Muscat – The national airline of the sultanate, Oman Air, has unveiled an extensive restructuring plan aimed at reversing continuing operational losses and reducing accumulated financial debt.
At a press conference held on Monday, Said bin Hamood al Maawali, Minister of Transport, Communications and Information Technology, who also chairs the Board of Directors of Oman Air, confirmed the board’s decision. It has approved a comprehensive restructuring program- me that will be implemented to improve the airline’s earnings.
The restructuring will be based on a study conducted by consultant Oliver Wyman, who was appointed on the Royal Orders of His Majesty Sultan Haitham bin Tarik.
Based on the study, steps have been initiated to enhance Oman Air’s performance starting next year, with an ambitious target to reduce its losses by 15% during the current year. Maawali expressed optimism, stating that the airline plans to break-even within the next three years.
Detailing the restructuring plan, Maawali outlined four key areas of focus: financial sustainability, corporate governance, commercial aspects, and human capital. The restructuring will bring changes to senior and middle management, reduce expenses and improve financial returns. The plan includes measures to curb the level of debt and other financial obligations.
The Board of Directors has fully endorsed the recommendations presented by Wyman, who analysed Oman Air’s financial and commercial performance. This study provided concrete strategies to overcome existing financial challenges and guide the airline towards sustainable business operations. The comprehensive transformation programme is projected to last about four years.
Emphasising the complexity of the transformation, Maawali said, “Many changes will be made in the current executive team of Oman Air in the coming months, reforming the company’s Board of Directors and attracting experts and competencies specialised in the aviation sector, whether local or international.”
Specialised committees focused on governance, and human, financial and commercial resources will be created to report to the board. Furthermore, a specialised office will work with executive and advisory management to ensure the successful implementation of Oman Air’s recovery plan.
The restructuring process will also include an extensive review of Oman Air’s destinations by international experts. This evaluation will enable informed decisions on continuing or discontinuing certain routes. Integration efforts with local aviation companies, both for domestic and international destinations, will be part of the transformation.
The restructuring is a decisive and strategic response to the challenges facing the airline. It underscores a commitment to achieving financial sustainability and positioning the carrier to navigate the turbulent skies of the global aviation industry.