Jazeera Airways K.S.C.P. (JAZEERA) Earnings Call Transcript & Summary

Hello, everyone, and welcome to Al Jazeera's 4Q 2025 Conference Call. My name is Nada Amin. I'm part of EFG's Consumer and Retail team, and it's my pleasure to welcome the company's CEO, Barathan Pasupathi; the company's CFO, Krishnan Balakrishnan. They'll begin with the presentation and then we'll open the floor for Q&A. Please go ahead. The floor is yours.

Thank you, Nada. Good afternoon, investors, analysts, partners and team members on the call today. Thank you for joining me and Krishnan Balakrishnan, our Deputy CEO and CFO, as we unpack what has been an amazing 2025, a very busy year but with stunning records. But before we do that, please indulge me in wearing my favorite Al Qadsiah jersey in Kuwait and to also showcase this slide here with Al Qadsiah winning the Super Cup in Kuwait. We are title sponsors for Al Qadsiah. And since we have won a Super Cup in Kuwait and since we are announcing super results in 4Q '25 and full year '25, I've decided to dawn the yellow jerseys of Qadsiah, which is Watan in Kuwait. Now let me roll forward to what has been a very, very busy year. Before we start, I think earlier today, we have disclosed to the Kuwait stock market and a press release of Jazeera Airways reporting record profit results at KWD 21.8 million for full year of 2025. This result has been achieved through a very tough year, geopolitical [Technical Difficulty]. But before we unpack -- before I unpack the financials with Krishnan Balakrishnan, our CFO and Deputy CEO, let me just give you a couple of highlights as we came into celebrating 20 years of flying in Jazeera Airways. As I have covered, we became main sponsors and official carrier of one of Kuwait's most celebrated sports institution, the Al Qadsiah Football Club. For some of you who already may know this, Al Qadsiah Football Club was actually formed in 1972 in Kuwait. It is a 74-year-old club in Kuwait -- 1952, I'm sorry, a 74-year-old club in Kuwait with a huge following and fan base. Many in Kuwait see this with national pride and we are delighted to be proud sponsors this year and we are delighted that in the inaugural year of sponsorship, they have won the Super Cup. Rolling forward, we have had a very busy, busy 2025. Jazeera Airways successfully launched a number of destinations this year. Abha in Saudi Arabia, Abu Dhabi and Al Ain in the UAE, Budapest in Europe, Hurghada in Egypt, Sochi in Russia and Yerevan in Armenia. Every single destination that we have launched this year has been met with huge demand. And we are so confident from the 700,000 summer seats that we offered last year that we'll be putting in place close to 1 million summer seats this year with more destinations to be announced shortly on top of what we've already announced with Milan Bergamo Airport. We have also restored in 2025 after 13 years of absence, direct air connectivity to Damascus, Syria. Our flights have been doing stunningly well. And we are so confident with the Syrian market that we are actually looking into Aleppo operations sometime in June this year. The super results in 2025 were followed with a very super announcement at the tail end of 2025. In December 2025, GACA, the Kingdom of Saudi Arabia General Authority of Civil Aviation, awarded Jazeera Airways a national nonscheduled charter air carrier tender license. This is phenomenal. If you just play back population of 5.1 million in Kuwait with growth of almost 5 million in passenger numbers with 23 aircraft and just follow that through with the Kingdom of Saudi Arabia with a population of 37 million with deep investitures in religious market, in tourism market, in destination attractiveness, we are very bullish on Jazeera Saudi. We will cover that later in the call and through the Q&A, where I'm sure all of you around the table would have a few questions for us. But generally, this is a new win of growth lever for Jazeera Airways and this bolts on to what we have done in the 5-year strategy in terms of growing our ancillary revenues, showing cost discipline that we've done, growing the networks and growing load factors. This license in Saudi Arabia is a huge win for Jazeera Airways and this will set us strongly for the next 20 years in front of us as we have successfully covered the last 20 years. We have also, in the year, done quite a number amazing operational economic changes. I do recall 3 years ago, when I landed in Kuwait and told everyone on the call that we will leave no stone unturned in terms of looking for the lowest cost DNA in the business. We are now proud to announce that we will be the world's first low-cost airline operating a narrowbody with the world's lightest Expliseats. The TiSeat 2 has now been implemented and launched on 2 of the aircraft in Jazeera Airways with a third in the hangar. By the summer of 2026, all aircrafts in the fleet will have a seat density of 180 across the network. So the seat densification program has actually allowed Jazeera Airways to produce another 1.5 to 2 aircraft more compared to what it was 3 years ago with the same cost base. Following that, we have also now built an impressive building. The operational support building is one of the state-of-the-art modern building that Kuwait has seen in the last 40 years being built in the ramp. And today, we proudly moved 4 CFM LEAP-1A engines into the building and commissioned the building. This building will also serve as a wheels and brake shop, basic flight maintenance for the aircraft and house all the engineering teams that we need across the business to run the network in Kuwait in the Kuwait hub. And we are now gearing towards building the hangars in Kuwait. On the right extreme, you'll see a picture of the Lord Mayor of U.K.'s visit in Singapore, commissioning the Jazeera simulator building at our own Jazeera campus. Lord Mayor Iain McNicol there is followed together with our Chairman, Mr. Marwan Boodai and the U.K. ambassador to Kuwait, His Excellency Qudsi Rasheed. So you can see that whatever we are committed to doing in the last 3 years, we are executing to plan and very importantly, executing to strategy. Another bonus that we have seen in the last second half of 2025, which we are positively projecting into 2026 and beyond the next 5 years is New Kuwait. As you know, the Amir, His Highness has commissioned a blueprint for Vision 2035 in Kuwait in terms of opening up Kuwait. And in this stream, one of the main engines for growth is aviation. We are now working with government stakeholders, including Visit Kuwait to develop the tourism sector in Kuwait. Early start, early days, but we are seeing some very good partnership across government, across stakeholders, across the airports and the regulators. We believe that this will be a silver lining in the clouds for the next number of years in Jazeera as we grow directional traffic. One of the key questions that we have continuously -- Krishnan and I have continuously taken on board on investor call is the directional weakness of outbound peaks and inbound traffic into Kuwait. This addresses it. Together with this, Jazeera will also launch Jazeera Holidays, a product that will be building inbound tourism into Kuwait as well as across the network and we'll explain more in the Q&A. Last but not least, fundamentally, the #1 license for growth at Jazeera is safety, safety, safety. Safety first, safety always. In this strong discipline, we have actually organized Kuwait's first Aviation International Forum where more than 150 participants took part in Kuwait's first forum and more than 70 participants from Boeing, Airbus, CFM, Embraer and many aviation suppliers and manufacturers joined us with a common topic on safety with a key topic of flying in conflict zones, which is one of the fundamental challenges that all Middle Eastern carriers face in the Middle East and especially to what's happening in the geopolitics in the world. So we have a beautiful 2025. We have commemorated 20 years of flying in great fashion and style. And now we are programmed and well positioned for the next 20 years. So let me get to the agenda proper. I'll give you operational highlights and Krishnan will likewise cover the financial details on everything from ground handling cost to engineering cost to any single question you have on the financial aspects of the business. 4Q '25, we saw almost 5% growth in passenger numbers. Now you have to take into account this was not any ordinary quarter. This was a quarter challenged with geopolitics. This was also a challenged -- this is a quarter challenged with weather. We experienced quite distressful weather conditions, including fog in many parts of the Middle East, but we delivered a 4.9% passenger growth. 4Q '24 had 1.24 million passengers and we delivered 1.3 million passengers in Q4 of '25. Load factors were stunningly high at 80.8%. Now what happened in the 12-day war is that load factors sunk for carriers globally and carriers mainly in the Middle East. Jazeera recovered that to end the year at almost 77% load factor in a very challenged year. Impressively, we pushed on utilization. Utilization grew at 7.5% at 12.7 hours and this is in the right quadrant of A320 operators in the Airbus fleet. Yield was marginally down at 0.15 as we balance between loads and yields, but overall RASK grew by 2.2% and that fundamentally is important to us. Also on the cost streams, things were moving in the right direction. CASK was down 4.4% and CASK, excluding fuel, was down by 1.6%. Now why did CASK reduce by 4.4% and you'll see that a similar trend for the full year. This is how we executed Project Falcon in December of 2024, playing out for the full year of 2025 and we have a lot more cost initiatives in play in 2026. For the full year, passenger numbers grew respectfully by 2.2% to nudge for the first time ever above 5 million. Now our estimates are, if not for the 3-month weakness we saw on the 12-day in the India Pakistan war, these numbers will be north of 10% growth. Load factors were marginally different from 2024 on the back of the challenges we had in 2025. But you've seen what we have done in Q4. This was a system-wide load factor for the full year. But in Q4 alone, we got back into 80.5% and we are holding very strong load factors early in the start of 2026. Utilization for the year grew at 2.3% relative to '24 and yield was up 2.3%, while RASK was down 2.6%. The drop in RASK we faced was a combination of 2 factors. One, we have increased ASK count by increasing the number of seats in the aircraft. Two is the impact of the 12-day war and the Indian and Pakistan war. If you take out the war, we are very positive that RASK would actually have grown for the full year. However, on balance, CASK has gone down by 6% for the full year. CASK, excluding fuel, has gone down by 2.6%. For the analysts who are following the price of fuel, I think you've seen '24 and '25 variations in fuel getting into a more favorable environment. Putting aside geopolitics, 2026 is equally looking favorable. 4Q financial headlines. Revenue grew at 3.3%. Operating profits impressively grew at 85.9% and net profits grew at 69.7% for the quarter. This is only for the quarter. But if you overlay the full year, revenue grew by almost 5% in a year where we had 1 less aircraft. In a year where we were challenged by 2 wars, in a year where it was really not normal relative to 2024. That was an impressive performance by the team and there's a number of reasons behind it. One, we implemented an AI tool [ camba ] across revenue management. What used to be a cookie-cutter fixed fare approach on revenue management is now very sophisticated in Jazeera. Two, we have implemented fare classes across the various segments and we are building a B2C platform that will be launched in March 2026. And we have a number of surprises, positive surprises in 2026, where you'll see that Jazeera will be pushing on owning more B2C customers. Overall, the team did very well in 2025 in terms of delivering $218.1 million of revenue across not only the new markets, but across the number of sectors we operated across the network. If you see, we have been the busiest airline in Kuwait with 37,351 aircraft movements. No other airline has come close to Jazeera in 2025 in terms of operating that many sectors in Kuwait. Now operating profits were at 50.7%. You'll see that we developed quite well in terms of contribution margin in the DTL P&L and net profit grew a staggering 113.7%. Now net profit in 2024 was $10.2 million. Of course, it was also a year that was challenged by coming back on a very weak Q4 of '23. Jazeera put in place many initiatives to improve 2024 and now we have doubled the profit in 2025. Ancillary, if you recall, as part of our key strategy, we had low-cost DNA, we had seat densification. We had ancillary as a pillar to chase. And of course, I've covered the additional pillar we saw in Jazeera Saudi that will be covered later in the Q&A. But in ancillary, if you have seen what we've done, already looking at growth numbers in '24 relative to '23. On top of that, Jazeera grew total ancillary revenue by 45.5% in 2025 relative to '24. How did we do that? There are a number of programs that the team implemented. You've seen cancel for any reason, insurance program that's very popular with our market during leisure travel. You've seen bundles, you've seen seat selection, you've seen baggage. Now we're going to replicate that in a very big way in 2026 with the new tools that we'll be having with the modernization and the transformation of the website. So stay in tune for that. In terms of per passenger ancillary revenue, 2024 actually grew almost 20% to 30% relative to '23. And we then added almost a 40% growth in per passenger numbers in 2025. These are stunningly great numbers. If you look at the trajectory that we have provided you on the 5-year path, you'll see that we are actually achieving ahead of some of the targets we set ourselves. We will continue building ancillary as a key pillar and stream for Jazeera Airways. As you have seen the per passenger number for full year 2025 at 5.8 million -- KWD 5.8 per passenger, that is impressive. That compares with KWD 4.4 in 2024 and was less than KWD 4 in 2023. So you see the growth at the full year at 35% and the growth in the fourth quarter showing the momentum that we have seen quarter-on-quarter going into '26, you're looking at a very impressive 2026 in ancillary revenue performance. Market share. I just covered that we have 37,351 aircraft movements in the year. Yes, competitors in our market have been taking delivery of wider widebodies, but they're not really very far from us in terms of market share. If you look at market share, we have 30.3% in Kuwait. Now that is marginally lower than 2024. That's relative to what we experienced during the year, especially between the 15th of May to August during the warring period and during where people actually chose to stay home relative to going out and travel. So once we came after the August belt, you see load factors pick up in Q4. We are confident that in Q4, with the program we have in place, with the 1 million seats we launched in summer and with the high rotations and utilizations that we program in the system, we'll get back to more than 30.5% to 31% of load factors in '26. The passenger distribution has been similar, almost similar between '24 to '25. But you've seen us add more Egyptian markets, the most viable markets for Jazeera Airways in terms of stage length, in terms of performance. You've seen us also grow other markets, including -- I covered some of those, including Sochi in Russia, Yerevan, Armenia. So we will be continuing to grow the network. But very interestingly, in 2026, we also adopt the approach of diversifying the flying westbound. Operational performance. If you look at destinations in 2025, we added 8 more destinations compared to the summer of 2024 and I've covered some of those in the start of the presentation. But what's really interesting is I want to cover -- touch on Abu Dhabi and Al Ain. Many airlines have started -- wanted to start operating to Al Ain, but Jazeera has made it such a success that we grew our Abu Dhabi and Al Ain services to a daily service between the 2 points. What started 2 services in Abu Dhabi is now 4. And with the way we are engaging with the DCT, Department of Culture and Tourism in Abu Dhabi, with Abu Dhabi airports, with [ Valero ], the ground handlers and very importantly, with the ambassador in Kuwait, we are looking at increasing our flying into Abu Dhabi. It is a impressive destination. It's a destination that has shown how to engage stakeholders on many fronts, not only destination attractiveness, but providing operators with the lowest cost base to keep operations sustainable and viable to grow. So we're very pleased with our Abu Dhabi and Al Ain experiment. And hence, we have started a number of markets, including Milan Bergamo Airport on the same context. Damascus, which we launched in the middle of 2025 has been hugely successful. And this summer, it's going to be a rock star performance. Sochi, Yerevan, Abha, Hurghada, these are markets that have shown to us that Kuwait lacks direct point-to-point traffic. Today, the general population in Kuwait, if they are going northbound or westbound, have to actually mostly go down south to a hub and then connect north again. So by putting direct point-to-point traffic into the network and growing points direct from Kuwait, we have successfully moved the Kuwait market into these destinations with very healthy load factors. What's really interesting is Kuwait commissioned the third runway in October of 2025. Now Kuwait as a country has 3 amazing runways and building terminal capacity and we believe that Kuwait will need close to 60 million terminal capacity in 5 years. And hence, we are very bullish on expanding on Terminal 5 and also building on Terminal 6. I will now pass the T5 announcements and enhancements to Krishnan. Krishnan?

Thank you, Bara. So good afternoon to everybody. On the T5 side, as you know, we have not yet got the approvals for expanding the current terminal. However, within the terminal, we have been working on enhancements, changes to make sure that we are able to accommodate more passengers with the same capacity. A few of the highlights of what we have done and we are in the process of further doing are increasing the number of seats available in the halls, waiting halls. So we have gone up to 1,200, which is an increase of 33%. Additionally, we are working on adding another 100-plus seats and creating a new gate. Today, we have 6 gates. Earlier, we used to have 5. It's gone up to 6 and we are working on the seventh gate. The business lounge capacity has gone up to 72. Now actually, we have expanded this further. We have increased, within the next month, you will have additionally about 40 more seats in the business lounge. The retail outlets are being aggressively taken by various tenants and we are increasing the revenue also from the retail lease income. The number of facilities, the toilet facilities have multiplied. There was an area in the arrivals where we were short of capacity toilets-wise. Now that is also being addressed. And in the next couple of weeks, we will have additional toilet facilities in the arrivals also. The smoking rooms, currently, we have 3, which we expanded during the course of this year, we added 2. Now the fourth one is also being developed as we speak. The immigration queuing capacity has increased with the new queuing system. And the number of kiosks check-ins have multiplied over the year. Now on average, 2,320 was the highest which we achieved, in fact, in 2025 in 1 month. In January, I'm very happy to announce that we have 4,500 kiosk check-ins. So this is increasing as we speak and we are investing further in adding more kiosk machines in the terminal to facilitate the passenger check-ins. And moving on to the next slide on the financials for the fourth quarter, the KPIs. Bara has touched upon most of these, but I just want to add a couple of points. One, despite the reduction in capacity compared to the fourth quarter of 2024 in terms of aircraft, we actually increased the seats, as Bara mentioned, we have densified the aircraft and we fly 174 seats on each aircraft. So as a result, we increased the seat capacity by 3.1%. Obviously, with the higher load factors, the higher passenger numbers and also the number of sectors and [indiscernible] and the utilization all going up in the right direction in the comparison of fourth quarter '25 versus fourth quarter '24. As a result, I will take you to the next slide, our revenues went up by 3.3%, mainly because of the increased capacity and the higher load factors that we experienced and the passenger numbers. The operating expenses were 3% lower compared to the previous year's same quarter, mainly driven by the cost efficiencies that we managed to achieve year-on-year. And as Bara mentioned earlier, we have been focused on making sure that our unit costs are always kept under control. That has helped us to improve the bottom line and keep the costs below the last year's level despite the operations being more. Of course, the ownership of the aircraft was one of the contributors and the fuel price also did not work against us. The operating profit as a result improved by 86% compared to the previous year same quarter. The net loss for the quarter reduced by about 70% as a result of all the actions that we took. This being the lowest quarter for us in the year, we actually performed much better than the last year. In terms of the assets, we have a steady, very strong cash flow. The balance of cash as of 31st of December '25 was slightly higher than the cash balance as of '24 December 31. Now mind you, this was mainly because of the strong operational performance. And this balance has been maintained despite us paying Airbus the advances for our aircraft order during the course of the year and also paying back aggressively the term loans. As you will see, the term loans have reduced year-on-year by a strong number. Despite that, our cash balance remains very strong at KWD 49 million. The fixed assets, of course, the movement is primarily because we have paid the advances to Airbus as well as the [ wrotables ] being regrouped and shown as an asset instead of being inventory. So from current, it has moved to fixed assets. The liabilities reduced because of one aircraft being taken out of the fleet due to an [ early ] delivery and of course, the repayment of loans that I mentioned earlier about. Now thank you for the -- for my bit. Bara, I request you to please talk about the outlook for FY '26.

Thank you, Krishnan. And as you've heard from Krishnan, we have a very solid liquidity position as well as core strength in the balance sheet position regardless of the fact that we have been paying quite a fair bit of equity into aircraft purchases, including the 6 aircraft we bought in Q4 of 2024 and as well as the PDPs for the growth aircraft that will be delivered in Jazeera from October of 2026. Now in terms of outlook, if you look at my commentary earlier today, you'll hear that FY '26 has started on a strong note at Jazeera Airways and in fact, for Kuwait and the market, the whole GCC market as a whole. I think carriers across the Gulf and including Kuwait are enjoying a small period of what we have seen as geopolitical stability. We hope this geopolitical stability will continue forward, but things are actually looking quite positive. Now I'll start off by talking about the Saudi Arabia GACA license. Population of 37 million in the Kingdom, population of 5.1 million in Kuwait. If you just apply the multiplier effect and the opportunities we have in the Saudi Arabian market is enormous. Today, at Jazeera Airways, even without having a hub operation in Saudi Arabia, we do phenomenally well. We have to thank the Kingdom, the stakeholders in the Kingdom, GACA and key stakeholders in GACA for supporting Jazeera Airways since our first flights into Saudi Arabia to have almost close to 100 flights a week today without a hub in Saudi Arabia. Now what does this Saudi GACA license mean for us? It now allows Jazeera Airways to look at the overall network and to look at commonalities where we operate and to bring in inbound flights into Saudi Arabia on a B2B basis and also look at leveraging the core strengths we have in the network on optimizing long-range flying into direct fly from the Kingdom. Without giving away much, we believe that this is a new era of growth for Jazeera. We believe the opportunity that the Kingdom and GACA has given us is enormous and we will ensure that we start in the right way with the right aircraft and the right markets. Plans are underway, and Krishnan is looking after this portfolio of businesses. And we have team members already on the ground in Saudi Arabia, working with stakeholders to make this happen this year. The seat densification program, I covered that and you heard from Krishnan, by 2Q of 2026, we will have all the fleet at Jazeera Airways with 180 seats across the network. This is a seat standardization program that we started 2 years ago and we will successfully implement this this year. Self-handling of ground operations, this is, again, another opportunity of keeping margins in-house versus giving margins away. But more importantly than margins, we will be able to cover and contain and control end-to-end customer experience from ticket to tarmac. As you know, Jazeera owns and operates Terminal 5. And now by extension of the terminal and doing ground handling services, we will be able to control the whole customer and passenger experience across the terminal from the moment the customer takes a first step into the terminal to the point they check in into our terminal to when they get into security, when they sit into our lounges, when they get into the aircraft and the aircraft is pushed back, it will be Jazeera, Jazeera, Jazeera. It will be the same commonality of high standards of service and reliability that we will be able to execute at the same time with great commercial opportunity as well. So that will be completed by second quarter of '26 -- by the first quarter of [ '25 ]. Now let me talk about low-cost DNA and Amman City Airport. If you have seen lately, we have published that we were the first operators into what was the Marka military Airport before in Amman to start it as Amman City Airport. We inked an agreement with the airport authorities on the 28th of December and became the first operators to fly physically into the airport and land on the runway on the 1st of February 2026. This airport is in the heart of Amman. I landed on the very same day and I took off on the second Jazeera flight. Both flights departing out of Amman were full. Were full, I repeat. Why? Amman City Airport is only 12 kilometers to the city center relative to the former airport we used to operate at a distance of almost 34 to 35 kilometers. The kind of customer convenience, passenger convenience the airport gives the customer has been met by impressive demand. And we are very bullish on summer of 2026 as we think this summer, we will be able to pivot more capacity into Amman City Airport. Travel outlook. We touched on Visit Kuwait facilitation and visa process. There's a lot of improvements being made in Kuwait. We believe the whole biometric program has been implemented. We are working with MOI. We are working with government stakeholders and the DGCA to improve passenger experience and convenience at the terminal, namely in Terminal 5 as well. So there, this year, we'll roll out a number of initiatives and we are very pleased and confident that come summer this year, we'll be able to give the customers a better experience. Already, you've seen the more than a dozen improvements that Krishnan has covered in the terminals, but this visit visa facilitation process will further fuel growth directionally into Kuwait. We covered Kuwait Airport launching the new control tower and the third runway. This now gives Jazeera another added wing for growth. We are now looking at more direct connectivity point-to-point from Kuwait to markets and engaging government stakeholders from both Kuwait and importantly, from points that are not covered from Kuwait, even after 60 years of bilateral ties. So we're working very closely with the government affairs team to kind of ink bilateral agreements with almost 55 different markets to look at increasing capacity just as is done by a 50% increase in India last year. So this is a big game strategy for Jazeera. This is something that will set Jazeera up for growth on top of Jazeera Saudi. Oil prices. Oil prices have been a tailwind for the business. Interestingly, in 2025, all airlines benefited from the current glut in the oil markets to see oil prices drop between $5 to $7. We've already seen a further drop in the late part of 2025 and very early in 2026. And we believe that if prices continue to remain at this level, it is going to be an attractive point to go in to hedge. Airlines who have hedged in the middle of 2025 to straight collars or plain vanilla swaps are obviously in a different position. At Jazeera, we took the view that given geopolitics and given the Trump administration philosophy in terms of both the dollar and oil, we anticipated oil to be neutral -- to be neutral or even take a downturn in terms of pricing. So we are watching this very carefully. We believe with both where the dollar is and oil is, both will be tailwinds for the business. Again, let me end with the geopolitical climate. It's uncertain. But if you've seen what we have done in 2025, regardless of the 2 wars in the network, the business in Jazeera is resilient. Kuwait is resilient. We believe that notwithstanding the challenges you've seen in the Iran FAR, we still operate to Iran, we have only marginally canceled a few flights. It has not affected the network. Iran keeps to be -- Iran remains open to Jazeera and Jazeera is open to flying into Iran. We have successfully launched operations even during difficult times with, of course, safety being the paramount importance and ensuring that all our flights in Iran are able to land safely and depart safely with the highest operating standards. So on the basis, the outlook for 2026 is positive compared to even 2025. So with that, I want to take a moment to thank, of course, the investors and analysts on the call, those who are here and those who cannot be here. But very importantly, I'd like to take this moment to address a huge note of thank you to the leadership, to the people and the teams at Jazeera Airways on pulling off a super, super year in 2025 and delivering what has been the record year in Jazeera's history. With that note, we are very confident that with the type of leadership and the people and the resilient team members we have, 2026 is going to be equally successful. But more importantly, the next 20 years are set up right for Jazeera Airways. With that, I hand it over to Nada for the Q&A.

[Operator Instructions] We already have a couple of questions in the chat box. So I'll start off with those if you'll allow me. I'll read them off one at a time. Some you've already touched on, so feel free to just address if you have any additional comments, please. The first set comes from [ Ali Aidel ]. He says, congrats on the results. Can you give more color on KSA operations? What are your targets for the first year and destinations you're targeting? The second question he asks is, can you give an update on the in-house ground handling after [ NAS ] exited Kuwait? And his third question is, can you explain what is the issue with getting the approvals for T5 expansion and would this be the case also for T6? I'll pause here and I'll continue once you've addressed those.

Well, in soccer terminology, that's called a hattrick, 3 questions in a row. So let me address the 3 questions briefly. I think on KSA, we kind of touched on it. And great questions. I think the fundamental approach in any AOC is to make sure that you're governance-centric, you obtain the license, you get the blessings of the regulators and then you start the mission. But we already have huge, I would say, huge demand on the table from our current operators in the markets who have been with us on B2B businesses. And these stretch across Bangladesh, India, Egypt, now Syria as well as Europe and of course, Kuwait and the wider [indiscernible]. So we have actually -- even before flying, our teams have to put off demand on hold to say that, yes, I think all this business has to be funneled to Kuwait for the time being and then we'll address Saudi Arabia. The markets, I think if you look at markets, interestingly, if you look at the haj and umrah markets, congratulate -- I mean, we have to applaud what the Kingdom and the authorities have done there with the systems and processes. We have made it very seamless in terms of visa processes. West Africa is open to us now. North Africa was always open to us. Markets across the CIS where we have distribution platforms are fully open to us. And let's not forget, we have been one of the largest operators from Russia into the Kingdom. So all those businesses that we currently do will continue into the Kingdom as it's coming into Kuwait. But the new geographical location of the business will add us further west. It gives Jazeera further reach to the west and that's going to be a very interesting proposition for the Kingdom. We will -- at a certain time, certain stage when the project takes alive by itself, we will cover that more on the calls. I anticipate sometime in the 3Q call. I think the 2Q call will be a bit too early. That's number one. The update on ground handling. Look, I think it is no surprises to anyone, Menzies and us. I have to say, I have to put on record, they have been brilliant partners for Jazeera Airways over the last 20 years. If anything, we are very appreciative of the service and the high standards of reliable operation and partnership that we have experienced from both Menzies and NAS. For no control of our own or no doing of our own, they are out of the market. And Jazeera Airways, we never leave our destiny to the chance of anything and we have taken that in-house. As I speak, we have 40 buses in China on their route to Kuwait. We have got almost KWD 4 million to KWD 5 million of equipment in the air side. We have hired manpower with expertise on turnaround coordinators, safety regulators, pushback drivers. We have done the whole project in-house. And we have actually been serving our customers above the wing in the terminal and the check-in counters, we've been doing that. Now we believe that once this is done, we are only months away from fully mobilizing our teams to fully resourcing and supporting Jazeera Airways in-house. But meanwhile, we have made ancillary arrangements, support arrangements. So not a single flight has been canceled at Jazeera Airways. In fact, we are operating at very high on-time performance metrics even today at Jazeera. On T5 and T6, look, I think the T5 delay is more administrative than anything. We made a couple of proposals to change the layout of the direction of traffic in terms of a 2-way road to 1-way road. Obviously, that doesn't only include us, it includes other stakeholders, government stakeholders who are on the same road as well. So this is only a delay. I won't read too much in it. If anything, look on the positive, we have built out the [ SIM ], we built out the [ OSB ], we're building the SIM. We have got the hangar approvals. Everything is coming its way. Yes, it takes a bit of time in Kuwait, but you have to applaud the authorities. They do their own due diligence and they come back to us, but things are moving. Thank you. And that also applies for T6. We are not letting go on T6. Let me tell you why. As a country, today on 2 runways, Dubai does 92 million. Singapore on 2 runways does 72 million passenger traffic. Kuwait on 3 runways only does 15 million of passenger traffic. This country, I would say, this beautiful country of Kuwait, which I call home at the moment, is the pearl of the GCC in terms of geographic location. A stone's throw away from Iran, northbound easiest point to go access northbound. If you've seen my LinkedIn article yesterday, I have even what do you call it, [indiscernible] Singapore Airlines to fly into Kuwait, given the Kuwait Airways and Jazeera Airways network. So we are very bullish on Kuwait as a market and the regulators and the government see that and hence, they built out T3. T2 is going to be ready in 2 or 3 years and hence, T6 is much needed and the authorities and regulators know that it's good to have a public company running a national carrier as well as a private airline running a national carrier because competition is good for the country as a whole. Thank you.

So one last question from Aidel is given last year's issues with LEAP-1A engine, how did this impact operations? And does this issue -- and has this issue been resolved by CFM?

Another great question. Look, the LEAP-1A engine is not only an issue at Jazeera Airways. I think it's globally almost take a account, 440, Krishnan, or 450?

Yes.

Yes. Around north of 400 engines are actually what you call it, need to be fixed. Now Jazeera Airways has taken the proactive approach of investing its own capital with the foresight of management and leadership earlier as well as the chairman and the Board to buy close to 6 engines and to have them on hand. This is over and above of maintenance requirements. We have not been impacted in a way other carriers are impacted. But yes, we have been impacted in the way that I'm not pleased our numbers are only at 5 million. I was bullish our numbers could actually be around 5.3 million to 5.5 million passenger numbers in 2025. However, having said that, just like Menzies and us, CFM have been absolutely great partners for Jazeera Airways from the onset of the CFM56B. And then we were the first adopters of the LEAP-1A engine the whole of Middle East. I can tell you from the leadership team, the operational team and the sales team at Jazeera, we have an outstanding relationship with CFM and we have built on that very importantly because we need them for Jazeera Saudi as well. So it's an amazing engine. Yes, airlines across the GCC, especially in harsh environments and sand environments have time on wing issues, both on the 320neos and the 321neos with the higher thrust. But at Jazeera, we love the aircraft, we love the engines and we'll work with CFM to ensure that we will have an AOG-free summer in 2026. Thank you.

The next set of questions is from [ Anateli ]. They're mostly regarding the delivery of aircrafts. So regarding the -- the first one is, can you provide an update on the aircraft delivery scheduled to begin in '26? Regarding the 4 aircraft scheduled for this year, can you confirm the exact delivery scheduled or the monthly timing for each aircraft? The second question is how does the company plan to handle the aircraft to be delivered? And do you intend to finance -- the third is do you intend to finance these aircrafts fully on balance sheet? Or will you pursue a sale and leaseback structure with long-term lease agreements? And then depending on that, I'll follow up with some questions.

Again, that's another hattrick as well, 3 questions in one go, but good ones. Look, I think in terms of delivery schedule, we can confirm now we will have 2 aircraft delivered this year. We are pressing for those to be delivered in the fourth quarter of this year. But we pleasantly placed for some surprises in summer of this year because we believe that the market in Kuwait will need some temporary capacity before our growth aircraft comes. In fact, we are very pleased that these 2 aircrafts that will come in Q4 of this year will be part of the order book of the growth aircraft we have in place. So we have no issues in terms of capacity, in terms of how markets are opening up and the way we have the right aircraft, the right aircraft, right market at the right time. So we are happy with the delivery platform we have, while we fix the basics in the business and getting the website right, hangars built 8 years done, okay? In terms of debt and equity funding and whether we onboard aircraft on our balance sheet or do straight leases, we are very open to all instruments. But at the same time, I'd like to highlight and this is for the analysts to conquer and think why did Jazeera buy back 6 units in 4Q of '25 -- '24? Because we want to retain the margins. When you have your own liquidity WACC cost below that of borrowing costs, obviously, it makes sense for us to take aircraft on our books. And hence, we are very open in terms of looking at both. Now from a treasury point of view, for those on the call on treasury management, you'll know that it's a very interesting volatile period with the dollar. Of course, aircraft purchases are in dollar, dollar-denominated and the KWD is relatively stable with the dollar. So it's giving us -- and with our so-called huge liquidity pipeline in Kuwait, both on the current lines we have and lines that others want to give us, given that Jazeera is a blue-chip company on the stock market here, we have no issues with liquidity. But the question is a good one and we'll get closer to answer the question because we are not really thrilled on sales and leaseback. We don't need to do this. We don't need to maximize -- we don't need to be opportunistic to get profits upfront and then you get the pain of high lease rentals. So we have a very disciplined program and governance framework and will be guided by Krishnan's recommendation to the Board. And the way we are looking at it, we have lined up some attractive financing propositions already. If you look at the 8 aircraft between '26 and '27, you're looking at -- look, if I give you a list price of [ $70 ], we're looking at $700 million of funding at 80% debt-to-equity levels. Look, it's stuff that we've done before in a bigger scale. At Jazeera, we're well equipped to fund those aircraft even at those list prices without giving away commercial agreements. Thank you.

We still have a couple of more questions. So just let me know if you have time for a few more as I go through them. There's one from [ Muhammad ] on LTV. He asks, capital of $22 million is a little bit low for Jazeera operation. Any thoughts of increasing capital, especially as Jazeera Airways keeps expanding?

Yes. I think it's a great question. If you recall from the days of COVID, when COVID happens, this is also a boardroom discussion at Jazeera to kind of highlight to you how governance-sensitive and fiscal disciplined the Board is. Look, we know what's our operational cash requirements in the business. Yes, you've seen the 85 fils of dividends we have to pay. That's programmed for payment with consideration of the CapEx that we have to invest with the operational flow of funds. You've seen Krishnan talk about the flow of funds into the business. They have been healthy. In fact, last year, we took a hit during summer. This year, we think we will have another KWD 8 million to KWD 9 million or KWD 10 million more in terms of collections to what was last year because that's what we lost in summer. We lost between KWD 8 million to KWD 10 million of revenue because of the system-wide network shutdown from the 2 wars. If you project that, our performance would have been another -- with a contribution margin of 40%, we should be north of KWD 3.6 million of performance on the EBIT level or PBT level. Put that aside. Now in terms of, yes, you can say the liquidity or the retained earnings and share equity levels is low. However, if you recall Jazeera Airways, I've known Jazeera Airways from the early days from the start and the CFO, there's no issues in terms of bringing capital to the table. I can tell you that. But this is an issue for the shareholders to consider. And as leadership, we don't indulge in discussions. We make the recommendations. And from where I sit together with Krishnan as copilot is we have no issue in terms of raising liquidity from our own sources, no issues on raising liquidity from financial institutions who are actually knocking on our doors to borrow, but we are saying no. In fact, you've seen what we've done. In 2025, the discipline we have paid back quite a fair bit of loans to be where we are. And the third thing, in terms of having more equity, not an issue. But again, it's not for me to comment, it's for the shareholders to comment. And if you see what the shareholders are actually doing in the market, I'll leave it to your imagination. Thank you.

The next question is from [ Osama Khan ]. He asks, can you please share your outlook on the engine delivery delays?

It's not really engine delivery delays. It's -- we are not impacted, Osama. It's a good question. I think a lot of airlines, I think you probably heard -- I think it's on both sides of the aisle, right? You have one side is CFM and the other one is IAE or Pratt & Whitney. Both sides have a issue. But listen, we are not impacted. As I've already commented, we have a fantastic relationship with CFM and Safran. We've been the first adopters and embracers of the engine in this part of the world. We have been operating on a position of strength with this half a dozen additional engines that we have on our books on our own on top of what you need a spare engine requirements to operate. So we have no issues, no engine delays. If anything, we can actually make more money leasing our engines out in the market because engines are such a high priority in the business globally right now. So coming back to your question, straight answer is no impact at Jazeera. We're very positive with the relationship with CFM. We're looking for more growth aircraft and more growth engines. Thank you.

I see 3 more questions in the queue at the moment. Would it be okay to take them?

Look, since we had a super year and since Al Qadsiah won the Super Cup, we're going to allow the 3 questions today. Go ahead.

Very kind of you. There's a question that asks if -- sorry, [ Syed Mehdi ] asks -- congratulate you on your results and says as the network and fleet continue to expand, how is Jazeera planning to balance aircraft utilization with crew stability, specifically fatigue management and rostering resilience?

Brilliant question. In fact, I've come from a previous background of FRMS, fatigue risk management systems being implemented. At Jazeera Airways, I can tell you today, we have a sophisticated tool looking at rostering and fatigue risk management systems. Obviously, we don't have a circadian rhythm of operating a lot of overnight flights because our network is kind of balanced. Our crew actually come back home from the flights mostly, except for certain long-range flights in Colombo, they stay over, there's a layover. And when you launch another new destination, there will be a layover for well-being reasons. So we are managing that pretty well. We, in fact, have -- systems have been implemented. Now in terms of crew numbers, yes, I think as you grow, it's a great question, the fact -- in the sense that people only look at aircraft engines, aircraft and engines. Yes, you need pilots, you need cabin crew. And we have no issues hiring cabin crew in Jazeera. In fact, you'll hear some great announcements when we release the Great Place to Work survey results in Jazeera and Kuwait. But more importantly, on pilots, that's why we onboarded a simulator. We are training a lot of young Kuwaiti talent. I like to train female talent as well as male talent to onboard a lot of Kuwaitis. We have a lot of gulf carriers putting their trainees with us. Right now, we have arrangements in Jordan. We have arrangements in Bahrain. And soon, we'll have arrangements in Kuwait, where we have our own campus and university training our own folks. So yes, we have to address that very carefully and we have no issues. We have more than enough adequate pilots, more than enough adequate cabin crew. But it's a great question to ask because I think many people fail to realize that apart from having the metal, you need the people. Thank you.

The next question comes from [ Manju Bashini ]. He asks -- congratulates you on the results and asks if you could please provide clarity on the voluntary acquisition offer. Specifically, we would appreciate details on Boodai Reliance current shareholding. Additionally, are there any plans or considerations regarding potential delisting?

I have no clue. Basically, look, this is the great thing about Jazeera and the governance we have at Jazeera. What I can tell you, I know for a matter of fact, when I sit with some of the Board members of shareholders is the amazing interest and passion for the business. I have never seen this anywhere else in my 30-odd years in career. It is not only the amazing interest and passion for the business, but it's the passion for the country. So I will just leave it at that because this is my personal comments. As for the delisting, I have no clue and I can't indulge you on the question because Krishnan and I, we are captain and copilot of the leadership team navigating the business through what we need to deliver year in, year out. As far as the shareholders are concerned, I can only tell you their phenomenal confidence in -- I think there was a clip in [ Al Ride ], amazing local Arabic newspaper where he talked about the shareholders' passion for the country and what they need to do in the country and how they are proud Kuwaitis investing in Jazeera Airways. I'll leave it at that. I don't think I need to indulge any more. Delisting, no clue. It can happen. It cannot happen. But I can tell you from what I've seen the kind of premiums they are implying to what the market was, there's definite confidence. I came into Jazeera 3 years ago when the share price was only around 800 fils. And after 4Q of 2024 and today, the offer is 1.75. Is it 1.75? Yes, yes. It's phenomenal. So I can tell you that if any shareholder does it, I'll leave it to you. But if personally, I'm going to do it, I only will expect some multiplier growth.

[ Hamood Alka ] asks -- he congratulates you on your results and asks, are there any plans to have a widebody or other than 320 fleets?

Great question. If you see my background, I was a guy who shut down the widebodies in Asia, in Singapore at my previous place where it didn't make sense to be a low-cost airline to operate a widebody aircraft in a very crowded -- listen to what I'm saying carefully. It didn't make sense to operate -- for low-cost airlines to operate a widebody aircraft in a very crowded market with phenomenal presence of national carriers -- world-class with phenomenal presence of world-class carriers like EK, Thai Airways, Qantas, [ Gel ] and where the market was connected to more than 220, 230 points already. Now overlay the questions here, will I consider -- will we consider, I say, a leadership team and the Board consider widebody in Kuwait? I'll leave you guessing. I'll leave you guessing. And with that, I just want to thank all of you for joining on the call, if I may, Nada, end the call in this way. And to really appreciate the loyalty, the shareholders, the investors, the partners have shown us over the last 20 years. We want to thank all of you for that. We want to thank you for the belief in Jazeera Airways. More importantly, we want to thank you for joining with us for the last 20 years and look forward to growing and enriching all of you for the next 20 years. Thank you so much. And I also again like to acknowledge the teams and the people at Jazeera for being outstanding and for delivering what has been an outstanding full year 2025. Thank you.

Thank you.

Thank you, everyone. Thank you, gentlemen. This concludes today's call. You can now disconnect.