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Cyprus Airways Sees Paycuts of up to 19%

cyprus airwaysCyprus Airways has proposed paycuts of between 10-19 percent in an effort to reduce its costs and survive increased competition in the market, according to a report on state radio.

The highest paycut rate of 19 percent will be made on salaries that are over 9000 euros per month. Workers are against the cuts, saying that although they are prepared to do their share to save the company, other measures have to be taken as well, such as a boost in capital from other investors.

The airline has been seeking a strategic investor big enough to solve its capital needs problem, and so far there has been interest from Canadian company Triple Five, ME Airlines and an un-named Israeli company. KPMG is also seeking investment from large companies in Cyprus but so far there has been little response, according to the report.

Last year, the airline lost 18.9 million euros in 2011 compared to a profit of 232,000 euros in 2010. Total revenue was 212.4 million euros in 2011, a drop of 10 percent compared to 2010, according to the airline's results.

The signifcant decrease in revenue is mainly due to a reduction in passenger spend and cargo, and the airline said it suffered losses due to the elimination of routes and reduced demand due to the economic crisis.

The company's board of directors said it would cut around 100-150 employees from its 1,100 employees so it can reduce operational costs.

The airline's majority stake of 69.57 percent is held by the state, while 30.43 percent is held by private investors.

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