Air Malta chairman Ray Fenech has not ruled out that the airline may be privatised in the future but said there were no plans to do so at this time.

He was speaking yesterday after the airline presented financial results showing it halved operational losses in the year ending March and turned a profit up to September.

Mr Fenech said that in talks between the board and the Government, which is the sole shareholder, privatisation was never mentioned.

“For the time being there is definitely no such plan,” he said.

But Mr Fenech could not rule out that some form of privatisation might have to be considered in the future, especially if Air Malta wanted to grow after it cuts loose “the chains” imposed by the EU restructuring agreement.

“However, at the end of the day any proposal this or any future board makes on privatisation will depend on what the Government decides,” he said.

Earlier this month, Tourism Minister Karmenu Vella did not give a direct reply when asked a direct question in Parliament on whether the Government intended to privatise or part-privatise the airline.

He said the Government would await the results of the restructuring exercise and strategic decisions would be taken when the real state of the company became known.

The airline, Mr Fenech said yesterday, was on track with its restructuring obligations.

It registered an operating loss of €13.7 million for the financial year that ended in March, a substantial improvement over the loss of €29.7 million registered last year. The result was €1 million better than that budgeted in the restructuring plan. However, total losses reached €31.2 million when one-off restructuring costs were included – still an improvement over the €38.2 million lost last year.

The results look more encouraging for the current year with the airline registering an operational profit of more than €6 million between March and September.

A profit of €2.9 million was retained after one-off restructuring costs were taken into account, which represents a turnaround from the €5.6 million loss for the same period last year.

Chief executive Peter Davies said the results were encouraging but suppressed the elation. “The company is not rejoicing because more has to be done and this requires focus and bravery.”

Mr Davies said stamina was needed and he expected the second six months of the current year to be tough as Air Malta braced itself for the winter months.

Air Malta was saved from financial ruin after the Government pumped in emergency aid in 2010. This was only possible after Brussels gave the go-ahead on condition the airline stuck to a strict restructuring plan.

The plan allowed the Government to pump in more money but Air Malta had to shed almost half its workforce, reduce routes and cut down the number of planes. It is expected to return to profitability by 2015.

CEO Davies’s contract talks

Air Malta chairman Ray Fenech has confirmed that talks on the renewal of airline CEO Peter Davis’s contract will start next week.

The CEO’s three-year term ends next March amid speculation that the Government will not seek a renewal of the contract that came with a pay packet of half-a-million euros.

But Mr Fenech yesterday said that extending the contract depended on various factors, including what Mr Davies wanted to do.

Asked whether the board was happy with Mr Davies’s performance, he replied: “Until now the results are what they are.” Currently in its third year of a five-year restructuring plan, the airline has managed to stick to the EU-imposed targets.

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