The Royal Jordanian (RJ) general assembly held its ordinary meeting yesterday, under the chairmanship of Vice Chairman of the RJ Board of Directors Aqel Biltaji, a company statement said.

Attending were members of the board of directors, RJ President/CEO Captain Suleiman Obeidat, the companies’ deputy general comptroller, RJ accounts auditors Ernst and Young and some shareholders; who own 88% of the company capital, amounting to JD146.4 million dinars/shares.

According to the statement, Biltaji highlighted the RJ position as the national carrier of Jordan that contributes about 3 percent to the kingdom’s GDP. It has been the cornerstone of Jordan’s air transport industry,which enjoys regional and international reputation due to its dependable air operations, competent and well-trained Jordanian manpower, and a modern fleet that serves an extensive network of destinations spanning four continents.

He said that the observer of RJ’s journey in the past ten years and the challenges would realize that RJ is not alone in facing hurdles; it is a situation shared by all self-reliant companies in the world.

Over the past few years, Biltaji said, several circumstances and challenges affected RJ’s resources and results, as well as its ability to attain the profitability desired by the shareholders and its management. In parallel, new challenges appeared in 2016, like the currency exchange rates that affected last year’s results, in addition to the steep competition presented by the big carriers in the region, the statement added.

He said that RJ is keen on implementing the government’s vision for RJ in the coming period, particularly after the directives the Prime Minister gave during his visit to RJ accompanied by the government’s economic team last week.

The meeting discussed a number of issues, including the need to encourage tourism in the kingdom, find new and promising markets in cooperation with the Jordan Tourism Board, the Aqaba Special Economic Zone and other stakeholders.

He pointed out that RJ will work with different ministries and government departments to find solutions to challenges and to invest in developing the RJ-owned Royal Wings and Royal Tours. This presents a great potential for RJ, in light of the tourism and investment capabilities, particularly in Aqaba, Petra and Wadi Rum, Biltaji added.

Further, he said that RJ transported 3 million passengers in 2016.

He said that RJ will review ways to benefit more from its contribution to other companies, like Dnata Catering Company, Jordan Aircraft Maintenance Company (JorAMCo), Jordan Airline Training and Simulation (JATS) and others.

Biltaji stressed that Royal Jordanian is a long-established company, while pointing that the company’s board of directors is currently reviewing five themes of great importance and direct link to Royal Jordanian, namely its people, products, plans, perception and performance.

In his speech, which was distributed to the shareholders, Chairman of the Board Said Darwazeh, said that the 2016 results did not conform with those sought by the Royal Jordanian management, its employees and shareholders.

He said that the main reason that led to incurring a net loss of JD24.6 million was the provision for currency devaluation of the Sudanese Pound and the Egyptian Pound of JD19.5 million, due to the decision taken by the Sudanese government to impose incentive fees on currency transfers outside Sudan and the decision of the Egyptian government to float the Egyptian Pound during 2016, in addition to provision of JD3.5 million in compensation of voluntary redundancy.

He added that another factor that contributed to the decrease in last year revenues and increased the loss was the drop in ticket fares by 11%.

The operating revenues declined to JD598.3 million from JD658.1 million in 2015, because of the growing competition RJ faced in 2016 both from full-service airlines and low-cost carriers.

He stressed that although RJ’s operating revenues fell by 9%, it managed to decrease its operating costs by 6%, from JD559.1 million in 2015 to JD527.7 million in 2016, which helped it attain a JD5 million net operating profit, compared to JD29.6 million in 2015. The gross profit reached JD70.6 million in 2016 compared to JD98.9 million in 2015, a decline of 29%.

Darwazeh said that despite the decline in revenues, the net operating profit recorded by the company in 2016 remains an indication of RJ’s ability to maintain its competitive position and its share in the local, regional and global markets.

It offers high-level services to passengers, boasts a modern and young fleet of aircraft, and a wide network that the company continuously works to strengthen, to boost connectivity.

The entry of seven newly manufactured 787 Dreamliners is an important factor that helps RJ offer even more competitive services. At the end of 2016 and the beginning of 2017, the sixth and seventh aircraft of this type entered on a capital lease basis that ends with ownership of these aircraft. The first five aircraft of the same model entered on an operational lease basis.