El Al Israel Airlines swung to a net profit in the fourth quarter of 2015, driven by a sharp drop in fuel costs.
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Israel’s flag carrier said it earned $12.2 million in the quarter, compared to a $14.8-million loss a year earlier. Revenue dipped 3.4% to $476.3 million. Expenses declined 14.1%, as the cost of jet fuel in 2015 dropped 32%. The company said it would pay a dividend of $15 million, after paying $25 million a few months ago.
El Al said it flew more than five million passengers last year, up 8% from 2014. Its load factor was steady at 82% to 83%. In October, El Al signed a deal to buy and lease 15 Boeing 787-8 and 787-9 Dreamliner passenger planes, in a deal worth more than $2.2 billion. It was El Al’s largest-ever aircraft deal. El Al expects the new planes to reduce operating costs by 20%.
During the fourth quarter and into 2016, El Al was hit by intermittent labor action by some its pilots. The airline has since signed a new wage agreement with all its workers after the previous one expired three years ago.
Despite the swing to profitability, the company’s shares closed down 1.7% Wednesday, to 2.93 shekels ($0.76).
With additional reporting by TheMarker.