board presentation 2006 group 8 dickson chan / michelle chong / belle kwok / kevin li / jonathan...
TRANSCRIPT
Board Presentation 2006
Group 8 Dickson CHAN / Michelle CHONG / Belle KWOK / Kevin LI / Jonathan WONG
Presentation Outline
Introduction
Business model (comparison with similar airlines)
Market Share Estimate
Key Performance Indicators (Profit / Loss)
Fleet Planning
Summary
IntroductionOrganisational Structure
Introduction
Our ObjectivesProvide at least one daily frequency between our destinations
To achieve average load factor of 70% in our first year
To become profitable within our first year
Mission Statement
To become the preferred airline in the premium business travel market sector in Australia and the World
• Delivering Safe, efficient and reliable air services• Innovative and personalised customer care
Product and Services
All Business Class cabin
60 passengers
Introduction
Product and Services
2-2 configuration
61 inch seat pitch
22.9” inner seat width
Introduction
Introduction
Sydney (SYD)Melbourne (MEL)
Hong Kong (HKG)
London (STN)
HKG/SYD:
8 per week
HKG/MEL:
7 per week
HKG/STN:
12 per week
Network / Frequencies
Frequencies
Business ModelDeveloping the business model…
EOS
premium business/first class service
Maxjet:
low fare business class service
Privatair
Service operated on behalf of Lufthansa, KLM and Swiss International
Business ModelWe are different from Ozjet...
- Domestic: Network and Frequency
- Fuel-inefficient 1970s aircraft
- High cost of maintenance
- Lack of travel agent support
- High break-even seat factor
- International: Comfort
- Fuel-efficient (newest generation of 737)
- New airframe, low maintenance costs
- Ticket distributions on GDS
- Better break-even seat factor
Market Share Estimate
14.3%
15.6%
15.5%
29.7%
24.2%Total Market Share
10.2%13.3%13.5%21.3%22.4%Capacity Share (30%)
16.0%16.7%16.3%33.3%25.0%Frequency Share (70%)
102,60074,70060,20032,70036,600
Forecasted NS06 Total Business Class Passenger
Traffic
Hong Kong/
LondonSydney/ London
Sydney/ Hong Kong
Melbourne/
London
Melbourne/ Hong
Kong
Routes
Yield (per route)
Unit Cost (per route)
Breakeven
Actual Seat Factor
Utilisation
Profit / Loss
Key Performance Indicators
Key Performance Indicators
14.7Aircraft Utilisation
(hours/day)
18.818.918.818.618.818.6Unit Cost
(cents/ASK)
28.833.724.731.124.731.1Yield (cents/RPK)
66.9%56.2%76.0%59.8%76.0%60.0%Breakeven Seat
Factor
-~40~35~35~25~30Allocated Capacity (one-way seats/day)
75.9%65.0%78.5%62.5%82.4%62.3%Passenger Seat
Factor
637.3112198.168.6164.865.6
Expected Revenue Passenger Km (million RPKs)
839.5172.3252.3109.7199.9105.3Available Seat Km
(million ASKs)
System-wide (NS06)
Hong Kong/
LondonSydney/ London
Sydney/ Hong Kong
Melbourne/ London
Melbourne/ Hong Kong
Key Performance IndicatorsProfit / Loss - NS06 (1)
21.114.61.60.93.20.8
Profit/Loss beforeinterest and tax(A$ million)
(157.5)(32.6)(47.3)(20.4)(37.5)(19.6)Operating Expenditure (A$ million)
178.647.24921.340.720.4Passenger FlightRevenue (A$ million)
System-wide
Hong Kong/
LondonSydney/ London
Sydney/Hong Kong
Melbourne/ London
Melbourne/
Hong Kong
Key Performance IndicatorsProfit / Loss – NS06 (2)
8.9%7.8%6.9%11.8%Gross Profit Margin
110.3%108.9%109.5%113.4%Operating Ratio
QantasCathay Pacific
British AirwaysSkyways
Fleet Planning
Boeing BBJ2 Range
With 7 auxiliary fuel tanks - 10,460km
Mission RequirementsRoute Distance (km)Sydney / Hong Kong 7372Melbourne / Hong Kong 7387London Stansted / Hong Kong 9582
Future Mission RequirementsBrisbane / Hong Kong 6930Perth / Hong Kong 6007Paris / Hong Kong 9607Frankfurt / Hong Kong 9171
Boeing BBJ2 Range Capability Chart
Mission Requirements
Fleet Planning(2008-2012) Forecast
717,500Stansted / Hong Kong
368,010Sydney / Hong Kong
322,664Melbourne / Hong Kong
ASK (000s)
2006Annual ASKs PRODUCED
953,864900,737850,71
8803,751759,780Stansted / Hong
Kong
475,218434,921399,41
2368,694368,010Sydney / Hong Kong
512,629461,726415,11
5372,728334,494Melbourne / Hong
Kong
20122011201020092008
ASK (000s)Annual ASKs required
Note: Cells highlighted in Yellow indicates that the current ASKs would not meet the ASK requirements of that year
Fleet Planning
Boeing 767-200ER
102 seats / 2-2-2 configuration (similar to Maxjet)
max range 12,223km
Capable of carrying FRT
10 tonnes on SYD-HKG
3.7 tonnes on STN-HKG
Aircraft Evaluations
Figure: Boeing 767 family Range Capability Chart
Business model proven in the Trans-Atlantic market
Applying this model on our market, avoiding Ozjet’s mistakes
Profit of $21.1 million AUD (NS06, before interest and tax)
Operating Ratio: 113.4%, Gross Profit Margin at 11.8%
Breakeven SF (66.9%); PAX SF (75.9%)
Aircraft Utilisation: 14.7 hrs per day
Fleet Planning: Acquiring additional BBJ2s for new routes 2 x 767-200ERs for London to Hong Kong
Summary