Manama, Gulf Air, the restructuring strategy last December, initiated jointly by the airline’s board of directors led by chairman Sheikh Khalid bin Abdulla Al Khalifa, the Deputy Prime Minister and the airline’s management, marked a restructuring progress within a month of its on-going implementation according to a statement by the Manama based airline.

The restructuring measures have started yielding results and the strategy remains on track to achieve overall cost savings of 24% by the end of 2013. 

In January 2013, through the implementation of cost saving measures the airline reduced its overall losses by over 34% compared to Jan 12, posted 9.6% increase in passenger revenue against its budgeted revenue and, increased its yields by over 8%.

The airline also cut its expenditure through reductions in aircraft lease fees, flight related charges, staff expenses and the closure of four loss-making routes.

Based on the current progress and the estimated forecasts, the restructuring plan targeted to achieve cost savings  by the end of 2013. Indications are also strong that the Revenue per Available Seat Kilometre (RSK) will achieve the targeted 9% increase in 2013.

As planned in January 2103 with the closure of four loss making destinations was implemented.  Negotiations were concluded in January to return two leased regional Embraer E90 jets. Further negotiations are on-going to complete the fleet realignment by April 2013. The airline now operates an all Airbus fleet. 

The finalized fleet of 26 aircraft with a mix of wide and narrow body aircraft will be optimally utilised to serve the airline’s new network. Gulf Air will operate a fleet with an average age of just 4.3 years.

The other measures include non-renewal of contracts, restructuring in outstations, natural attrition and a voluntary retirement scheme. These measures excludes Bahrain nationals and no Bahraini pilots will be affected by the restructuring.

In January a total workforce reduction of 6% was realized. This to date this has increased to 15%. In January the airline’s Bahrainisation levels at Head Quarters reached a record high of 85%.

The airline’s frequent flyer program has marked  a 9% growth in its membership in January 2013 vs January 2012.