As a result of low fuel prices and an increase in demand for services during the holiday season, low-cost Tanzanian airline, Fastjet (LON:FJET), posted its first profitable trading month and carried its millionth passenger in December 2014.
The yield per passenger has reportedly increased by 20% compared to December 2013 with the total revenue for the month also reporting an increase of 106% year on year.
With fuel prices continuing to fall, the airline has explained that because they do not hedge its fuel costs, they are seeing significant benefits from the reduction in the cost of crude oil, which has already fallen 13% in January 2015 and is expected to be further reduced in February and March.
According to Fastjet’s interim chairman and chief executive, Ed Winter, the announcement of the airline’s first profitable trading month is a significant milestone for the air carrier.
“The announcement of our first profitable trading month is a great achievement and a huge milestone on the road to becoming the first pan-African low-cost airline,” he said, “We have already proven that the low-cost model works to stimulate traffic and we have now shown that it can create a profitable business.”
Fastjet first launched its services in Tanzania in November 2012 and is now in the final stages of its expansion into Zambia , where it hopes to launch services by the end of the first quarter and then continue expanding its services into Kenya, Uganda, Zimbabwe, and South Africa pending additional funding.