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It’s been a while since I’ve devoted attention to fastjet (LSE:FJET), its share price and its operations. That doesn’t mean that nothing of note has been happening. In fact, quite the contrary. The little airline that thought it could, is on its way to becoming the successful airline that it should.
There is no doubt that it has been an up-and-down year for the fastjet share price. Just 12 months ago, on 23 May 2014, its share price was at 185.00 before suffering several significant stages of decline that took it, like an out-of-control airplane, twisting and diving toward the ground, before leveling off around the 70.00 pence mark and dropping to as low as 67.50 on 05 January.
The share price took off again on 13 January 2015, one day following the company’s operating report for the previous month that included a 106% increase in passenger generate revenue year-on-year versus December 2013. The airline had carried 66,653 passengers that month, up 75% from the previous year. The share price closed at 142.50 that day, then wobbled about a bit before reaching a YTD high of 116.25 on 12 February.
The general concern for fastjet since its founding in 2012 has not been whether or not success is achievable with its plan for operations in Africa, but whether or not it was adequately funded to do so. That investor angst was largely assuaged when, on 01 April, the company sold five billion shares at a 15% discount, raising £50 million prior to the placing of shares to the public. After a 1/100 split on 21 April, began to ascend again.
On 06 May, CEO Ed Winters proclaimed that, “April was yet another record-breaking month for fastjet and continues our recent trend of reporting significant year-on-year growth in passenger numbers. Carrying over 68,000 passengers is a considerable achievement.” That increase of 90% year-on-year was combined with an impressive 78% increase for the past 12 months and an increase in load factor from 66% to 73%. fastjet’s share price hit 120.50 the following day, 07 May.
Earlier this week (18 May), fastjet announced that it had entered into an agreement with ICBC International Leasing Company Ltd. to add a fourth plane, an Airbus A319-131, to its fleet. This addition will allow the company the dual luxury of adding flights and passenger capacity. The announcement said, “This Aircraft is the first of a number that fastjet is planning to add to its fleet this year, with each additional aircraft able to make up to 1,000 more seats per day available to fastjet’s customers. Based on the 75% load factors currently being projected by fastjet, each aircraft in the fleet is expected to carry approximately 275,000 passengers per annum.”
Winter recently told The African Journalist that the company “Hopes to have up to 34 aircraft operating to 40 destinations within and from Tanzania, Zambia, Zimbabwe, South Africa, Kenya and Uganda by the end of 2018.”
Until recently, fastjet has had a vision without adequate funding. Now it is positioned for takeoff. My advice to you is to invest in a ticket before it does. My advice to fastjet is to use a capital “F” – You’re driving my spell check crazy.
