza conflict triggered a substantial reduction in passenger traffic, El Al says it benefited from decisions by foreign airlines to suspend services to Tel Aviv and its own ability to adjust its network.
As a result, it states, the carrier experienced “increased demand” for flights which exceeded its early estimates and which – combined with other factors – had a “positive effect” on its fourth-quarter results.
El Al turned in a 21% rise in fourth-quarter revenues to $678 million and a net profit of nearly $40 million. It says the positive trend has continued into the first quarter of this year.
The airline points out that, after the outbreak of the conflict, it managed to add extra passenger and cargo services despite the drafting of “hundreds” of its personnel as reservists.
El Al adjusted its route network, ceasing flights over Omani airspace and to certain destinations, including Istanbul, Marrakech and Sharm el-Shaikh, and bringing forward termination of seasonal services to Marseille, Nice and Tokyo.
It also postponed the opening of Indian routes to Delhi and Mumbai and intends to suspend its Johannesburg service from March. The airline’s Sun D’Or operation has maintained an air bridge with Poland and Moldova by opening passenger flights to Warsaw and Chisinau.
Overall revenues from passenger flights rose 31% last year, while cargo revenues fell by 16%.
El Al attributes the decline in cargo income to increased belly freight capacity available on foreign passenger aircraft as well as significantly lower prices for sea transport.
But it states that cargo business has picked up substantially since the conflict began, as a result of lower foreign airline activity as well as the geopolitical situation in the Red Sea which has reduced sea freight demand from Israel.
