Israel’s El Al shows a second-quarter net profit of USD 147 million

El Al Israel Airlines (ELAL.TA) reported a practically 150% leap in profit, taking benefit of its near-monopoly standing with many overseas carriers having cancelled flights amid the struggle in Gaza and elevating shoppers’ ire over excessive fares.

Separately, El Al introduced a cope with Boeing (BA.N), for the acquisition of as much as 31 737 MAX plane value as a lot as $2.5 billion to switch its getting old short-haul fleet of Boeing 737-800 and 737-900 planes.

Israel’s flag provider posted a second-quarter net profit of $147 million, up from $59 million a 12 months earlier, earlier than the struggle with Hamas militants in Gaza that started on Oct. 7. With competitors sturdy, it had typically struggled to remain worthwhile pre-war.

Revenue jumped 33% to $839 million, whereas its passenger load issue rose to 92% from 87%, even because it expanded capability by 8%.

Its Tel Aviv-listed shares, nonetheless, fell 2% regardless of the outcomes.

El Al has been criticized by prospects in Israel and overseas for price-gouging, because it has emerged as a near-monopoly for the reason that Gaza struggle triggered by the Hamas assaults in Israel. El Al has benefited as rivals have steadily cancelled providers because of the safety scenario.

El Al rejected the criticism and accusations it was taking benefit of a passenger base with little journey choice, saying that half of those that had purchased tickets this 12 months have been paying lower than in 2023.

“We put some constraints on our price list,” El Al Chief Executive Dina Ben-Tal Ganancia informed Reuters.

ADDITIONAL FLIGHTS

Ben-Tal Ganancia mentioned many passengers have been reserving late given the safety uncertainty and demand was higher than provide. The provider can also be offering flights for a price to these stranded, from Greece, Cyprus and different areas and has added flights to the United States and Asia.

“So if you bought a ticket with United and now you are coming to El Al (after a cancellation) … you won’t find the same price that you bought six months before,” she mentioned.

After resuming flights in June, many air carriers have as soon as once more cancelled flights to and from Tel Aviv, some of them till 2025, amid threats of a potential assault on Israel by Iran and its proxy Hezbollah in Lebanon.

“The last few days prove to us in particular how fragile the concept of ‘open skies’ is in relation to Israel,” mentioned Ben-Tal Ganancia.

Source: Reuters