ICELAND – ANOTHER COOL DEAL FOR THE VANILLA AIRLINE.

ASTRAEUS

COMMERCIAL AIRCRAFT SOURCING AND MANAGEMENT
FEATURE OUTLINE

January 25, 2010.

ICELAND – ANOTHER COOL DEAL FOR THE VANILLA AIRLINE.

When an Astraeus Boeing 757 goes wheels-up on June 12, 2010 en route for Winnipeg via Keflavik in Iceland it will signal the opening of another chapter for the vanilla airline and a management team that’s stayed cool and composed through one of aviation’s most turbulent rides.

Astraeus – the only British airline based at London-Gatwick airport – completely re-generated its business model on May 1, 2008, axing its own scheduled timetable, and stepping out of holiday charter contracts with the major operators.

And the result has been a move from small loss to the sort of significant operational profit that’s enabling cautious growth in a niche market it has carved for itself from nowhere.

The damp-lease trans-Atlantic 757 deal with sister business Iceland Express was negotiated on the same basis as contracts with airlines as diverse as bmi and Saudi Arabian. But Astraeus has been doing a great deal of trans-Atlantic flying of late: one of its aircraft delivered the first British rescue teams to Haiti, and other Astraeus planes have been ferrying Icelandic and Spanish rescuers to the Caribbean island.

“Our entire fleet – bar one ad hoc aircraft - is committed on dry, damp or wet lease to airlines around the world, and we’re sourcing more to address further opportunities,” said Mario Fulgoni, Chief Executive of Astraeus, and whose family did actually run ice cream parlours in South Wales.

“There is huge demand for ongoing contractual work, but we’re also flying a massive amount of emergency operations – not just Haiti, but also military flights, repatriation of illegal immigrants and rescue flights of holidaymakers following airline or tour operator closures.

“The aircraft that come out of lease or contract with our client airlines are immediately in demand elsewhere, but we’ve also established a network, a system and a conveyor belt of sorts that enable us to source and supply aircraft with or without crew, and to deploy resources for emergency cover at very short notice.

“That switch 18 months ago moved us into profit, and we’re now looking at cautious growth – we must be one of the few airlines in the world that has increased its fleet by a net 33% since the start of 2009.

“That takes us to 12 aircraft – but it’s still an increase, and we’re close to signing deals on more aircraft, and providing, flying and managing them for more new customers.

“We transformed ourselves into a vanilla airline – the default colour scheme of our aircraft is white, although our latest acquisition remains blue simply because it has been too busy to be re-painted,” said Mario.

“While our fleet of 737s and 757s, plus an Airbus A320, is largely committed, we do have a vitally-important and in-demand ad hoc aircraft which we have on 24/7 standby for emergency cover for other airlines, for disaster relief, for short-notice government or military flights, or to drop in to a customer fleet ahead of the arrival of a permanent aircraft.

“In making the switch to leasing and aircraft management we also switched the business into an immediate operational profit – and we shortly expect to confirm an annual profit from the re-modelling of our business.”

Astraeus offers wet, damp and dry leasing - arrangements varying in package between a fully-crewed and operationally prepared aircraft ready for service (wet lease), through providing a partially crewed aircraft with the customer providing part of the flight or cabin crew, or other support elements (damp lease), through to just the aircraft (dry lease).

The aircraft are leased by clients according to seasonal demand, or to start up new routes, to address changing demand - up or down - on existing routes, or to alter or improve the financial viability of a particular route by changing the type of aircraft.

One of the Boeing 757 captains is Bruce Dickinson, who is also lead singer with Iron Maiden, winner of the best live act award at The Brits, 2009. When on tour, the band uses an Iron Maiden-branded Astraeus Boeing 757 – “the Combi”, with a split cabin featuring 75 seats and space for seven tonnes of cargo - which Bruce occasionally captains between gigs. It’s called Ed Force One – “Eddie” being the name of Maiden’s mascot.

UK-based Astraeus commenced operations in 2002, employs 250 people and operates a fleet of eleven Boeing 737 and 757 aircraft and one Airbus A320, primarily on contract with a variety of airlines. Astraeus has a worldwide Air Operator’s Certificate (AOC) and is IOSA accredited. Astraeus is a wholly-owned subsidiary of Eignarhaldsfelagid Fengur HF which also owns Iceland Express.

Ends

Further information:
Iain Macauley
+44 (0)7788 978800 / im@pressrelations.co.uk / www.flystar.com