The Fiji Airways Group achieved its biggest pre-tax profit ever during the fiscal year that ended December 31, 2016, a total of F$84.5 million. The Group (legally known as Air Pacific Limited) comprises Fiji Airways, Fiji's national airline; its subsidiaries Fiji Link & Pacific Call Comm. Ltd; and a 38.75% stake in the Sofitel Fiji Resort & Spaon Denarau Island. Most notably, profit before tax increased by 20.5% over the prior financial year.
Mr. Andre Viljoen, Fiji Airways Managing Director & CEO, said: "This is a fantastic result, as we record another year of growth in reported profit. This strong performance is a true testament to the tremendous work done by our team, responding strongly to the challenges we faced. I am most thankful to our Chairman, Mr. Rajesh Punja, and the Board for their guidance and support, and to every Fiji Airways Group team member for their dedication and efforts.
"Last year was full of milestones achieved, culminating in the largest profit the airline has ever recorded. To achieve these results is nothing short of outstanding - in a year when we had the most devastating cyclone in our nation's history slow down tourism and the launch of three new international routes.
"The result would also not have been possible without the backing of the Fijian Government and the Fijian people, who continue to stand by us. I especially thank our Prime Minister, the Hon. Voreqe Bainimarama, and our Line Minister, the Hon. Aiyaz Sayed-Khaiyum, for their vision and unwavering commitment to the national airline."
"We are proud of these excellent financial results, but we take particular pride in the fact that the increased profit is a sign of excellent leadership, a healthy and positive airline culture, and a constant improvement in service at all levels," said the Attorney-General. "These factors will take us well into the future as we build Fiji Airways into a top, full service carrier."
"The financial results and other accomplishments also show what government and state-owned entities can do together when government has a strong and focused vision and establishes a proper operating environment, and then lets management do what it is supposed to do as a commercial entity. Fiji Airways is showing that with a management focused on merit-based recruitment, high standards of service delivery, airline safety, and a partnership approach to workplace relations, any state-owned entity can achieve its true potential and beyond. Fiji Airways is the only state-owned enterprise which shares its profits with all its employees," said the Attorney General.
The airline reports that yields were under pressure throughout the year from the increased capacity of its competitors, discounting of airfares by competitors that had taken advantage of lower fuel prices, and the disruptive effects of February's Tropical Cyclone Winston. Fiji Airways led actions after the cyclone to re-invigorate travel demand by significantly discounting its airfares, which cost the Company in excess of $40m in lost revenue. However, these actions by Fiji Airways are largely responsible for Fiji's tourism growth of 5% experienced in 2016.
Based on the PwC audited financial statements for 2016, the Group has announced the following profit-share and management-bonus arrangements:
The airline's restructured Leadership Team, which now comprises three Fijian Executive General Managers, contributed to the airline's numerous 2016 achievements. These include:
Mr. Viljoen further stated: "2017 will be another busy year as we've set bigger, even more ambitious goals for ourselves. This year we are targeting many further service improvements to attain the highly prized 4-Star Skytrax rating during 2018. We are increasing our focus on Singapore with a dedicated new Sales team in place and a codeshare partnership with Jet Airways to target more Indian travellers."
"We will fly directly between Nadi and Adelaide from June, further extending Fiji's reach into its biggest tourism source market. San Francisco will be extended to a year-round service, providing increased tourism growth opportunities from mainland USA. We are constantly looking to add value to Fijian tourism and the Fijian economy. We are further reinforcing our pilot progression plan, and future pilot recruitment for Fiji Airways will be through Fiji Link."
Mr. Rajesh Punja, Fiji Airways' Chairman, said: "The Board welcomes another strong financial performance. The result speaks for itself, and we must acknowledge the leadership of Andre in delivering this. In just fifteen months at the helm, Andre and his Leadership Team have taken Fiji Airways to another level in terms of network growth, product improvements and service enhancements, while introducing numerous efficiencies and increased fiscal discipline. I would also like to thank my Directors for their invaluable contribution to the Company."