Kulula: Party for Mango, but...

Johannesburg - "Yes, we'll hold a party for them, as long as it is a net profit with no creative accounting and without SAA 'freebies' for airline hire and maintenance."

This was the response of Gidon Novick, joint chief executive of Comair, which operates low-cost airline kulula.com and the domestic service of British Airways, to the news that the state-controlled low-cost subsidiary of South African Airways expected to show a profit for the current financial year, the first time since its inception just over two years ago.

The advent of Mango - SAA's counter to the erosion of its market share by kululu.com and 1time - has from the end of 2006 sparked a slanging match between the competitors in the relatively small South African air travel market.

In March 2007 Novick said kulula.com would hold a party for Mango if the newcomer showed a profit within two years.

Mango's chief executive Nico Bezuidenhout told a recent aviation conference in Cape Town that the airline expected to make a profit for the financial year that ends on March 31. He declined to say how big the profit would be, as the month had some way to go, and the figures still had to be audited, but it should be more than R1m.

According to its 2008 annual report, Mango's contribution as a subsidiary of SAA had been a loss of R1m, and in the previous year R61m.

Bezuidenhout has previously commented that the only assistance Mango received from SAA was a R100m loan that it had repaid, and that the airline paid market-related tariffs for aircraft hire and maintenance.

Novick commented that kulula.com would invite some taxpayers along to the party.

- Sake24.com

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