The national carrier Middle East Airlines (MEA) has reported its first net profits in more than 26 years following a long-term restructuring plan and a good tourist season. According to MEA chairman Mohammed Hout, the airline made a net profit of $3 million in 2002, while the final audited results show an operating profit of $8 million last year. Gross revenues in 2002 stood at $250 million. 'We expect higher profits at the end of the year,' says Hout, who ruled out the possibility of privatising the carrier for the time being but conceded there is room for foreign investment.
'We do not expect any privatisation of MEA in 2004, especially under these circumstances in the country. The company is not putting a burden on the government,' Hout says. The government of Prime Minister Rafiq Hariri floated the idea of selling MEA three years ago, when the company was incurring significant losses at the time.
In the past, MEA, which is owned by the central bank, incurred considerable losses due to bad management, overstaffing and the high cost of maintaining offices overseas. In 1998, the bank appointed Hout chairman in an attempt to cut losses. Hout says that he was able to save $27 million a year after management laid off 1,400 surplus employees three years ago in the face of fierce resistance from unions.
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