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7JetSet7 Code: CYP
Status: Operational
Region: EUROPE
Country: CYPRUS
Employees 550
Telephone: +357 (22) 365700
Fax: +357 (22) 663167

Click below for data links:


PO BOX 21903













1996 = -$12.5 MILLION (NET LOSS).



JULY 1997: 1996 = -$10.4 MILLION.




JULY 1998: 1997 = -$6.4 MILLION (-$4.35 MILLION).




JANUARY 1999: 3 ORDERS (SEPTEMBER 1999) A319-100'S.

APRIL 1999: 1,850 EMPLOYEES (INCLUDING 106 FC, 254 CA, & 241 MT).





JULY 2000: 1999 = 2.69 BILLION (RPK) TRAFFIC (-.9%); 40.69 MILLION (FTK) FREIGHT (+6.6%); 1.4 MILLION PASSENGERS (PAX) (-1%); 1,852 EMPLOYEES (+.1%).



SEPTEMBER 2000: 1 A320-231 (V2500) (249) EX-SOUTH AFRICAN AIRWAYS (SAA), (GATX) LEASED 2001-01.


2 ORDERS (2001-01) A320'S (V2500-A1) (414; 430), EX-TRANSAER (TSD), (ILF) 3 YEAR LEASED.



FEBRUARY 2001: 4 ORDERS (2003-02) 737-800'S; 2 ORDERS (2002-02) A319'S; AND 2 ORDERS (2002-02) A330-200'S. 4 737-800'S TO BE WET-LEASED TO SUBSIDIARY EUROCYPRIA (ECY). 2 A320-231'S (414, 5B-DBJ; 430, 5B-DBK), (ILF) LEASED, WET-LEASED TO (ECY).



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1ST A319 (V2500) DELIVERY.


July 2002: 2001 = +$4.7 MILLION (+$7.9 MILLION): 3.02 BILLION (RPK) (+1%); 70.1% LF LOAD FACTOR; 1.51 MILLION PASSENGERS (PAX) (+2%); 39.98 MILLION (FTK) FREIGHT (-5.1%); 2,051 EMPLOYEES (+0.3%).

A319-132 (1768, 5B-DBP) delivery.

October 2002: 3 orders (2003-05) A320-232's (425; 1992; 2016) (CIT) (TCI) leased for start-up of new low-fare subsidiary, called "Hellas Jet" (HEJ) in 2003-05, for operations from Athens to Paris, London and Brussels.

December 2002: 1st A330-223 (505, 5B-DBS), (ILF) leased delivery.

February 2003: Cyprus Airways (CYP) is to sell 49% of its charter subsidiary, Eurocypria (ECY) to 2 northern European tour operators to counter competition from pan-European tour groups. Is in advanced talks with 2 independent tour operators, 1 in the UK, the other in "continental Europe," to take a stake in the loss-making charter arm. The competition consists of tour group affiliations such as MyTravel (GUE), Thomas Cook, and (TUI).

The investment will also free operating capital for (CYP)'s new venture in Greece, Hellas Jet (HEJ), which is to use 3 leased A320's to launch service in 2003-05 from Athens to Brussels, London, Paris, and either Frankfurt Main or Munich in a bid to offer Greek business travelers an alternative to Olympic Airways (OLY).

March 2003: Sabena Technics (SAB) contract with Cyprus Airways (CYP) for "C" maintenance checks and phase-out of 4 A310's.

A320-231 (430), returned to (ILF) leased to Mexicana (CMA).

April 2003: 1,859 employees (including 135 Flight Crew (FC), 251 Cabin Attendants (CA), & 247 Maintenance Technicians (MT)).

Parent organization/shareholders: European shareholders (51%).

Owns: Eurocypria (ECY) (100%); & Hellas Jet (HEJ) (49%).


A330-223 (526, 5B-DBT), (ILF) leased.

May 2003: 1st 3 A320-232's (425, SX-BVA; 1992, B; 2016, C), (CIT) (TCI) leased, wet-leased to Hellas Jet. Operates to Brussels, Frankfurt, London and Paris.

July 2003: 2,040 employees.

September 2003: Hellas Jet (HEJ) code share with SN Brussels, Athens to Brussels.

Cyprus Airways (CYP) serves 30 destinations throughout Europe and the Middle East.

October 2003: Next month, Larnaca to Dubai to Colombo (A320, 2x-weekly). In 2004-06, Hellas Jet (HEJ) Athens to Zurich (daily).

December 2003: Code share with SN Brussels (DAT), Brussels to Paphos
(2x-weekly) & Brussels to Larnaca (3x-weekly) (A319/A320, 2 Class).

2 A310-203's (309, 5B-DAR; 352, 5B-DAS) sold to (ILF), leased to World Focus Airlines (WFS).

January 2004: 2003 Pre-tax = -CYP 20.9 Million/-$44.5 Million (+$19 Million), including operations of Hellas Jet (HEJ).

May 2004: Next month, code share with Olympic Airlines (OLY) Cyprus to Greece.

Raises stake in Hellas Jet (HEJ) to 75%.

Intends to reduce staff and costs by sub-contracting and rearranging its network. Terminates 43 contract staff and closes its catering unit at Paphos, while reducing cargo and baggage handling employees at Larnaca.

June 2004: Memo of Understandingt (MOU) for sale of its Cyprus tour operation subsidiary to Planet Holidays (UK).

July 2004: 2003 = -$49.37 Million (-$2.04 Million): 3.35 Billion (RPK) traffic (+1.4%); 70.8% LF load factor; 1.76 Million passengers (PAX) (+2.3%); 43.06 Million (FTK) freight (+6.6%).

October 2004: Dismissed -12 senior managers & executives, as part of a -300 to -400 job reduction.

April 2005: 1,831 employees (including 138 Flight Crew (FC), 256 Cabin Attendants (CA), & 244 Maintenance Technicians (MT)).

May 2005: Its subsidiary Hellas Jet (HEJ) ceases operations. It has recently been losing -EUR 1.5 Million/-$2 Million/month. It had been operating Athens Eleftherios Venizelos Airport to Brussels, Manchester, London Heathrow & Paris.

European Commission (EC) OK's rescue aid to Cyprus Airways (CYP) in the form of a 6-month 30 Million Pounds/$56.7 Million loan guarantee at market rates. The (EC) said it complied with the community rules on state aid and would allow (CYP) to organize the restructuring of the airline.

2004 pre-tax = -CYP 36.9 Million/-$81.4 Million.

July 2005: Cyprus Airways (CYP) has signed an agreement with Air Miles of Greece for the commercial exploitation of Hellas Jet (HEJ). The Memo of Understanding (MOU) includes a call option on Air Miles to acquire 51% of (HEJ) shares from (CYP), and for (CYP) to sell to Air Miles its remaining 49%. Air Miles is the commercial name of Trans World Aviation S A, Greece.

September 2005: Cyprus Airways (CYP) intends to present a restructuring plan to the European Commission (EC) by next month. The government-controlled carrier, which was affected by the costs associated with the shutdown of its financially troubled Greek subsidiary Hellas Jet (HEJ) in May posted a net loss of CYP20.4 million/$44.7 million for the 1st half of 2005. The (EC) approved an emergency loan of $64 million in May but further aid is subject to completion of an (EU)-approved plan to return (CYP) to commercial viability. Options being looked at include the practicality of running two separate airlines within the group, possible redundancies and outsourcing. The group maintains Cyprus Airways (CYP) for scheduled flights and Eurocypria (ECY) for charter services. It operates 2 A319s, 7 A320s and 2 A330-200s. The government owns 69.6% of the company with private investors holding the rest.

November 2005: Cyprus Airways (CYP) will qualify for a CYP58 million/$121.5 million bank loan if the European Commission (EC) approves a revised rescue plan submitted by the Cypriot government. The government, which will guarantee the loan okayed additional cutbacks in order to facilitate approval, the Associated Press reported. Unions scuttled the government's previous plan.

December 2005: Cyprus Airways (CYP)'s cost-cutting talks between management and staff have hit a deadlock, with the future of the national carrier hanging in the balance. According to "Reuters," talks broke down when unions refused to endorse a restructuring plan that would see -20% of the airline's 1,831 staff members laid off and pay cuts imposed on those who remain. The Cypriot government, which owns 70% of the carrier, said deep cuts are needed urgently to salvage (CYP), which faces losses of up to -CYP28 million/-$57.2 million this year.

(CYP) employees have been granted 48 hours by (CYP) to accept a restructuring designed to produce an immediate CYP21.8 million/$45.3 million in annual savings. The plan would require about -500 of (CYP)'s 1,831 employees to accept voluntary layoffs, Reuters reported. Talks between (CYP) and its unions dissolved last month when workers refused to endorse a plan calling for approximately -360 layoffs and pay cuts for remaining workers. (CYP) is seeking a CYP58 million government-guaranteed loan.

January 2006: Cyprus Airways (CYP) is closing in on full union approval for its restructuring plan, with four out of five unions having already given their go-ahead for a scheme aimed at trimming -C£21 million/$44.3 million from its cost base. It awaits the pilots' (FC) support. It expects the cuts to be finalized in the next few weeks and for everything to be in place by around March 1. It also will begin to implement new working practices among the remaining staff in the hope that the measures will gain European Commission (EC) approval for a state-guaranteed loan. As part of the effort to secure approval, the government has agreed to acquire the airline's charter subsidiary Eurocypria (ECY). The sale is expected to generate around C£14 - C£15 million.

February 2006: Cyprus Airways (CYP) narrowed its annual loss by -41.1% in 2005 to -CYP23.2 million/-$47.7 million from a -CYP39.4 million deficit in 2004 as cost reductions outpaced a slight drop in revenues. Turnover dipped -1.9% to CYP201.2 million as it shed one airplane from its fleet. Expenses fell -4.7% to CYP229.3 million despite a +CYP9.7 million rise in fuel costs. The company also earned +CYP4.1 million on equipment sales, leaving it with a 2005 operating loss of -CYP24.2 million, down -44.1% from a -CYP43.3 million loss in 2004.

The airline has submitted its restructuring plan to the Cypriot government and the European Commission (EC) for approval. In the interim, it said it has raised a short-term, government-guaranteed loan that, along with the pending sale of its Eurocypria (ECY) subsidiary to the government, will help it "maintain its liquidity at satisfactory levels." A long-term loan and share capital increase will finance the company once its restructuring is approved, it added.

July 2006: Cyprus Airways (CYP) finalized the sale of charter subsidiary Eurocypria (ECY) to the government, according to press reports. The deal, worth CYP13.5 million/$29.9 million, is part of the carrier's restructuring. The government said that the acquisition and spinoff of Eurocypria (ECY) were designed to create a second, debt-free scheduled carrier. Eurocypria (ECY) took delivery of its fifth 737-800 last month.

October 2006: Employees = 1,698 (including 138 Flight Crew (FC), 256 Cabin Attendants (CA) & 244 Maintenance Technicians (MT)).

In 1st 9 months, Cyprus Airways (CYP) had 874.7 million (RPK)s passenger traffic (+2.4%), 16.9 million (FTK)s (+5.4%), and had 446,000 passengers (+3.6%).

January 2007: Cyprus Airways (CYP) said it has completed its restructuring process and is expecting to turn a profit this year. It lost -CYP23.2 million/-$53.1 million in 2005, and has not announced its 2006 results. The carrier cut -500 employees from a staff of 1,800 and implemented salary cuts of up to -25%, but in line with an increase in productivity. It also announced the addition of Sofia, Heraklion and Rhodes to its network. It is 67% state-owned and operates two A319s, six A320s and two A330-200s to 29 destinations, transporting about 1.6 million passengers per year. It will celebrate its 60th anniversary in 2007.

March 2007: Cyprus Airways (CYP)'s 2006 full-year loss narrowed to -CYP7.2 million/-$16.5 million from -CYP22.6 million in 2005, as it began to benefit from its restructuring initiatives. It said in January, that it expects to be profitable this year. It said improved yield and an increase in (RPK)s passenger traffic fueled a +10.7% rise in revenue to CYP157 million. Operating costs fell -0.8% to CYP159.8 million, which the airline credited to the layoffs that were part of its restructuring program. It did pay CYP10.5 million as compensation to those employees, a figure not included in its operating expenses. Operating loss narrowed to -CYP13.3 million from -CYP18.2 million.

The European Commission (EC) announced its authorization of the restructuring plan proposed by the Cypriot government, which includes a loan of CYP55 million (CYP45 million of which was backed by the government), the sale of charter arm Eurocypria (ECY) to the government for CYP13.4 million, a capital increase of +CYP14 million and other elements. Looking forward, (CYP) said it will continue to cut costs in 2007 "while at the same time improving its product and customer appeal."

August 2007: Cyprus Airways (CYP) reported a -€11.7 million/-$16 million) loss in the first six months of 2007, narrowed from a deficit of -€40 million in the year-ago period, that included the results of charter subsidiary Eurocypria Airlines (ECY), which was sold to the Cypriot government last year. Revenue fell -15% year-over-year to €126.5 million, but rose +12.3% if Eurocypria (ECY)'s contribution is excluded from the comparison figure. Expenses declined -21.6% to €135.9 million. Operating loss improved to -€9.8 million from -€42 million. Traffic data were not provided.

The airline said its second-half outlook is "markedly improved in comparison to . . . the first half." It received European Commission (EC) approval in May for a €78 million government loan, and expects an approximately +€24 million increase in share capital, through a rights issue to existing shareholders before year end. It expects to realize "substantial savings" through the establishment of a joint venture company that will take charge of handling operations in Larnaca and Paphos.

November 2007: 1st 6 months = 1.48 billion (RPK)s (+1.5%) traffic; 4.1 million (FTK)s (-78.6%) freight traffic; 744,000 passengers (+2.4%).

December 2007: Cyprus Airways (CYP)'s ground staff planned to strike December 12 and December 17 & 18 to protest the carrier's plan to outsource ground handling at Larnaca and Paphos to the Swissport & GAP Vassilopoulos joint venture (JV). The strike potentially will affect 107 flights, the airline and two of its unions said. "If need be, our airplanes will fly empty to specific destinations to ferry inbound passengers," (CYP) said in a statement, insisting it will continue operating through the job action. According to news reports from Cyprus, the 140 workers want to remain employees of the airline rather than the (JV). The carrier said no jobs will be lost as a result of the outsourcing of ground handling, which it said will allow it to operate more efficiently at lower cost.

January 2008: 2007 statistics: 3.38 billion (RPK)s passenger traffic +3.7%; +4.7% capacity (ASK)s; -.8 load factor for 72% LF. SEE ATTACHED COMPARISON CHART TO SELECTED OPERATORS - "CYP-2007-STATS."

Cyprus Airways (CYP) signed a joint venture agreement with Swissport/GAP Vassilopoulos to offer ground-handling services.

February 2008: Cyprus Airways (CYP), which had endured losses for four straight years, reported a +€1.2 million/+$1.8 million profit for 2007, reversed from a net loss of -€7.4 million the previous year. "After four difficult years of recording losses in the tens of millions, it appears that (CYP) has finally been able to win the bet over its survival," Chairman, Kikis Lazarides said at a news conference. "Prospects are favorable for registering a profit in 2008."

(CYP) said in a statement that it had "safeguarded its cash-flow through a government-guaranteed long-term loan" that reportedly is €78 million and "now [has] sufficient liquidity to meet its obligations as they arise." It added that it will continue implementing a restructuring plan that aims to "maximize income and reduce expenses."

Total 2007 revenue increased +7.6% to €288.7 million. (CYP) attributed the rise mainly to higher traffic and improved yield, though it did not reveal those figures. Expenses grew +3.6% to €282.8 million, while operating profit was +€5.4 million, which takes into account redundancy compensation of €500,000 paid as part of the restructuring plan's employment reduction initiative.

June 2008: Cyprus Airways (CYP) is considering a partial renewal of its fleet to cut down on its growing fuel bill, it said this week. "We are looking at the possibility of a part renewal of our airplanes in some depth. We expect to have a partly renewed fleet by the next summer season," Chairman, Kikis Lazarides said at a Nicosia news conference, "Reuters" reported. It said (CYP)'s fleet of two A319s, seven A320s and two A330-200s has an average age of 12.5 years. The airline reported a rare profit in 2007 and had anticipated good results this year, but was forced to reconsider its initial forecast owing to climbing fuel costs. "I do not think we can reach the targets we had set for the year, which were quite favorable over 2007," Lazarides admitted. Initial projections of an €82 million/$127.1 million fuel bill this year, were revised to €106 million, he said.

September 2008: Cyprus Airways (CYP) will lease an A319 from (ILFC) (ILF) for six years. It currently operates two A330-200s, two A319s, and seven A320s.

January 2009: Cabot Aviation, on behalf of Aircraft Solutions A320, arranged the purchase of three (V2500-A1)-powered A320-200s from Cyprus Airways (CYP). The first airplane was delivered on January 14 and the other two are due in the first half of this year.

February 2009: Cyprus Airways (CYP) released a statement saying that its 2008 financial results "are expected to be improved compared to the comparatives for 2007," in which it posted a +€1.2 million/+$1.5 million profit that was its first in several years. The board is scheduled to meet February 27 to approve the 2008 accounts. Through the first six months of last year, (CYP) was €7.2 million in the red compared to an €11.6 million deficit through the first half of 2007. Its six-month operating loss was -€7.8 million, narrowed from -€9.8 million the prior year.

(CYP) said it will lease two A320s for six years. A spokesperson told "Reuters" that the deal is with an "Irish company" and that the airplanes will be delivered "by March or April." Several lessors, including (AWAS) (AWW), are headquartered in Ireland.

March 2009: Cyprus Airways (CYP) reported a +€1.7 million/+$2.2 million profit in 2008, up +41.7% from the +€1.2 million earned in 2007, on a revenue increase of +8% to €311.4 million. It credited fuel surcharges and rising passenger numbers for the boost in turnover. Full-year operating profit plunged -64.8% to +€1.9 million from +€5.4 million, as expenses rose +9.9% to €311.3 million. Fuel costs were up +42.1%. The year-over-year comparison in net results was helped by €3.3 million in finance costs in 2007. (CYP) said the uncertainty of the current market made it impossible to forecast its 2009 performance.

May 2009: Cyprus Airways (CYP) canceled six-year leases on two A320s after talks failed regarding delivery dates. The original deal, reached in February, was with an unnamed Irish firm.

July 2009: Cabot Aviation, on behalf of TCS Investment Holding, arranged the purchase of two (V2500)-powered A320-200s from Cyprus Airways (CYP); both airplanes were leased back to (CYP) until the end of October.

August 2009: Cyprus Airways (CYP) entered into a Memo of Understanding (MOU) with CIT Aerospace (TCI) to lease one A320-200 for six years.

September 2009: Cyprus Airways (CYP) posted a -€3.5 million/-$5 million first-half loss, narrowed from a -€7.2 million deficit in the year-ago semester, according to a statement cited by "Reuters." Revenue fell -17% to €116.4 million, although the airline earned +€4.5 million on the sale of three airplanes. (CYP) said in a statement posted on its website that it expects a "decrease in passenger numbers and yields" in the second half and that its full-year results will be "lower in comparison to those of 2008," when it earned a +€1.7 million profit.

November 2009: Universal Asset Management received an ex-Cyprus Airways (CYP) A320 for induction into its end-of-life recycling program.

Cabot Aviation was appointed by Cyprus Airways (CYP) to sell four A320s.

December 2009: Shannon Aerospace (SLD) will complete a "D" maintenance check on one Cyprus Airways (CYP) A320 this month.

February 2010: CIT Aerospace (TCI) announced the delivery of two (V2500)-powered A320-232s (2359, 5B-DCH "Lefkosia;" 4197, 5B-DCG) to Cyprus Airways (CYP). A third is scheduled for delivery in May.

March 2010: Cyprus Airways (CYP) lost -€3.3 million/-$4.4 million in 2009, reversed from a +€1.7 million profit in 2008, as traffic and yield fell sharply. (CYP) attributed the result to the "world economic crisis that adversely affects the airline industry." Revenue dropped -20.1% to €249 million and the operating loss of -€5.7 million compared to a +€2 million surplus the prior year. (CYP) said it has sufficient liquidity to meet its obligations. It sold three older A320s last year and hopes to find buyers for its remaining four owned A320s. It plans to take delivery of four newer leased A320s this year and two in 2011.

May 2010: AJ Walter Aviation (AJW) said it has extended its A320 power-by-the-hour contract with Cyprus Airways (CYP) to include engine line replacement units. The contract covers nine (V2500)-powered A319s/A320s.

June 2010: Cyprus Airways (CYP), a third of whose traffic involves
coming and going to Greece, suffered a -$4 million loss and a negative -2% operating margin in 2009. That reversed a small net profit in 2008. The results were a little better in the second half of last year, with net income around break even. A new airport that opened in Larnaca late in the year led to higher airport costs, and the economic crisis in Greece certainly hurt. For the year, traffic fell -7% (RPK), with London down the most and Beirut up the most.
(CYP) serves about 30 destinations in Europe and the Middle East.

(CYP) will increase its twice-weekly, Larnaca - Brussels service to five-times-weekly from November. The route is flown with an A320 or A319 in a two-class configuration.

August 2010: Cyprus Airways (CYP) is resuming service to Munich later this year:
Larnaca - Munich - Frankfurt - Larnaca: weekly, A320-200 service starting on November 4;
Larnaca - Vienna - Munich - Larnaca: weekly, A319-100 service starting on November 6.

September 2010: The Cyprus Minister of Finance, Charilaos Stavrakis confirmed that the government will conduct a feasibility study to merge Cyprus Airways (CYP), which is 69% owned by the state, with charter subsidiary Eurocypria Airlines (ECY). The study follows (CYP) reporting a half-year loss of -€25.5 million/-$32.4 million.

A source close to (CYP) said (CYP) plans to sell its two A330-200s, which operate mainly on the Larnaca – London Heathrow and Paris (CDG) routes. (CYP)’s fleet also includes seven A320s and three A319s. Eurocypria (ECY) operates six 737-800s. (ECY), which has been state-owned for five years, was originally established as a charter subsidiary of (CYP) in 1991.

November 2010: Cyprus Airways (CYP) launched twice-weekly, Larnaca (LCA) – Munich service and increased twice-weekly, (LCA) – Brussels service to five-times-weekly, on November 1.

January 2011: Cyprus Airways (CYP) said its 2010 financial results are expected "to be significantly more loss making" than 2009. (CYP) is expected to report a full-year loss of around -€30 million/-$38.7 million, widened from a loss of -€3.3 million in the prior year, the government said.

(CYP) increased passenger numbers in 2010 but revenue fell owing to greater competition, the financial crisis in Greece that affected demand on key Greece - Cyprus routes, the weakening of the euro, rising fuel costs and the April Icelandic volcano eruption. (CYP) management and staff must agree to a realistic restructuring plan for the airline to survive, the country's Finance Minister said in November.

March 2011: Cyprus Airways (CYP) and employees' trade unions called on parliamentarians to approve payment of €20 million/$27.3 million to (CYP) to help (CYP) to stay in the air, the "Famagusta Gazette" reported.

Compensation to the cash-strapped airline is for losses incurred owing to the Turkish airspace ban, which forces it to take alternate, more expensive routes to Northern Europe and Russia. Airline employees have agreed to a -9% salary reduction. (CYP) is expecting a -€60 million deficit this year, media reported. (CYP) dropped plans to sell two A330-200s, but one airplane is available for wet-lease.

Olympic Air (OLY) and Cyprus Airways (CYP) signed a wide-ranging cooperation accord aimed at “strengthening of the presence of the two airlines in the wider region of Southeastern Europe,” (OLY) said in a statement. Under terms, the carriers’ code share began March 27 on flights from/to Athens, Rhodes, Heraklion, and Thessaloniki to/from Larnaca and Paphos. From April 15, it will be expanded to cover most domestic and international destinations of (OLY) and (CYP).

Passengers will be able to collect points from (OLY)’s and (CYP)’s Ftequent Flyer Plans (FFP)s for the entire itinerary up to their final destination, regardless of whether one leg of the trip involves one company or the other, and redeem the points they collected in both companies. Cooperation between the two airlines will cover other sectors as well, such as the provision of ground services at the Greece and Cyprus airports, the joint use of VIP lounges, and the exploration of all options for the utilization of the infrastructures of the two airlines.

(OLY)'s Greek competitor Aegean Airlines (CRM) announced it will set up a base in Cyprus at Larnaca with three new 168-seat A320s. (OLY) and (CRM) had planned to merge, but the tie-up has been blocked by the European Commission (EC).

November 2011: As flag carrier for Cyprus, serves more than >20 destinations in Europe, the Middle East and near East and the Gulf. Additional routes are served through code sharing agreements.

Employees = 1,250.

(IATA) Code: CY - 048. (ICAO) Code: CYP (Callsign - CYPRUS).

Parent organization/shareholders: Government of Cyprus (69.62%); & private shareholders (30.38%).

Owns: Eurocypria Airlines (ECY) (100%); & Hellas Jet (HEJ) (100%).

Alliances: Aeroflot Russian Airlines (ARO); Brussels Airlines (DAT)/(EBA); Etihad Airways (EHD); Gulf Air (GUL); (KLM); Syrianair (SYR); & Tarom (TRM).

Main Base: Larnaca International Airport (LCA).

Hub: Paphos Intenational Airport (PFO).

Domestic, Scheduled Destinations: Larnaca; & Paphos.

International, Scheduled Destinations: Amman; Amsterdam; Athens; Bahrain; Beirut; Birmingham; Brussels; Cairo; Damascus; Dubai; Frankfurt; Heraklion; Jeddah; Kiev; London; Manchester; Milan; Moscow; Odessa; Paris; Riyadh; Rome; Tel Aviv Yafo; Thessaloniki; Vienna; Warsaw; & Zurich.

December 2012: Cyprus Airways (CYP) relaunched flights to its second London airport on 19 December when (CYP) began operating twice-weekly from Larnaca (LCA) to London Stansted (STN). (CYP) already flies 16 times weekly to London Heathrow. (CYP) also operated to Stansted between 1997 and last year, when the route was dropped. Although (CYP) is the only carrier operating between Larnaca and Stansted, indirect competition comes from British Airways (BAB) and Aegean Airlines (CRM) at Heathrow, easyJet (EZY) at Gatwick and Monarch (MON) at Luton. In summer, the Stansted route is also operated by Thomson Airways.

January 2012: Recent analysis of 2011 data from the Association of European Airlines (AEA) revealed that among the 30 members who reported data for last year, the fastest-shrinking airline was Cyprus Airways (CYP). The Cypriot national airline reported a -20% drop in passenger numbers from almost 1.6 million in 2010 to just under 1.3 million, and a -23% drop in capacity (as measured in Available Seat Kilometres (ASK)s). For most of the last decade, (CYP) has handled between 1.6 and 1.7 million passengers on scheduled services, so last year’s decline is significant. In recent weeks, the government has indicated a willingness to sell a significant share in the airline to an outside investor. Local reports suggest that Aeroflot (ARO), Middle East Airlines (MEA) and Qatar Airways (QTA) may have shown some interest, although nothing official has been revealed. In the first half of 2011, the airline lost just over €29 million, but the second half results (due before the end of this month) are expected to be better.

Analysis of (CYP)’s schedule this winter shows that compared with last winter, (CYP) has dropped flights to Manchester but has launched new services to London Stansted (on 19 December 2011). For the summer season, (CYP) plans to start twice-weekly flights to Mykonos, Santorini and Rhodes from 1 July. From its main base at Larnaca Airport, the leading country markets for this summer are Greece, Russia and the UK, with these three country markets accounting for almost 65% of all scheduled flights this summer.

Although (CYP) has code share agreements with several airlines (such as Aeroflot (ARO), Alitalia (ALI), Brussels Airlines (DAT)/(EBA), Etihad (EHD), Gulf Air (GUL), (KLM), Middle East Airlines (MEA), Olympic Air (OLY) and Virgin Atlantic (VAA)), (CYP) still faces competition on several of its biggest routes from the likes of Aegean Airlines (CRM) (on Athens, London Heathrow and Thessaloniki routes), Austrian (AUL) (on Vienna), British Airways (BAB) (London Heathrow), and Lufthansa (DLH) (Frankfurt and Munich). During the summer, (CYP) also faces significant competition on its London routes from easyJet (EZY), Monarch (MON), Thomas Cook and Thomson, who all operate from London Gatwick.

The decision by Ryanair (RYR) to establish a base at Paphos, Cyprus’ other international airport, at the beginning of April is likely to add further pressure on Cyprus Airways (CYP). Paphos airport is only around 100 kilometres from Larnaca, so could be considered an alternative by cost-conscious travellers. (RYR)’s Paphos network includes flights to Germany, Greece, Italy and the UK.

As part of its on-going cost-cutting, Cyprus Airways (CYP) has returned its two long-haul A330-200 wide body airplanes to the lessor, leaving it with a fleet of 11 A319/A320 narrow body airplanes. The A330s will be replaced by two A321s that are to be leased for a period of six years with delivery to the airline due in April and May of this year.

Cyprus Airways (CYP) has introduced new services from its Larnaca base:
Larnaca - Brussels National: 6x weekly A319-100/A320-200 service resuming on June 1;
Larnaca - London Stansted: 3x weekly A320-200 service has resumed on December 19.

(CYP) has temporarily cancelled its last remaining route from Paphos for the winter season. It used to serve Amsterdam from the airport in the west of Cyprus as it last destination. (CYP) has also given up its Larnaca - Manchester route on October 31.

A J Walter Aviation (AJW) has been selected by Cyprus Airways (CYP) to provide full power-by-the-hour support for its fleet of 11 A319 and A320s, extending a 2009 contract through to 2016.

(CYP) phased out its two A330-200s and returned them to (ILF). (CYP) plans to add two A321-200s to its fleet for the summer season.

March 2012: Cyprus Airways (CYP) posted a post-tax loss of -€18.9 million/-$25 million for the 2011 full year, compared to a +€232,000 profit in 2010.

(CYP) said the economic downturn, Greek debt crisis, competition and dip in passenger traffic all contributed to the loss.

Total revenue for the year was €212.4 million compared to the previous year’s €236.3 million.

(CYP), which says it needs a capital injection of about €45 million, has been seeking a strategic investor for several years and said it was preparing a plan to ensure the company's viability. The plan will include cutting labor costs, reducing staff numbers and trimming its fleet of 12 A319/A320s.

(CYP) currently only operates four A319s and seven A320s, having sold one A320 along with three spare engines during 2011. (CYP) also returned its only wide body airplane, two A330-200s, to lessors in December 2011 and January 2012. These two wide bodies are to be replaced with two A321s in April 2012 and May 2012.

The Cyprus Government, which owns 69% of (CYP), authorized the airline in February 2012 to move forward with raising fresh capital and a potential sale of some of the Government’s majority stake. The airline plans a +EUR45 million capital injection, which will be raised through the sale of 500.7 million shares.

The combination of a streamlined network and reduced labor roll are expected to reduce operating losses while strengthening (CYP), making it more attractive for potential strategic investors. (CYP) is not alone in its search for strategic investors, however, with a number of carriers, particularly in Eastern Europe, seeking investment. Turkish Airlines (THY) recently stated it had received offers from 15 airlines wishing to be acquired.

Last month, (CYP) was rumored to be a takeover target with Aeroflot (ARO), Qatar Airways (QTA), and Middle East Airlines (MEA) reportedly in discussions with (CYP). (MEA) confirmed its interest in acquiring a stake in (CYP), with Chairman, Mohamad el-Hout stating in mid February 2012 (MEA) believes “there is real potential for us and we are studying it seriously”. Beirut is currently (CYP)’s fifth largest market.

(CYP)’s primary markets are Western and Eastern Europe with almost an even split of operations between the two areas. It also has a notable operation to the Middle East, accounting for 13.6% of its total available capacity.

(CYP) management has highlighted the current situation in Greece as a risk to (CYP) in 2012. With Cyprus being located close to Greece, Cyprus - Greece air links are important to (CYP). (CYP)’s largest route by available seats is Larnaca - Athens, while its third biggest route is to Thessaloniki, the second-largest city in Greece.

Despite the financial crisis in Greece, on 26 March, Cyprus Airways (CYP) launched its second domestic service in Greece, connecting Athens (ATH) and Thessaloniki (SKG) with thrice-weekly frequencies. The 300-kilometre route within the Greek mainland will be served with equipment from the A320s family. While (CYP), which is now for sale, faces competition from both Greek airlines (Aegean (CRM) offers the most frequencies (59 weekly), followed by Olympic Air (OLY)’s 39 weekly services). This will be the second domestic Greek service (CYP) offers. It currently operates Irakleion - Rhodes three times weekly. Greece’s financial situation is likely to affect (CYP) traffic to, from and within Greece as austerity measures further ramp up.

(CYP) is the leading carrier from Cyprus’s main gateway, Larnaca, where it accounts for 31.5% of total capacity. Larnaca features some low-cost carriers (LCC)s including easyJet (EZY) but the (LCC) penetration rate at the airport is currently only 11.6%.

The majority of budget competition in Cyprus is centered at the country’s second main airport, Paphos, where (LCC)s account for 54.6% of capacity. (EZY) alone accounts for 46.7% of capacity at Paphos. Charter carriers contribute 34.6% of capacity at Paphos, with only 10.8% of capacity share provided by full-service carriers.

(CYP) faces limited (LCC) competition. (CYP) operates from Larnaca to London Heathrow and London Stansted while (EZY) operates from Larnaca to London Gatwick. Despite substantive service from (EZY) and Ryanair (RYR), there are no further overlapping routes, even when considering alternative airports. Charter carrier Thomson (TFY) also serves Pahos from London Gatwick and London Luton. In addition, Monarch Airlines (MON) offers Larnaca - London Luton service.

(LCC)s (excluding charter carriers) accounted for 28% of available international seats in Cyprus in 2011. Neighboring Turkey had (LCC)s account for 20% of available international seats whereas the (UK) had a 37% (LCC) penetration rate and Germany 29%.

Of (CYP)'s top ten routes, all from Larnaca, only three are operated solely by (Cyp): Paris (CDG), Amsterdam and Zurich. All others are also operated by other carriers, though primarily only full-service carriers.

(CYP)’s only services from Paphos are to Amsterdam and to Larnaca, with the latter operating once per week to reposition airplanes for the Paphos - Amsterdam service. (CYP)’s lack of direct competition with the (LCC)s is a positive aspect of (CYP)’s network though it highlights the risk if (LCC)s like (AZY) or (RYR) decide to target key (CYP) routes. Larnaca and Paphos are only 128 km apart, but (EZY) has shown both airports can support service to London. While direct competition with (LCC)s is low, the very existence of (LCC)s on routes (CYP) does not serve semi restricts (CYP)'s expansion as it would have to contend with established (LCC)s.

The 2012 summer schedule will see reduced capacity from Cyprus compared to 2011, owing to the replacement of A330s with A321s. (CYP)’s A330-200 airplanes were configured with 295 seats in a two class layout whereas A321 airplanes are typically configured in a two class layout with approximately 186 seats.

(CYP) is likely to begin to remove unprofitable routes and adjust frequencies on other routes as it seeks to streamline its network. Airline management will need to tread carefully as its changes could spark industrial action over its planned reductions in labor costs, which will see (CYP) reduce its workforce. (CYP) will also need to evaluate its fare and product structure to determine if a bundled product is most appropriate in a leisure-heavy market with significant competition from (LCC)s that have unbundled structures.

(CYP) joins a number of small European carriers facing an uncertain future. While the streamlining of its operations may make it more competitive in the short term, an investor may be necessary for (CYP)'s long-term future, even if investors have so far proven elusive to many small carriers in the current economic environment.

(CYP) plans to initially use its two A321-200s it will add to its fleet in spring for its routes from Larnaca airport (LCA) to Athens Eleftherios Venizelos International airport (ATH), London Heathrow airport (LHR), Milan Malpensa airport (MXP), Moscow Sheremetyevo International airport (SVO), Sofia International airport (SOF) and St Petersburg Pulkovo airport (LED).

April 2012: Cyprus Airways (CYP) plans to add a second route serving the Greek market on October 1 when it will launch daily, A321-200 service between Athens Eleftherios Venizelos International airport (ATH) and London Heathrow airport (LHR).

Cyprus Airways (CYP) could have to be closed down if no strategic investor is found that is willing to invest 45 million EUR in (CYP) according to statements made by (CYP) (CEO), George Mavrocostas. Aeroflot (ARO), (MEA) - Middle East Airlines, Qatar Airways (QTA) and Transaero Airlines (TRX) have all held talks with the struggling Cypriot national carrier.

May 2012: Cyprus Airways (CYP) has affirmed that Canadian conglomerate Triple Five is interested in acquiring a majority stake in (CYP).

(CYP) said that Triple Five had expressed an interest in a letter dated May 4 and requested information about (CYP)’s financial situation and business activities, as well as other relevant data.

In the letter, Triple Five said it would “make a final decision on the matter after evaluating this data,” (CYP) said.

In late April, (CYP) had dismissed press speculation that Triple Five had approached the Finance Ministry with a proposal to buy a 70% stake in the airline. The government of Cyprus is the major shareholder.

(CYP) had also rejected claims that expressions of interest had been received from Lufthansa (DLH), Aeroflot (ARO) and Qatar (QTR), insisting that no specific proposal had been submitted by any potential investor. However, the statement confirming Triple Five’s interest also confirmed that a number of other organizations had expressed an interest, but had not submitted concrete proposals.

Representatives of Triple Five reportedly visited Cyprus earlier this year, which resulted in Group Chairman, Nader Ghermezian announcing plans for significant investment in Cyprus, especially in the energy, banking, tourism and infrastructure sectors, as well as an unspecified quantity of government bonds.

June 2012: CAL Cargo Air Lines (CRG) and (MEA) - Middle East Airlines are reportedly interested in taking over the 69% stake of the government of Cyprus in national carrier Cyprus Airways (CYP). Previously, Canadian investor Triple Alpha had already confirmed its interest in Cyprus Airways (CYP). (CRG) already cooperates with Cyprus Airways (CYP) on cargo services.

Cyprus Airways (CYP) has taken delivery of its first ex-Royal Jordanian (RJA) A321-200 (2730, 5B-DCO) on June 12. It will shortly add a second ex-(RJA) A321 (2793, 5B-DCP).

July 2012: 1st half = net loss of -$41 million, with -21% capacity (ASK)s.

Cyprus Airways (CYP) is now hiring consultants to assist with a new business plan and direction.

August 2012: 2 A321-231 (2730, 5B-DCA "Apostolos Andreas;" 2793, 5B-DCP), ex-(JY-AYH), (ILF) leased.

October 2012: As an attempt to merge the two biggest Greek airlines is again underway, Cyprus Airways (CYP) chose to expand its presence in the Greek domestic market. On 28 October, (CYP) launched five routes between two airports in the Greek mainland, Athens (ATH) and Thessaloniki (SKG), and two island airports; Rhodes (RHO) and Heraklion (HER) on Crete.

Gulf Air (GUL) is set to expand its existing code share partnership with Cyprus Airways (CYP).

The two carriers have code shared on Bahrain - Larnaca flights since 1994. Under the new arrangement, links to/from Greece will improve, as (GUL) puts its code on (CYP) flights from Larnaca to Athens and Thessaloniki. Similarly, travelers from the latter two cities will be able to connect to more than >48 (GUL) destinations via Larnaca.

“Until today, Larnaca remains a strategic route and key market for us connecting Cyprus with Bahrain, the Middle East, Africa, and Asia,” (GUL) (CCO), Karim Makhlouf said.

November 2012: Cyprus Airways (CYP) retained AirFrance/(KLM) Consulting to help (CYP) restructure with both government aid and major labor concessions, assuming (CYP) can acquire them.

March 2013: Cyprus Airways (CYP) reported a provisional full-year net loss of -€55.8 million/-$72.7 million for 2012, more than doubling its -€23.9 million loss in the year-ago period. (CYP) issued a stark warning that its future hangs on the success of its restructuring plan.

(CYP) said its ability to continue operating as a “going concern” for the next 12 months depends on the successful implementation of its turnaround plan, an increase in its share capital, and (EU) approval for its rescue aid application, which was filed December 13, 2012.
“The company recognizes that the losses incurred in 2012 should not be repeated. The company will become viable only with the drastic reduction of operational losses and the only way to achieve this goal is the immediate implementation of the new restructuring plan, including the capital injection provided for in the plan.”

Revenue for the year fell -17.5% to €175.5 million, due to the cutting of unprofitable routes, reduced demand caused by the downturn and stronger competition. Expenses fell -16.7% to €224.9 million, although the comparative figure from 2011 included redundancy payments and an impairment on the sale of two A319s. This produced an operating loss of -€49.7 million, compared to -€25.5 million in 2011.

The turnaround plan, prepared by AirFrance Consulting, includes a capital boost, staff cuts, increased productivity, outsourcing of some departments, securing new collective agreements, a streamlined schedule, product improvement and expansion into the Greek market.
“The implementation of the measures of the turnaround plan is expected to lead to a drastic reduction in the operating losses for the current year in comparison to 2012 and it will have a favorable impact on the long-term viability of the company. It should also be noted that the efforts for identifying a strategic investor will continue, while the government has already proceeded with a rescue aid application for the company to the European Union (EU,” (CYP) said.

On February 7, the Cypriot government increased its shareholding in (CYP) from 69.6% to 93.7% through a rights issue.

European antitrust regulators are evaluating whether Cyprus Airways (CYP) illegally received more than >€100 million/$130 million in public support. In the meantime, the European Commission (EC) has barred the Cypriot government from providing any further public support to the airline without prior approval, while it assesses whether a €31.3 million capital increase and €73 million rescue aid loan fall outside of European law.

Earlier this year, the Cypriot State contributed €31.3 million to a capital increase, while “private participation was minimal,” according to the (EC). This could break rules where government owners must act in the same manner as a private investor. “At this stage, the (EC) has doubts that the capital increase was made on market terms. Indeed, in view of the company's financial difficulties and viability prospects, the majority of private shareholders decided not to participate in the capital increase,” the (EC) said.

Cyprus Airways (CYP) also “appears” to have received payments from the €73 million rescue aid loan, potentially breaking the “standstill obligation” where state aid must not be granted before the (EC) has approved it. This approval is unlikely because (CYP) received rescue and restructuring aid in 2007, so it is blocked from receiving further bailout for 10 years.

Announcing a doubling of its full-year net losses, (CYP) recently said its future depended on getting the green light from the (EC).

Air Baltic (BAU), Adria Airways (ADR) and Estonian Air (ENA) are also being investigated by the (EC) for state aid.

April 2013: Cyprus Airways (CYP) must receive financial aid or it will be forced to shut down operations, several Cyprus based media have reported.

The Cyprus government is talking about three scenarios for the financially troubled carrier: Shut down the company immediately, continue operations during the summer season or continue operations further. However, Cyprus Airways (CYP) Chairman, Stavros Stavrou told "the Famagusta Gazette" the last scenario would include -560 job cuts, payment cuts and fleet reduction from 11 A319/320s to six airplanes, plus a reserve. (CYP) also would need financial aid of €83.2 million/$107 million over the next three years.

Cyprus Airways (CYP) was close to shutting down in 2011, but received financial aid of €20 million annually from the state. Now, European antitrust regulators are questioning whether Cyprus Airways (CYP) illegally received more than >€100 million in public support. The European Commission (EC) has barred the Cypriot government from providing any further public support to the airline without prior approval, while it assesses whether a €31.3 million capital increase and €73 million rescue aid loan falls outside of European law.

Cyprus Airways (CYP) reported a provisional full-year net loss of -€55.8 million for 2012, more than doubling its -€23.9 million loss reported in the year-ago period.

Cyprus Airways (CYP) commenced flights on the 3,400 km route from Paphos (PFO) to Moscow Sheremetyevo (SVO) on 25 April. The airline, which already serves the Moscow airport with daily flights from Larnaca, now offers weekly services from Paphos. Flights on the new route are operated using A320s. As the recent banking crisis in Cyprus revealed, the country is a popular destination for wealthy Russians.

May 2013: Lebanon’s central bank, Banque du Liban, has blocked a proposed takeover of financially troubled Cyprus Airways (CYP) by Middle East Airlines (MEA). Central Bank Governor, Riad Salameh said the bank could not approve (MEA)’s bid because it could increase (MEA)’s exposure to risk, according to Lebanon’s "Daily Star."

The paper quoted Salameh as saying: “Commercially, this matter is left to (MEA) to assess the acquisition. But in principle, the central bank, which controls the majority of the national carrier, cannot approve (MEA)'s acquisition of (CYP). The duty of the Central Bank is to use its money to protect the monetary and economic situations and for this reason we cannot bear more risks for companies that belong to us. Unless (MEA) becomes a private company, it is difficult for the airline to expand outside Lebanon because this does not suit the role and purposes of the central bank.”

Last month, Cyprus Airways (CYP) and the Cypriot Finance Ministry held preliminary talks with (MEA). However, (CYP) said it also had consultations “with other companies that had shown interest,” including China’s Beijing Yi Xiang Da Investment Company. It stressed, however, that “consultations are at an early stage and there is currently nothing further to announce.”

Communications Minister, Tasos Mitsopoulos has reportedly confirmed that (MEA) is no longer interested in investing in (CYP), but reiterated that other investors were exploring investment possibilities.

In the meantime, the government of Cyprus has adopted a restructuring plan proposed by the board of directors to save the struggling airline from closure. It includes reducing its fleet to just six airplanes plus a spare, as well as staff layoffs. However, according to the "Cyprus Mail," the entire board of Cyprus Airways (CYP) resigned in protest at the government’s promise to find €20 million/$26 million in compensation for workers laid off under the restructuring plan. Local media sources said the board was simply unable to find the compensation money agreed between the government and the unions.

AirFrance (AFA) and Cyprus Airways (CYP) have entered into a new code share agreement. (AFA) will offer (CYP) flights on Larnaca - Paris, Larnaca - Athens, Athens - Heraklion, and Athens - Rhodes.

Flights between Paris and Larnaca will offer multiple connections via Athens on domestic flights within Greece, flown by (CYP). (AFA) passengers will benefit from connections at Paris Charles de Gaulle Airport, to and from Cyprus. (CYP) will sell (AFA) flights between Athens and Paris. Passengers on both carriers’ flights can earn miles in frequent flyer programs on all code share services. To offer convenient connections, (CYP) has moved from Terminal 1 at Paris Charles de Gaulle to Terminal 2, which is where (AFA) is located.

December 2013: Russian and Cyprus aviation authorities have agreed to designate second carriers (in addition to Aeroflot) on several routes between the countries.

January 2014: Cyprus Airways (CYP)’s plans to sell a pair of London Heathrow (LHR) slots to Qatar Airways (QTA) have been thwarted after it was undercut by another airline.

(CYP) was in final negotiations to sell one of its 2 pairs of scarce (LHR) slots, but the deal fell through when another unidentified airline offered (QTA) a slot pair for a better price.

The plan had received mixed internal buy-in within Cyprus Airways (CYP). It is extremely unlikely that the deal will be resurrected.

Last year, Etihad Airways (EHD) bought 3 pairs of (LHR) slots from India’s Jet Airways (JPL) for $70 million under a sale and lease-back agreement.

Other recent transactions include Aer Lingus (ARL), British Airways (BAB) and Virgin Atlantic (VAA) securing 12 pairs following (BAB) parent company, (IAG)’s takeover of bmi (BMA).

February 2014: The European Commission (EC) has launched in-depth investigations into the financial rescue deals for Cyprus Airways (CYP) and Estonian Air (ENA), to verify whether cash infusions breach European Union (EU) state aid rules. Earlier investigations into both carriers for similar suspected infringements are still ongoing.

In Cyprus Airways (CYP)’s case, the (EC) will investigate the Mediterranean island government’s plans to support the restructuring of the national carrier with €103 million/$139 million. The (EC) said it would “investigate in particular whether the restructuring plan is suitable to make Cyprus Airways (CYP) viable without continued state support and to offset the competition distortions created by the state aid.” It also has concerns as to whether (CYP) is making a sufficient contribution to the cost of restructuring. Cyprus Airways (CYP) has been loss-making for several years.

The opening of an in-depth investigation gives interested 3rd parties an opportunity to comment on the measures under assessment. The (EC) gave notice of its concerns last year.

Last December, (CYP) had notified the (EC) of a €102.9 million aid package to restructure Cyprus Airways (CYP) over a 5-year period. This included a €31.3 million capital injection granted in 2012, conversion of €63 million of debt to equity and €8.6 million to cover the deficit of the company's Provident Fund, a benefit scheme for some employees.

(EU) rules say that governmental restructuring aid may be granted only once in 10 years, so that chronically weak companies are not kept alive artificially, to the detriment of better-run competitors. The (EC) noted it had previously approved restructuring aid for Cyprus Airways (CYP) in 2007 and that since then, (CYP) had received the 2012 capital injection and a €34.5 million loan the following year.

In Estonian Air (ENA)’s case, the (EC) is looking at whether a 2013 €40.7 million restructuring grant is legal. As with Cyprus Airways (CYP), the (EC) has doubts as to whether this will ensure (ENA)’s long-term viability. Similarly, it said that earlier state interventions totaling €57 million since 2009 may be deemed to have breached the “once in a decade” ruling.

Several other (EC) investigations are underway into (LOT) Polish Airlines, airBaltic (BAU), Adria Airways (ADR) and (SAS) Scandinavian Airlines.

June 2014: Cyprus Airways (CYP) will move out of London Heathrow (LHR) Airport after selling its remaining slot pair to American Airlines (AAL).

The cash-strapped national carrier, which has faced financial problems for several years, has sold the daytime slot for $31 million. It will move its Larnaca to London service to Stansted Airport (STD) from September 14.

In March, (CYP) sold its evening (LHR) slot pair to Middle East Airlines (MEA). In a filing with the Cyprus Stock Exchange at the time, it said it had received €6.3 million/$8.6 million for the earlier sale. (LHR) is heavily slot-constrained, which makes slots there valuable. The (MEA) sale came after an earlier planned deal with Qatar Airways (QTA) fell through.

In its stock exchange filing announcing the new slot sale, (CYP) said it would “ensure a very important revenue of $31 million, which will enhance the liquidity of the company for 2015.” It would also satisfy a key condition of (CYP)’s current restructuring plan, which calls for the sale of (LHR) slot pairs.

The Larnaca to (LHR) service is not performing well and moving to Stansted (STD) will allow (CYP) to vary the frequency and timing of the service to try to improve the situation, according to the filing.

The European Commission (EC) is currently investigating past injections of around €100 million to the carrier, which is 93.67% owned by the Cypriot government. A judgment on whether the aid was allowable under European competition rules is expected later this year and the filing indicated the value of the last slot pair could have been be adversely affected, if the (EC)’s ruling goes against (CYP).

July 2014: The government of Cyprus has officially put Cyprus Airways (CYP) up for sale in a final attempt to save (CYP) from bankruptcy.

Last week, the government published a call for expressions of interest (EOI) from “strategic and/or financial investors” for acquiring either “shares or a significant bundle of assets” of (CYP).

The government of Cyprus is the major shareholder in (CYP), holding a 93.67% stake, with the remainder in the hands of private investors. The government stressed the (EOI) did not constitute “an offer or invitation to subscribe for or purchase” any shares and related only to “the submission of a non-binding intention to investigate the possibility of submitting a binding offer.”

(EOI)s must be submitted on July 23.

Communications Minister, Marios Demetriades has been widely quoted in local media as saying that without strategic investment funding, (CYP)’s future hangs in the balance.

The European Commission (EC) is investigating whether Cyprus Airways (CYP) must repay >€100 million/$135.2 million of state aid aimed at helping the airline restructure. (CYP) has also been stripping assets to prop up its balance sheet.

Last month, Cyprus Airways (CYP) sold its last 2 remaining slots at London Heathrow (LHR) to Middle East Airlines (MEA) for $31 million ((CYP) will be moving its UK operating base to London Stansted Airport in September), and (CYP) has reportedly sold and leased back 5 of its fleet of 6 airplanes to release funds.

The "Cyprus Mail" quoted Minister, Demetriades as saying: “In the medium term, [Cyprus Airways (CYP)] is not viable without a strategic investor. It is certainly viable in the short term, unless the European Commission (EC)’s decision is that it needs to return the government money it has received. This government, as well as the previous government, both looked for a strategic investor, but without a formal procedure, it is impossible to tell whether real interest exists. But in any case, any potential investors will require assurances that the European Commission (EC)’s decision will not fall in their laps.”

August 2014: Ryanair (RYR) confirmed it had submitted a non-binding offer for ailing Cypriot national carrier, Cyprus Airways (CYP).

(RYR) is understood to be one of 15 interested parties, including a number of other airlines that have submitted non-binding proposals in time to meet the deadline. Other carriers that are interested in possibly acquiring the 93.67% stake in the airline currently owned by the government of Cyprus, include Greece’s Aegean Airlines (CRM), Romania’s Blue Air, and Israel’s Arkia Israeli Airlines (ARK), according to local media reports.

(RYR) (CEO), Michael O’Leary traveled to Cyprus for talks with the Cypriot government regarding a possible interest in the airline, and a similar framework meeting was held with (CRM) earlier.

However, O’Leary subsequently said he was primarily interested in securing a Cypriot air operator’s certificate (AOC) to tap the Eastern Mediterranean market, which (RYR) believes is underserved.
He said (RYR) “submitted an expression of interest, principally because the Cypriot government asked us to,” but said that (RYR) was “not particularly interested in Cyprus Airways (CYP).”

According to local media reports, Communications & Works Minister, Marios Demetriades said the ministerial committee handling the Cyprus Airways (CYP) sell-off would “review all proposed business plans and proceed with a short list so as to jump into the binding stage. We hope that by end of September, beginning of October, we will end up with the best solution.”

Key conditions relating to any proposed takeover are understood to include the requirement for Cyprus to remain (CYP)’s base and for as many staff as possible to retain their jobs.

Meanwhile, former permanent Secretary at the Communications & Works Ministry, Makis Constantinides has been confirmed as the government’s choice to replace outgoing Cyprus Airways (CYP) Chairman Tony Antoniou who recently resigned, according to the "Cyprus Mail."

September 2014: Cyprus Airways (CYP) began flights from Larnaca (LCA) to London Stansted (STN) on September 14th due to moving its services from London Heathrow (LHR). (CYP) sold its last slot pair at (LHR) to American Airlines (AAL) for US 31$ million to help its difficult financial position. The 3,256 km sector will be flown daily, utilizing (CYP)’s 162Y-seat A320s. There is no direct competition on this airport pair, but an array of airlines are providing indirect competition by flying to London Luton (Thomson Airways (ATZ)/(TFY), Monarch Airlines (MON)), London Gatwick (British Airways (BAB), Norwegian (NWG), Thomas Cook Airlines (GUE)/(JMA), Thomson (ATZ)/(TFY), easyJet (EZY), Monarch (MON)) and London Heathrow (BAB).

December 2014: Cyprus Airways ((IATA) Code: CY, based at Larnaca) (CYP) is facing potential imminent closure after the New Year holidays according to a news report by the Cypriot newspaper "Kathimerini."

According to the report, Alecos Michaelides, the country's Chairman of the Air Licensing Authority has given Cyprus Airways (CYP) until January 8 to present fully audited financial statements for the 2014 financial year and to "provide evidence that is a going concern."

Cyprus Airways (CYP) is also under investigation by the European Union (EU), which is planning to rule in 2015 whether a 2012 rescue package and 2013 capital increase by the Cypriot government violated (EU) state aid rules. A shadow of its former self, (CYP) currently operates 6 A320-200s.

January 2015: News Item A-1: Shares of Cyprus Airways (CYP) are being delisted from the Cyprus Stock Exchange on January 13, bourse authorities said, in a fresh blow to the ailing carrier that is under (EU) scrutiny over concerns that it received illegal state aid.

(CYP), which is majority owned by the state, had failed to submit financial reports and results in 2012, 2013 and for the 1st half of 2014, a stock exchange statement said. Significant obligations of the company had not been observed, placing investors at risk. The European Commission (EC) is investigating whether (CYP) received state aid in contravention of (EU) rules on 2 occasions: a EUR73 million/US$87.9 million rescue package in 2012 and a EUR31.3 million capital increase in early 2013.

Attempts to find a strategic investor in (CYP), which employs about 500 people, flopped last year.

The timing of the (EU) ruling is unclear, but it has been widely reported that the company could face imminent closure if it is forced to repay the money it received.

News Item A-2: Cyprus Airways (CYP) shares are being delisted from the Cyprus Stock Exchange on January 13. (CYP) did not submit and publish financial reports and results for 2012, 2013 and for the 1st 6 months of 2014, according to a stock exchange statement.

Significant obligations of the company had not been observed, placing investors at risk, the statement added. Some sources said that the delisting might be a mechanical reaction of the stock exchange unrelated to the actual trading performance of (CYP).

Cyprus Airways (CYP), which is majority-owned by the state, faced significant troubles after the Cypriot financial crisis of 2012 - 2013. In February 2014, the European Commission (EC) launched in-depth investigations into the financial rescue deals for (CYP) to verify whether cash infusions breach European Union (EU) state aid rules.

In July 2014, the government of Cyprus officially put (CYP) up for sale in a final attempt to save the airline from bankruptcy. But since July the country´s government has not found a buyer.

News Item A-3: Cyprus Airways (CYP) suspended operations on January 9th, after the European Commission (EC) ordered it to pay back >€65 million/$76.9 million in illegal state aid, plus interest.

The (EC) ruled (CYP) had “no realistic perspective of becoming viable without continued state subsidies.” “(CYP) has received large quantities of public money since 2007, but was unable to restructure and become viable without continued state support. Therefore, injecting additional public money would only have prolonged the struggle, without achieving a turnaround. Companies need to be profitable based on own merits and their ability to compete, and cannot and should not rely on taxpayer money to stay in the market artificially,” Competition Commissioner, Margrethe Vestager said.

Since February 2014, the (EC) has been probing a package of over >€100 million in (CYP) restructuring aid, of which “>€65 million plus interest” was deemed to be in breach of (EU) state aid rules. (CYP) was ordered to “pay back all incompatible aid received,” triggering (CYP)’s grounding.

The Cypriot government confirmed the “immediate termination of the flight program of (CYP)” and instructed stranded passengers to contact travel agency, Top Kinisis Travel Public.

According to the agency’s Marketing Manager, Andreas Kakkouras, flights were suspended at around 18:40 local time. He was unable to immediately comment on how many passengers were affected, or whether operations are likely to resume.

Another Top Kinisis Travel Public employee said the agency will be working through the night, chartering flights to get passengers to their destinations. “The Republic will undertake fully the cost of the alternative flights and therefore the passengers will not be burdened in any way,” the government said.

This offer applies to all passengers in possession of tickets up to and including February 9. “For the remaining passengers, with departure date from February 10 and onwards, a new announcement will be made in the coming days,” it said.

Ryanair (RYR), which was 1 of the potential bidders for Cyprus Airways (CYP), has already come forward offering rescue fares for stranded passengers.

(CYP), which is 93.67%-owned by the Cypriot State, had been in “economic difficulties for many years,” according to the (EC) findings. In 2007, the (EU) cleared a €95 million restructuring package, but by 2012, Cyprus wanted to plough another €73 million into (CYP).

“Several tranches of this loan amounting to in total €34.5 million were paid out in breach of (CYP)’s obligation to await the result of the (EC)'s state aid scrutiny,” the (EC) said. This was followed by yet another €31.3 million government-funded capital injection between September and December 2012, triggering the (EC) to open a further investigation in March 2013.

“In October 2013, (CYP) notified to the (EC) a €102.9 million aid package to restructure Cyprus Airways (CYP). The package included the €31.3 million capital injection mentioned above, a conversion of debts into equity amounting to €63 million and €8.6 million to cover the deficit of the company’s Provident Fund, an employee benefit scheme. The (EC) opened an in-depth investigation in February 2014 to assess the measures,” it said.

Under (EU) rules, a company is only allowed to receive restructuring aid once in any 10-year period. Furthermore, Cyprus Airways (CYP) failed to contribute enough to its own restructuring, falling “significantly below” the 50% minimum threshold.

“The (EC) also found that (CYP)’s restructuring plan is based on unrealistic assumptions and does not sufficiently reflect different market scenarios. The proposed restructuring measures do not appear appropriate to address the circumstances that led to Cyprus Airways (CYP)’s difficulties. Moreover, the proposed restructuring period is longer than what the (EC) has authorized in other airline restructuring cases,” it concluded.

In a similar case, Malev (HGA) was ordered to pay back its illegal state aid in 2012, leading to its ultimate closure.

February 2016: Russia and Cyprus have agreed to remove “all the limitations on the number of designated airlines of both sides on agreed routes” between the countries. The liberalization was established in a memorandum of understanding (MOU) signed by Russia and Cyprus aeronautical authorities on March 16, 2012, but became effective in January 2015, after a letter exchange between the administrations.

Cyprus authorities also asked Russia to allow non-Cyprus but European Union (EU) carriers to operate flights on the routes. “We take this opportunity to urge you to consider on an exceptional basis the designation of European carriers, which are established in Cyprus, by the Republic of Cyprus, to operate routes between Russia and Cyprus. This is especially important as at this time, almost a year after the termination of the flight program of Cyprus Airways (CYP), there is no national or other Cypriot carrier which could operate these routes. We believe that this arrangement will provide a better equilibrium between our 2 countries,” Civil Aviation official, Antonis Lemesianos said in the letter.

Bilateral agreements between Russia and most other countries stipulate that flights can only be operated by airlines that are owned and managed by residents of the two countries. The non-residential ownership was the main obstacle for Budapest-based Wizz Air (WZZ) to get the designation for the Budapest to Moscow route after Malev (HGA) ceased operations and gave Aeroflot (ARO) a monopoly on the destination for a while.

In July 2015, Russian airlines asked aviation authorities not to make changes of this kind in the Russia - Cyprus agreement.

December 2016: A newly launched Cyprus Airways (CYP) has taken delivery of its 1st Airbus A319 aircraft on December 1. (CYP), which expects to get an air operator’s certificate (AOC) before the end of 2016, is finalizing its route network and preparing to launch ticket sales.

(CYP)’s fleet will comprise A319 aircraft, which will fly to European and Middle East countries. The brand "Cyprus Airways" is used by Charlie Airlines, which won the right to work under the Cyprus name in July 2016. The 10-year brand deal was signed by the Cyprus government and Charlie Airlines.

Charlie Airlines was founded by Russia’s (S7) Group co-owner Vladislav Filev, who told journalists in March 2016 the carrier would begin operations before the end of the year. According to (CYP)’s Commercial Director Natalya Popova, a new airline team has been formed from Cyprus and European aviation specialists.

Cyprus has been without a locally based airline since national flag carrier Cyprus Airways (CYP) went out of business in January 2015 after a long period of decline.

At the beginning of February 2016, it was announced that new Cypriot low-cost carrier Cobalt planned to start operations at the end of March, once its (AOC) was finalized. Cobalt (CEO) Andrew Pyne also launched Russian low-cost carrier Avianova in 2009.

March 2017: The new startup carrier Cyprus Airways (CYP) has secured its air operator’s certificate (AOC) and plans to launch operations “very soon.” (CYP) received its 1st aircraft, an Airbus A319, on December 1, 2016. At the time, (CYP) said it planned to secure the (AOC) before the end of 2016.

Giving a March 14 update via its Facebook page, Cyprus Airways (CYP) said it had received the (AOC) and will “begin flying soon.”

Larnaca-based Cyprus Airways (CYP) plans to operate A319s to destinations in Europe and the Middle East. (CYP)’s website is not yet live.

The "Cyprus Airways" brand was secured by Charlie Airlines in July 2016 under a 10-year deal with the Cypriot government. Charlie Airlines was founded by Russia’s (S7) Group co-owner Vladislav Filev.

A (S7) (SBR) spokeswoman confirmed the (AOC) and added that the startup also needs a commercial transport license before it can sell tickets and launch operations.

Cyprus has been without a locally based airline since national flag carrier Cyprus Airways (CYP) went out of business in January 2015 after a long period of decline.

April 2017: New startup carrier Cyprus Airways (CYP) will start operations in June with "scheduled flights to 3 to 4 short-haul destinations and charter flights in collaboration with tour operators," a (CYP) spokesperson said. The schedule will be announced after the Easter holiday.

The spokesperson added that (CYP) had filed for Larnaca to Heraklion service, effective June 28, "as a preliminary schedule into the (OAG) Schedules Analyzer for testing purposes for the new airline's website."

(CYP) will operate 1 Airbus A319 aircraft, which was delivered in December 2016. The new airline has received a commercial license from the Air Transport Licensing Authority, concluding the licensing phase. The carrier secured its air operator's certificate last month.

The next launch phase is planned for March 2018. "We will receive a 2nd A319 in early 2018 and we are now looking to add further additional aircraft by the end of next year. In autumn 2017, we will announce our revised and extended route network that will be launched in March 2018," the spokesperson said.

The Cyprus Airways brand was secured by Charlie Airlines in July 2016 under a 10-year deal with the Cypriot government. Charlie Airlines was founded by Russia's (S7) Group co-owner Vladislav Filev.

Cyprus has been without a locally based airline since national flag carrier Cyprus Airways went out of business in January 2015 after a long period of decline.

June 2018: News Item A-1: Cyprus Airways (CYP) added another European airport to its network on June 1, with (CYP) now serving Prague (PRG) from its base at Larnaca (LCA). This comes off the back of the airline’s launches to Verona and Zurich. (CYP) will operate a weekly (Fridays) flight on the 2,306 km sector to the Czech Republic capital, with competition coming from Travel Service which offers 3x-weekly.

From July 2, (CYP) will add a 2nd weekly (Mondays) rotation to Prague, with all flights scheduled to be flown using (CYP)’s A319s, of which it presently has 2. With this launch, (CYP) now operates to 9 destinations from Larnaca, with a 10th (Chania) scheduled to begin on July 14, with (CYP) planning to serve the Crete airport 2x-weekly. By the peak of summer 2018, (CYP) will offer 34x-weekly departures from Larnaca.

News Item A-2: Cyprus Airways (CYP) appointed (TAL) Aviation as General Sales Agent (GSA) for Switzerland.


Click below for photos:
CYP-A319 - 1st 2017-03.jpg
CYP-A319 - 2016-11.jpg
CYP-A319 5B-DCX 2018-06.jpg
CYP-A319-132 - BO
CYP-A319-132 - O
CYP-A320-232 - 2013-09
CYP-A321-231 - 2012-10

August 2018:

0 A310-203 (CF6-80A3) (300, /84; 309, /84; 352, /85), RETURNED, 3 LEASED TO (IRN) 2001-01. 309; 352; SOLD TO (ILF), LEASED TO (WFS) 2004-04. 28C, 213Y.

0 A310-204 (CF6-80C2A2) (486, /89), RETURNED, 1 LEASED TO (IRN) 2001-01. WINGLETS. 28C, 220Y.

1 ORDER (2018-02) A319-100:

1 A319-132 (V2524-A5) (1729, /02 5B-DBO "NIKOKLIS; 1768, /02 5B-DBP "CHALKANOR"). 12C, 114Y.

0 A319-132 (V2524-A5) (2383, 5B-DCN "LIMASSOL"), (ILF) 6 YEAR LEASED. 12C, 114Y.

0 A319-132 (V2524-A5) (2718, /06 5B-DCF "LARNAKA"), (ILF) 6 YEAR LEASED 2008-11. 12C, 114Y.

0 A320-231 (V2500-A1) (028, /89 5B-DAT "PRAXANDROS;" 035, /89 5B-DAU "EVELTHON;" 037, /89 5B-DAV "KINYRAS;" 038, /89 5B-DAW "AGAPINOR;" 180, /91 5B-DBA "EVAGORAS") (256, /92 5B-DBB "AKAMAS;" 295, /92 5B-DBC "TEFKROS;" 316, /92 5B-DBD "ONISILLOS;" 414, /93 5B-DBJ; 430, /93 5B-DBK). +1 ORDER (249), EX-(SAA), (GAX) LEASED. (414; 430) EX-(TSD), (ILF) 3 YEAR LEASED; 414; 430; WET-LEASED TO (ECY) 2001-02. 430 RETURNED (ILF), LEASED TO (CMA) 2003-06. 028 PARTED OUT 2005-03. 256 RETURNED 2011-01. 035; 037; 038; RETURNED. 25C, 131Y; OR 162Y.

0 A320-232 (V2500-A1) (425, /03 SX-BVA, 2003-05; 1992, SX-BVB; 2016, SX-BVC), (CIT) (TCI) LEASED, FOR "HELLAS JET" (HEJ) OPERATIONS. 162Y.

0 A320-232 (V2527-A5) (2108, 5B-DCJ "AMATHUS;" 4197, 5B-DCG), (TCI) LEASED 2010-02. 180Y.

0 A320-232 (V2527-A5) (2275, /04 5B-DCK "PAFOS;" 2334, /04 5B-DCL "PENTADAKTYLOS;" 2343, /04 5B-DCM "PENTADAKYTYLOS"), (TCI) LEASED 2010-02. 8C, 150Y.

0 A320-232 (V2527-A5) (2359, 5B-DCH "LEFKOSIA;" 4197, /10 5B-DCG "APHRODITE" - - SEE PHOTO - - "CYP-A320-214 - 2013-09"), (TCI) LEASED 2010-02. 15C, 131Y.

0 A321-231 (V2533-A5) (2730, 5B-DCA "APOSTOLOS ANDREAS" - - SEE PHOTO - - "CYP-A321-231 - 2012-10;" 2793, 5B-DCP), EX-(JY-AYH), EX-(RJA) 2012-06. (ILF) LEASED. 20C, 171Y.

0 A330-243 (TRENT 772B-60) (505, /02 5B-DBS "AMMOCHOSTOS;" 526, /03 5B-DBT "KERYNEIA"), 6,559 NM, (ILF) 10 YEAR LEASED. RETURNED 2011-12. 30C, 265Y.


Makis was the former permanent Secretary at the Communications & Works Ministry.











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