Rocketing fuel bills and austerity in Spain and losses will wipe out profits at the Cameroon Airways Company. Alex Van Elk, the man in charge of the Cameroon Airways and head of the secretive Cameroonian government investment unit at the top of the transport department cannot openly admit that the company had lost over CFA 150 millions because of a botched and sloppy government business strategy.
Camair-co which is the main Cameroon Airlines will find it difficult to reveal to the public and the government when it will drop its bombshell about the losses. It could easily get worse and the final bill could be much higher, Edward Standford an airlines analyst at Oriel Securities said.
Camair-co administration in an unambiguous admission of failure rare in the world of investment in the aviation industry should admit that the business projection and financial analyses were flawed, complex, poorly reviewed, poorly executed and poorly monitored.
Soaring oil prices are taking their toll on the aviation industry, with Camair-co fuel spending likely to hit over CFA 2 billions in 2012. Camair-co investment strategic purchase programme could potentially add to a short-term financial squeeze, sapping more than CFA 500 millions from annual profits.
Camair-co was highly loss-making and had been for some time, said anonymously one of the government strategic adviser on transport. It is important according to the government adviser to restructure very quickly the business.
One of o close lieutenant of the charismatic chief executive, Alex Van Elk, said that the purchase of new aircrafts will allow Camair-co to expand its presence at Yaounde International Nsimalen airport. Industry experts had expected Camair-co to make profits of at least CFA 112.50 millions this year. But the company is losing money even the secretive Alex Van Elk still saying that is going to do his best to make the business full in profit without being optimistic.
But the national company is making huge losses and according to Clement Joscelyne an analyst working for the International Air Transport Association (IATA), the losses at Camair-co are going to be a bit more than we were thinking.
There has been a massive improvement in performance with a poor communication strategy and some better news. However, unpredictable Paul Biya could be forced if the national airlines company is not taking a real step on the road to financial stability to be close to announce a new chief executive.
