Had it not been hit by rising fuel prices and a drop in the value of sterling in the financial year 2008-2009, Air Malta would have broken even, chairman Lawrence Zammit tells The Times Business in an interview today.
"The fundamentals of the company are not bad," Mr Zammit insists. "From published data, we can say that the cost per available seat kilometre is similar to that of EasyJet. Where they do better is their seat load factor - they obviously have a better marketing reach, which we can never hope to match."
There is mounting speculation that Air Malta plc is around €25 million in the red in the run-up to the company's annual general meeting early next year when, it is rumoured, Mr Zammit intends to hand in his resignation. Last week, Finance Minister Tonio Fenech said the government's trust in the chairman was "unquestioned".
Describing himself as not "indispensable", Mr Zammit's tone is not that of a chairman who has loosened his grip on the reins.
"The financial year 2009-2010 is characterised by lower prices and dampened demand," he adds. "In spite of the recession, we have strived to maintain passenger numbers and, by and large, we have achieved this objective. Last summer we operated 12 aircraft on Malta. This was contrary to the trend of other airlines - no other airline increased capacity the way we did."
Air Malta envisages further pressure on pricing in 2010, but the national carrier will seek to maintain and even increase passenger numbers, Mr Zammit emphasised.
He hopes airlines will not be made to foot the bill for tighter security operations in the wake of the terrorist attempt on a Detroit-bound Northwest Airlines flight on Christmas Day.
The chairman explains Air Malta is not far off from its ideal size after shedding over 600 employees in six years, and outsourcing many operations, besides pursuing its cost-cutting drive. Restructuring, he insists, started well before any low-cost airline flew into the Maltese scenario.
Negotiations with the General Workers Union over a collective agreement have resumed after breaking down earlier in the year.
The chairman says he is "very saddened" that Air Malta's investment in new routes is not highlighted. The national carrier, he insisted, was not after preferential treatment but a level playing field on which it could be able to compete fairly and continue to serve Malta's economic nerve.
Asked whether there were plans to modify Air Malta's business model in any way, Mr Zammit says that unless the airline's role changed, the business model would likely remain the same.
The airline will continue to maintain a commercial focus and high levels of efficiency while it fulfils its mission to support Malta's tourism and manufacturing sectors and meet its social responsibilities, he emphasises.