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EgyptAir Expects Stability to Boost Its Growth Prospects

With the election in Egypt last week of former army chief Abdel Fattah Al Sisi as the new president, a nation and a region awaits a potential period of stability in the troubled Arab state. And one company that is desperate for calm is the flag carrier EgyptAir.

EgyptAir website

“We expect some indication of recovery, especially after the presidential election,” said Sameh El Hefny, the chairman and chief executive of the government-owned airline.

The airline is in a period of restructuring. It is cutting capacity by 10% on its network by reducing frequencies on flights and quitting a few routes. Mr. Hefny expects to report a loss of 2.5 billion Egyptian pounds in the full year ending June.

EgyptAir hopes the changes will grow passenger numbers and increase its load factor. The airline carried 9 million people last year, with Saudi Arabia its largest market. Its aircraft were 62% full, which Mr. Hefny believes can grow to 70% once capacity is reduced and if the economy improves.

The airline had planned to run a fleet of 127 jets by 2025. But given the current economic pressures, Mr. Hefny leased 2 Boeing Co. 777-200 aircraft to Biman Airlines and 5 narrow-body aircraft to local companies.

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(via WSJ Blogs)