South African Airways has posted a positive full-year profit for the financial year 2022/23. It is the first time that SAA has seen a positive bottom line since 2012, which was achieved with only 6-8 aircraft.
The carrier reported a net profit of R252 million for the period. This places it on solid ground for its current trajectory of growth and expansion of airline operations.
Recovery in FY 2022/23
South African Airways (SAA), Africa’s oldest airline with a legacy spanning over 80 years, has demonstrated a remarkable recovery in its 2022/23 financial results.
The figures were disclosed at the recent Annual General Meeting held at Airways Park in the OR Tambo International Airport Precinct. The airline’s Interim Board presented encouraging figures to Transport Minister Barbara Creecy.
The national carrier achieved a significant milestone, posting a net profit of R252 million, marking a decisive turn from its previous financial struggles.
Revenue soared by 183%, reaching R5.7 billion from the previous year’s R2.0 billion, showcasing the airline’s successful resurrection following a challenging period of business rescue.
This financial period represents SAA’s first complete year of commercial operations since emerging from business rescue and resuming flights in September 2021.
In a notable transformation, the airline converted a negative EBITDA of R1.0 billion into a positive R277 million, demonstrating effective financial management and operational efficiency.
The achievement becomes particularly significant against the backdrop of global aviation challenges. The International Air Transport Association’s Annual Report 2023 highlighted industry-wide obstacles. This included post-Covid recovery hurdles, elevated interest rates, geopolitical tensions in Ukraine, and record-high fuel costs that affected airlines worldwide.
A Recovery After Numerous Challenges
SAA’s history as South Africa’s flag carrier dates back to 1934, and has faced numerous challenges throughout its existence. This recently included a period of business rescue from 2019 to 2021. Having moved through this, the airline has shown remarkable resilience.
During the 2022/23 financial year, SAA operated efficiently with a modest fleet of 6 to 8 aircraft serving 9 destinations, focusing on building a sustainable operation before expanding.
Growth Strategy and Expansion
The airline’s prudent growth strategy has since yielded positive results. SAA has doubled its fleet size and secured seven additional aircraft scheduled for delivery in 2025/26. A significant milestone was achieved in October 2023 with the launch of flights to Sao Paulo, Brazil, marking the airline’s return to intercontinental routes.
Network expansion has been equally impressive, with routes increasing to 16, including the strategic addition of Perth, Western Australia.
The airline has boosted frequencies to key African destinations including Harare, Lusaka, Lagos, Accra, Mauritius, and Kinshasa. It also launched services to Lubumbashi, its second destination in the Democratic Republic of Congo.
Employment growth has been a crucial aspect of SAA’s recovery. The airline group, including subsidiaries Air Chefs and SAA Technical, has significantly expanded its workforce from 800 to approximately 2000 employees, including 140 pilots, contributing to South Africa’s job market recovery.
Looking Ahead
SAA Interim CEO Professor John Lamola emphasized the significance of these results. “The 2022/23 performance reflects our commitment to rebuilding SAA as a trusted airline and respected global brand. We’ve established a path toward financial independence without government support.”
Looking ahead, Lamola outlined the airline’s strategic direction: “We’re now focusing on consolidating our current routes and fleet strategy.”
“The next phase involves substantial growth through fleet modernization, expanding intercontinental routes, and advancing our environmental sustainability initiatives. It will ensure SAA remains competitive in the modern aviation landscape.”
This positive trajectory suggests a promising future for South African Airways as it continues to rebuild its position as a leading African carrier while contributing to the continent’s economic growth and connectivity.
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