Jazeera Airways agrees new measures to safeguard co against current challenges

Board suspends recommendation to distribute 2019 dividend

In this file photo, a Jazeera Airways aircraft takes off at an unspecified airport. The Board of Directors met virtually

to suspend recommendation to distribute 2019 dividend.

KUWAIT CITY, March 25: The Board of Directors of Jazeera Airways met virtually on March 19, 2020 to discuss the suspension of flights and present conditions in light of the coronavirus COVID-19 pandemic.

The airline’s Board agreed to suspend its previous recommendation to distribute dividends to shareholders for the financial year ending December 31, 2019. The suspension comes as part of measures taken by the airline to enable it to weather through current challenges and protect the business in the long-term.

Commenting on the decision taken by the Board of Directors, Chairman Marwan Boodai, said: “On behalf of everyone at Jazeera Airways, I take this opportunity to first extend our deepest gratitude to Kuwait’s Government, and in particularly the Ministry of Health, for the immediate measures taken to limit a spread of the virus in the State of Kuwait. We are honored to support their efforts in every way possible.

“As a private sector company, we are taking full responsibility to ensure our business continuity. Therefore, we have implemented decisive measures to safeguard our financial position caused by the covid-19 pandemic, including the suspension of the 2019 dividend payment and activating the drawdown of bank facilities, that were not previously tapped, to support Jazeera’s ongoing liquidity through the coming months. We have always taken prudent and pivotal actions in difficult circumstances. In such times, placing our employees and customers first is our priority by ensuring they are not affected in the long-run. We are committed to our role as a Kuwaiti national carrier and will continue to perform our part to ensure we can support the economy and uphold our national duty.”

In a statement, the International Air Transport Association (IATA), said that over 16,000 passenger flights have been cancelled in the Middle East and the number is expected to increase exponentially with the additional measures in different countries. International bookings in the Middle East are down 40% year-over-year in March and April, as of March 19, 2020. IATA’s statement revealed that Middle East airlines had lost $7.2 billion in revenue as at March 11, 2020, while ticket refunds have increased by 75% in 2020 compared to the same period in 2019 (February 1 to March 11).

In Kuwait alone, IATA added that consistent with the ‘Extensive Spread’ Scenario published on March 5, the disruptions from COVID-19 could result in 2.9 million loss in passenger volumes and US$547 million loss in base revenues.

Jazeera Airways is building a dedicated auxiliary special medical facility – Kuwait Passenger

Reception Centre (KPRC) – in coordination with the Directorate General of Civil Aviation (DGCA) and the Ministry of Health at Kuwait International Airport, to screen all inbound passengers and test them for Coronavirus before entering the arrival hall. The new facility is a remote extension of the Jazeera Terminal 5 (T5) and will be ready when the Kuwaiti Government plans the reopening of Kuwait International Airport to passenger traffic.

The airline had announced placing its fleet of 14 aircraft at the disposal of the State of Kuwait to support its efforts to return Kuwaiti citizens to the country as well as serve for transporting medical products and equipment needed. The airline has always placed its fleet at the service of Kuwait in times of crisis and continues to do so as part of its national duty.

Boodai concluded: “Jazeera Airways has faced previous challenges in its history and is confident that the underlying position of the airline is capable to successfully manage this current period. We believe the situation is temporary and the aviation market as well as Kuwait economy will stabilise and return to growth, as a result of the joint efforts between the government of the State of Kuwait and the private sector, under the patronage of His Highness the Amir of the country, may God protect him and His Highness the Crown Prince.”