Israir CEO Optimistic on Stock Despite Losses, Cites Growth
Translated & summarized from Globes by baba
Israir CEO Uri Sirkis is optimistic about the airline's stock, forecasting profitability by 2026 despite a $35 million loss in the first half of the year. He cites increased passenger numbers, rising ticket prices, and strategic investments in a Cyprus maintenance center as key growth drivers. Sirkis believes Israir's stock has significant potential for growth, contrasting it with competitor El Al. The company is also expecting state compensation and revenue from its club membership program.
The story in 5 lines · by baba
- Israir CEO Uri Sirkis predicts the airline will be profitable by 2026 and possibly this year.
- Israir transported 927,000 passengers in the summer, a 15% increase year-over-year.
- The airline lost $35 million in the first half of the year, largely due to conflict-related airspace closures.
- Sirkis highlighted a $10 million investment in expanding Israir's maintenance center in Larnaca, Cyprus.
- Israir's stock has risen 50% since its 2022 IPO, while El Al's stock has surged over 400% since the start of the "Swords of Iron" war.
Israir CEO Uri Sirkis expressed strong optimism about the airline's stock performance, projecting profitability by the end of 2026 and potentially this year, despite recent financial setbacks. He believes the company's stock has greater potential to double compared to competitor El Al. Sirkis attributed Israir's significant loss of $26 million in the first half of the year primarily to "Operation Harry's Roar" and the closure of Israeli airspace, compounded by a 60% increase in fuel prices. The company also implemented a 5% workforce reduction to improve efficiency.
The company reported a gross profit of $4 million in the first half, which would have been $40.8 million without "extreme events."
Further bolstering his outlook, Sirkis anticipates a $10 million profit unrelated to flight operations, stemming from state compensation for the Iran conflict and the airline's club membership program. He also highlighted the positive impact of upcoming flights to the United States. Israir is investing $10 million in expanding its maintenance center in Larnaca, Cyprus, which Sirkis values at $40 million, an asset he believes is not yet reflected in the stock price. The Larnaca facility has doubled its maintenance lines since Israir acquired it 2.5 years ago.
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