Dubai-based Emirates Airline (EK) reported a 72.1% drop in net profit of AED1.5 billion ($409 million) in the 2011-12 financial year, compared to last year’s net profit of AED5.4 billion. The company cited the “stifling” cost of fuel as the reason for the decline. The drop came despite a 14.9% rise in revenue over the preceding year to a record AED62.3 billion.
The Emirates Group, which includes airport and airline support company dnata, recorded net profits of AED2.3 billion, compared to AED5.9 billion for the previous year. Group revenue was up 17.8% to a record AED67.4 billion.
EK chairman and CEO Sheikh Ahmed bin Saeed Al Maktoumsaid the past year’s extremely difficult operating environment encompassed not only rocketing fuel prices and volatile exchange rates but also major regional problems caused by the Arab Spring, which disrupted schedules and passenger flows.
Handling that situation required “immense tenacity,” he said, adding that he was cautiously optimistic for the current year.
Despite a slew of positive figures—passengers up 8% to 34 million, seat factor steady at 80% despite a 9.8% increase in capacity and passenger yields up 7.8%—the bottom line was badly affected by the cost of fuel.
The airline’s fuel bill jumped 44.4% over the previous year to AED24.3 billion. This had been a major factor behind a 24% increase in operating costs.
The airline’s freighter operation, Emirates SkyCargo, reported a strong year with revenues up 8.4% on the previous year at AED9.5 billion.
Dnata achieved a 58.9% leap in revenue to AED7 billion and a record profit of AED808 million.
Article Source : ATW Daily News
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