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Brazil airline Gol losses to end by 4th qtr-report
July 2, 2012 / 4:19 PM / 5 years ago

Brazil airline Gol losses to end by 4th qtr-report

* New CEO: 2,000 job cuts so far to yield results

* Airline posts losses in three of past four quarters

* CEO sees stable “short- to mid-term” fleet size

SAO PAULO, July 2 (Reuters) - Gol Linhas Aereas , Brazil’s No. 2 airline, aims to staunch losses by the fourth quarter, its new chief executive told a local newspaper, promising to show results after a wave of recent layoffs.

CEO Paulo Kakinoff, the former head of Volkswagen AG’s Audi operations in Brazil, told Estado de S.Paulo in the interview published on Monday that financial results would improve after the cutting of 2,000 jobs in the first half of 2012. As many as 500 more job cuts could come by December, he said.

“We expect to revert the negative results in the final quarter (of 2012). That is, to arrive at the end of the year at least breaking even,” Kakinoff said. His comments were confirmed by a Gol press representative.

Gol posted losses in three of the past four quarters, paying the price for growing too fast as air traffic in Latin America’s largest economy slowed after years of double-digit growth.

Aggressive expansion plans met with a glut of available seats in the market and falling ticket prices last year, just as fuel prices and payrolls drove costs higher.

Kakinoff does not expect air traffic demand to fall any more than it has recently. He added that Gol and subsidiary WebJet’s combined fleet should remain around 138 planes in the “short and medium term” after dropping by 12 planes this year.

The new CEO is taking the reins from Constantino de Oliveira Jr., a member of the company’s founding and controlling family who remains Gol’s chairman.

Oliveira, who also participated in the Monday interview, was quick to dismiss speculation that the hand-off was part of a plan to ready Gol for a takeover.

“There is no thought of a sale and even less the idea that Kakinoff is overseeing a transition or anything of the sort,” said Oliveira, who will share an office with the new executive.

Gol shares were little changed in mid-day Sao Paulo trading, after losing 28 percent so far this year and more than one-half of their value in the past 12 months.

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