Croatia Airlines dd : continues to show a positive upward trend

Zagreb, 29 July, 2016

During the first half of 2016, the Croatian national air carrier, Croatia Airlines, continued to show a positive upward trend.

The first half of 2016 was marked by a two-percent growth in the number of passengers compared to the same period last year. Total sales showed a positive trend with an increase of one percent. Positive growth was achieved in domestic market sales, which saw an increase of five percent compared to the first six months of 2015, which clearly indicates a recovery of the domestic market.

Operating income was at the same level as last year for the same period. With a two-percent decrease in operating costs, the operating loss was successfully reduced. Stabilization of business operations, a key segment of the effective completion of the restructuring program, was reflected precisely in the reduction of operating loss compared to the same period last year, amounting to HRK 83.6 million. Also, the net result increased by 13 percent, i.e., the company recorded smaller net loss compared to the same period last year, amounting to HRK 84.6 million.

The majority of operating expenses decreased compared to the first half of 2015. The most significant growth was recorded in the cost of aircraft maintenance due to higher costs of consumables and services provided to other companies, as a result of an increase in the volume of works, which at the same time contributed to an increase in revenues by 2.5 times from the provision of aircraft maintenance services to other airlines.

In the first half of 2016, Croatia Airlines carried out 12,388 flights, which was an increase of one percent, and transported 822,260 passengers, an increase of two percent compared to the same period in 2015.

Croatia Airlines has a 41 percent share in passenger traffic of domestic airports. It should be noted that the Croatian aviation market is characterized by the seasonality of traffic, with a high level of competition in the summer, while Croatia Airlines operates all year round, thus enabling year-round operation of Croatian airports. Because of the seasonality of traffic, the Croatian national carrier, in accordance with its business plan, regularly records losses in the first six months, but for three consecutive years, it has recorded positive overall year-end financial results.

From March 27 to 29 October, 2016, Croatia Airlines flights are in accordance with the summer timetable and they are adjusted to the needs of passengers, especially during the tourist season, and the capacity of the fleet. During this period, in regular international traffic, Croatia Airlines directly connects Croatia to 34 destinations in 20 European countries, and in cooperation with its Star Alliance partners, with the entire world. Croatia Airlines started 2016 with 14 code share partners, including three members of Sky Team Alliance - Air France, Alitalia and KLM. In the course of 2016, Croatia Airlines has expanded its existing code share agreement to include Turkish Airlines.

Also, the company's obligation to operate with a reduced market capacity expired upon successful completion of the restructuring program. Starting on April 30, 2016, Croatia Airlines has increased its capacity by leasing an additional aircraft for the period between May - October 2016. This has enabled the expansion of its network of destinations to include the European cities of Prague, Milan, Lisbon and St. Petersburg. As a result, this year Croatia Airlines recorded its one millionth passenger earlier than ever before in the company's history. The aforementioned activities will enable further development of Croatia Airlines and even better positioning of the Croatian national airline in the European and world markets.