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Regional Express (Rex) says an improving Australian economy and more activity in the fly-in/fly-out (FIFO) sector will underpin a 20 per cent improvement in full year profit in 2017/18.
Deputy chairman John Sharp told shareholders at the company’s annual general meeting (AGM) in Sydney on Tuesday the recovery in the market towards the end of 2016/17 had continued into the current year.
Further, Rex’s passenger numbers for the first four months of 2017/18 was up four per cent compared with the prior corresponding period.
“The performance of the first trimester of this financial year appears to confirm the recovery trend noticed in the prior financial year,” Sharp said in prepared remarks.
“We also expect a firm increase in FIFO activities for Pel-Air in addition to new contracts confirmed at the tail end of the prior financial year.
“Overall we are confident that Rex Group will continue to perform stronger if the Australian economy continues on its modest recovery.”
Rex said in a slide presentation at the AGM its unaudited financial accounts indicated profit before tax for the first four months of 2017/18 was up 60 per cent from the prior corresponding period.
Meanwhile, “full year PBT was expected to exceed the prior financial year by over 20 per cent”, the company said, with the board reaffirming its commitment to a “healthy dividend payout ratio if the group achieves its profit target in FY18”.
Rex said it added one Saab 340B to its fleet since July 1 2017 “for increased work”.
In August, Rex reported statutory net profit after tax of $12.62 million for the 12 months to June 30 2017, a return to the black following a net loss of $9.56 million in the prior corresponding period when it booked an impairment charge relating to the loss of a Defence contract.
Operational profit before tax, which excludes one-off charges and was regarded as the best indication of financial performance, was $17.8 million, more than four times the $4.3 million result in the prior year.
Lechuga
says:Now if only they could stock it into some newer aircraft. Saabs, as great as they have been can’t last forever and they’re getting a bit long in the tooth.
Barry Walsh
says:With this profit why not lower prices from Burnie/Wynyard to Melb Ana return .After doing figures for distance :price this is way over charges that should be charged.My wife &I travel this route at least 3 times per month.
Neilsh
says:Lower ya airfares then ya dogs
David McGrath
says:I flew on one of their SAAB’s the interior was in poor condition. Scuff marks on the walls and ceiling. The carpet was worn and dirty. The toilet was equivalent to one in a public park. The fare was higher than on QantasLink which has become my preferred alternative. Spend some of the profit on your aircraft interiors please
James
says:The SAABs are all old aircraft that, for the most part, copped a hiding in the US before getting over here.
Like any business, they won’t lower their fares because they are doing well. I’m only speculating but I would imagine a great help to their bottom line has been there FIFO contracts which by their very nature must be lucrative due to the fact they aren’t necessarily “competing” with anyone.
Also, they haven’t outlaid big bucks on a fleet of ATR-42 600’s (the logical new airframe replacement) which keeps cost way down.
Finally, airfares fluctuate with all carriers. You can’t just say REX are more expensive than QF. It may be the case, if you look online for the same flights, at the same time at approximately the same time prior to departure, one may be more expensive than another consistently.
But remember, REX aircraft hold less people than the competitors therefore the cheaper seats will sell quicker, there will be less of them for sale so it will seem like they are dearer. People tell me this stuff all the time and sometimes it just needs explaining on how ticketing is done and seats sold on aircraft.
They are making money and if you get online and REX are significant more expensive, then the flights are full or filling up quick.
Hard to compete with 34 seats vs 50/76 with the competition.
For the sake of the people who work at REX, I’m happy for them because since inception in 2002 there seems to have been times they were very close to closing the doors.