New CEO - Strategic Change?27 Nov 2019 19:10
It looks like the CEO is making a fundamental change here, he is strategically changing the direction of the company naming it as ‘Franchise House’. He is acknowledging the losses of long term shareholders and realises these losses of hugh and are no longer sustainable. This
could be the start of a turnaround and change of business direction going forward...
Mark Hurst, fastjet Chief Executive Officer, commented:
"The Disposal, if agreed, approved and implemented, would be expected to de-risk the significant uncertainty and cash drain that shareholders have historically suffered and allow the Group to continue operating under a more stablised and simpler business model. This revised strategy allows the Group the opportunity to create a single fastjet brand throughout key markets in Africa, leverage its key intellectual property of its brand and airline management solutions and invest in viable, already-established airlines where it can."
The restructured Group would become a capital light business operating as a franchise house that would earn revenues through the fastjet brand and providing airline management solutions, whilst also continuing to hold its investment in the FedAir business. The Group's strategy is to focus on franchise and providing airline management solutions to additional airlines in Africa that are independently owned, enhancing its overall revenues from these. Additionally, the Group would aim to only own airlines once they were cash generative and profitable, so avoiding the initial costs and significant cash losses through the airline startup phase and from operating in Africa's sometimes uncertain trading environment.
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