April 4 (Bloomberg) -- AirBaltic AS, Latvia’s state-owned airline, said an initial public offering is becoming a viable option after it returned to profit a year ahead of schedule.
“We are looking carefully at how this would be done, where this would be done, but I would say it’s not impossible anymore,” Chief Executive Officer Martin Gauss said in an interview. Any decision on a share sale or IPO will be made by the government, which holds the company’s shares, he said.
AirBaltic said this week it had net income of more than 1 million euros ($1.4 million) in 2013 after cutting costs and raising fares on some routes. That compares with losses of 27 million euros in 2012 and 123 million euros in 2011, when Gauss, a German who once led Hungary’s Malev Zrt., took over.
The Latvian government invited expressions of interest in AirBaltic in mid 2012, and has yet to sell any stock, though Gauss said he has been meeting with potential investors.
The airline had estimated net income would increase to 5 million euros for 2014, though after a deal yesterday with administrators for two bank creditors there will be a one-time gain of more than 10 million euros, Gauss said in Riga.
Revenue will remain at about 325 million euros this year, with ticket prices increasing about 1 percent and the passenger count reaching about 3 million, he said.
A European Commission probe into whether AirBaltic received illegal state aid that began in November 2012 should reach a satisfactory conclusion in a matter of weeks, with no more information being requested, the CEO said.
“We would like to have it off our backs, because for the investor attraction, it’s always an issue,” he said.
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