The Royal Jordanian General Assembly held its ordinary and extraordinary meetings on April 26th at InterContinental Hotel, Amman, presided by RJ Board of Directors Chairman Said Darwazeh.
Attending were Board of Directors members, RJ President/CEO Stefan Pichler, the companies’ general controller, RJ accounts auditors Ernst and Young and some shareholders; the latter, in their entirety, own 92% of the company capital, which amounts to 246.4 million shares.
The ordinary meeting discussed the Board’s report on the 2017 financial results and the business perspectives for 2018, in addition to the auditors’ report, the budget, profits and losses. The ordinary General Assembly agreed to all the articles under discussion.
During the extraordinary meeting, held directly after the ordinary meeting, the shareholders approved the increase of RJ’s authorized capital by 28.2 million shares to become 274.6 million shares. The additional capital increase will be offered through a private placement to the Government’s Contributions Company at a par value of JD1/share with a discount of 610 fils/share, i.e. 390 fils/share. The amendments on the establishment contract and the bylaws of the company were also approved to reflect the mentioned capital increase.
RJ Board of Directors Chairman Said Darwazeh explained that the 28.2 million share capital increase is part of a previously approved plan, assuring that this increase in capital will not lower the number of the shareholders' shares by any means, and the new capital will reflect positively on the airline’s future and improve its financial situation.
In his speech, which was distributed to the shareholders, Darwazeh, presented the financial figures for 2017 and stressed that the company achieved positive results: the net profit before tax of JD468 thousand after a very weak first half year, might not be significant, but which reflects the effectiveness of the turnaround plan towards profitability implemented in the second half of 2017. This net profit is the first positive outcome of the 5-year turnaround plan implemented by RJ.
He highlighted the significance of this result, when compared to the net losses incurred in the first six months of 2017, which amounted JD26.3 million due to commercial challenges and the decrease in ticket prices due to fierce competition, increased capacity in the regional markets and operating costs that grew by 3% because of the 28% rise in fuel prices which could not be compensated in the ticket prices.
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Source: Royal Jordanian