ECONOMY

THY aiming higher still

ISTANBUL (Reuters) – Turkish Airlines (THY) is targeting 20 percent passenger growth in 2008 and expects to have ended 2007 with a net profit margin of 10 percent, General Manager Temel Kotil told Reuters. Between January and November of 2007 the total number of passengers rose 16.3 percent to 18 million year-on-year, a figure which was expected to have reached 20 million by year end, Kotil said in an interview late on Wednesday. In 2008 he expects the airline to carry 24 million passengers. Kotil said that in 2007 growth in international flights had overtaken domestic growth, reversing an earlier trend. In the first nine months, revenue from international flights made up 76 percent of ticket revenue. «In 2007 international growth overtook domestic growth. We grew 18 percent outside the country; domestically we grew 15 percent,» he said. THY, set to join the Star Alliance airline grouping in March, is one of the fastest-growing airlines in Europe. Its shares rose 41 percent last year, in line with the wider Turkish market, although they suffered from uncertainty in July and August over a planned strike, which was eventually averted. «THY is aiming to end 2007 with a profit margin of 10 percent. Even if we can’t continue this in 2008, even if we do half of that, that would still be a high margin compared to the sector standard,» Kotil said. In 2007 THY increased its passenger load factor by four percentage points – a ratio of how many seats are filled on flights – and aimed to add another two points in 2008. Kotil said high oil prices would add some 5 to 8 percent to all airlines’ costs this year, but gave no estimate for his own firm. The International Air Transport Association (IATA) said in a report in December that the price of fuel and the result of a credit crunch will cut 2008 sector profits to $5 billion from an earlier forecast of $7.8 billion.