Baker delays QA listing, sees profit fall this fiscal
BERLIN ANY stock market flotation of Qatar Airways has been pushed back into the distant future, Chief Executive Officer Akbar al Baker of the Gulf state’s airlines said on Thursday.
Qatar Airways indicated late in 2010 it was planning an initial public offering in early 2012 after three consecutive years of profit. Last June, Baker had said the carrier could seek a stock market listing by the end of 2011. The IPO “will be postponed for a long time because we feel it will take a long time to recover from the economic situation that the world is in,” he said on Thursday.
Baker said the IPO plan would have been to list 50 percent of the company’s shares, but limit foreign ownership of stock to 20-25 percent.
He said profit would slump at the airline in the financial year to end-March, with revenue hurt to the tune of almost $490 million from the Arab Spring uprisings and $515 million from high fuel prices.
“But we will still have our nose above the water,” he said, adding he expected revenue of $6 billion, up from $5.1 billion the previous year. Baker said in June the airline made net profit of $205 million for 2009/10 and more than $230 million in 2010/2011.
The airline industry has seen several insolvencies this year, such as Spanair in Spain and Malev in Hungary. Baker said more would follow.
“I think quite a few airlines will go belly-up in Europe and some other parts of the world,” he said, adding Gulf carriers were unlikely to fall into that category. After buying 35 percent of all-freight airline Cargolux last year, Baker said he would be keen to take more stakes in cargo companies, but was not looking at present because of a downturn in the freight market.
Expressing confidence that Airbus and Boeing would resolve a series of high-profile glitches, Baker said it was normal for new aircraft such as the Airbus A380 superjumbo and the Boeing 787 Dreamliner to have teething problems and stressed safety was not an issue.
He also seemed satisfied with Boeing’s production plans for its new 787 Dreamliner, although many analysts have described the company’s plans to boost production to 10 aircraft a month by end-2013 from 2.5 now as optimistic.
“The 787 will be a very good airplane. I am confident,” Baker said. “I cannot discuss the details, but I can tell you that they have a very achievable ramp-up strategy,” he said after being briefed on the plans for record widebody aircraft production.
Boeing is grappling with a problem of delamination or the separation of bonded layers in part of the composite structure of its lightweight Dreamliner, while Airbus is wrestling with a series of cracks on components inside the wings of its A380 superjumbo.
“I think they will solve the problems with the A380. It is not a big issue...it is an aircraft that is in its infancy,” said Baker.
Baker’s remarks at a major travel industry event in Berlin contrast with his comments during the Dubai air show in November when he questioned whether Airbus was “still learning how to build aircraft”.