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CAIR: Redundant staff at 156

21/02/2011 11:41
The number of persons that will withdraw from Cyprus Airways will reach 156, according to a document submitted to the House Finance Committee by the Management.

The Management’s initial estimate was that withdrawals would concern 140 persons.

According to the document, however, it is estimated that from the withdrawal of 156 persons with total cost of €9 million in late March, the Company would save €3.8 million in 2011.

As for the savings from the salary cut, they will reach €4.8 million for the same year.

In addition, the Company will save €0.6 million from the drop in staff cost, such as the closing of several offices abroad and the undertaking of operations by representatives.

The drop in the staff cost and the cut in operating expenses is one of the total three parts of the consolidation package and the only one to be in process of enforcement.

Another part concerns the decline in operating expenses with the rationalization of the flight schedule and the increase in revenues with the strengthening of the activities in profitable itineraries, such as that of St. Petersburg.

CAIR will also lease an aircraft to a third company together with the crew so as to enjoy additional revenues of €14 million.

The Company also expects that it will save €5 million per annum if the agreement for the drop in airport charges by 20% with Hermes Airport is achieved.

The document also noted that the company will proceed with the fuel management plan in order to reduce consumption by 2%.

The House Finance Committee is urged to take a decision for the government’s proposal, which provides for compensations of €20 million as a result of the losses that the company suffers from the Turkish embargo.

The cost concerns 2004 – 2010.

According to the document, the government decided to cover the cost of loss with €5 million on an annual basis.