El Al Israel Airlines moves to net profit in Q2

JERUSALEM, Aug 16 (Reuters) - El Al Israel Airlines (ELAL.TA) on Thursday swung to a net profit in the second quarter as higher revenues and lower operating expenses offset an increase in fuel costs.

Net profit in the second quarter at Israel's flag carrier was $12.6 million, or 3 cents per share, compared with a year-earlier net loss of $10.4 million, or 3 cents a share.

Revenues rose 6 percent to $453 million from $429 million a year earlier reflecting a growth in passenger revenues, the airline said.

Operating expenses dropped by about 2.5 percent from last year's quarter due mainly to an improvement in passenger load factors, which rose to 86.5 percent in the second quarter from 80.5 percent a year ago.

At the same time, El Al said expenses also declined due to an efficiency programme.

Salary expenses dropped in the second quarter compared to last year mainly due to a reduction in the number of employees in Israel and abroad.

"As part of the efficiency program, the company reduced personnel during the quarter, by about 8 percent -- about 500 positions," Haim Romano, El Al's president, said in a statement.

"The company continued with its efficiency programme, cut inefficient and unprofitable routes with high security expenses, and increased frequencies on high-demand routes," Romano added.

Fuel expenses grew to about $120.1 million from $116.6 million in the comparative quarter last year, even after receiving hedging returns this quarter, which totaled about $2.7 million.

Shares in El Al were up 1.5 percent in morning trade in Tel Aviv compared with a 2.5 percent fall in the main stock market index.

((Reporting by Sergio Tjong-Alvares; editing by Paul Bolding; Jerusalem newsroom, +972 2 632 2221, sergio.tjong-alvares@reuters.com)) Keywords: ELAL RESULTS/

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