Air Malta expects to sharply reduce its losses this year as it enacts its turnaround plan.

In an interview published on Air Transport World, airline chief executive Peter Davies said that Air Malta's operating loss for the year ended March will be around €15 million, compared to €55 million projected operating loss in the adjusted budget of two years ago.

"This is in-line with the milestones in the EU approved Restructuring Plan,” he said.

Leading aviation magazine Air Transport World caught up with Mr Davies who was the guest speaker at the European Regional Airline Association annual conference in Edinburgh this week.

This conference, attended by around 200 delegates from various European airlines, is known for its focused and topical conference sessions and this year it centred on the core issues affecting aviation in Europe.

During the conference’s first session entitled, ‘Facing today's challenges to achieve a more stable future’, Mr Davies addressed the issue of how the European regional aviation industry is facing up to today’s challenges that include the Eurozone crisis, unpredictable fuel costs, consumer behaviour and EU aviation policy decisions.