(MENAFN - Khaleej Times) Dubai carrier?s net profit soars 43% to dh3.
emirates dubai’s flagship airline on thursday declared a 43 per cent year-on-year increase in net profit for financial year 2013-14 mainly on international expansion and lower fuel costs.
the world’s fourth-largest carrier of international passengers reported a dh3.3 billion profit for 2013 compared to dh2.3 billion for the previous year according to its financial statement. its revenues rose to dh82.6 billion showing a 13 per cent increase over previous year’s dh73.1 billion.
“it has been a good year. there was growth in our business all round and fuel costs fell by about four per cent last year which helped” shaikh ahmed bin saeed al maktoum president of the dubai civil aviation authority chairman of emirates airline and chief executive of the emirates group told reporters a news conference at the emirates headquarters in dubai.
he said that the profit margin is more than double the industry. responding a question he said that the 80-day runway repair will at dubai international airport will cost the airline dh1 billion in revenues this year.
emirates is expected to be more of the same as it heads towards a 27th straight year of profitability according to a senior aviation analyst.
“emirates’ 26th year of profitability underlines the airline’s excellent execution of managing to grow faster than any other airline while being totally independent” saj ahmad chief analyst at london-based strategicaero research told khaleej times. “emirates’ strategy of organic growth is paying significant dividends as the airline effectively suppressed fuel costs while deploying fuel-efficient jets like the 777-300er and capitalising on effective use of the high-capacity a380 on key trunk routes that have lowered costs per seat and made fares more price elastic for customers.”
emirates which is the world’s largest customer for the twin-deck airbus a380 as well as for boeing’s new 777 jet said it carried 44.5 million passengers last year more than 13 per cent it carried in the previous year. the airline added nine destinations in asia europe and north america and took delivery of two dozen new planes. a double-digit growth in passenger numbers has helped to boost traffic at dubai international to the extent that it has overtaken london heathrow for this first quarter this year as the world’s busiest international airport ahmad said.
emirates has used dubai as a true global nexus point and also leveraged the strength of the a380 as a big mover and the 777-300er as a long-haul high-yield revenue-raising machine to augment its growth he added.
the carrier is also seeing average fares come under pressure as rivals seek to counter its expansion shaikh ahmed said.
“our industry has always been competitive and that competition is getting more intense.”
he mentioned that competition from other airlines which “lobby their governments to restrict us” remained another challenge.
an emirates route from milan to new york’s john f. kennedy airport introduced in last october faces a challenge in the italian courts. “we will continue service” shaikh ahmed told reporters in response to a question.
in 2013-14 emirates increased capacity by 5.9 billion available tonne kilometres (atkms) the largest capacity increase in the airline’s history in a single year. this brings emirates’ total passenger and cargo capacity to 46.8 billion atkms at the end of the financial year. the airline also marked a new record of over 1 million block hours in terms of fleet production.
emirates received 24 new aircraft during the year including 16 a380s six boeing 777-300ers and two boeing 777fs bringing its total fleet count to 217. the airline remains the world’s largest operator of the boeing 777 and a380 – both aircraft being amongst the most modern and efficient wide-bodied jets in the sky today.
emirates revenue for the first time surpassed dh80 billion at a new record of dh82.6 billion. while the average price of jet fuel remained high it was slightly lower compared to last year and has supported emirates’ bottom line improvement. emirates’ fuel bill increased by 10 per cent over last year to reach dh30.7 billion. total operating costs increased by 12 per cent compared to a revenue increase of 13 per cent over the 2012-13 financial year.
the airline successfully managed increased competitive pressure across all markets to record a profit of dh3.3 billion an increase of 43 per cent over last year’s results and a healthy profit margin of 3.9 per cent.
carrying record passengers emirates maintained a robust passenger seat factor at 79.4 per cent nearly consistent with last year’s results in spite of a 15 per cent increase in seat capacity by available seat kilometres (askms). this highlights the strong consumer desire to fly on emirates’ state-of-the-art aircraft. passenger yield remained steady at 30.4 fils (8.3 us cents) per revenue passenger kilometre (rpkm).
emirates also improved its premium seat factor despite lingering economic uncertainty and strong competition in many markets. premium and overall seat factor for the airline’s flagship a380 aircraft outperformed the network underscoring the popularity of emirates’ premium and a380 product amongst passengers. over 18 million passengers had flown on an emirates a380 when the airline marked its fifth anniversary of a380 operations in august 2013.
revenue generated from across emirates’ six regions continues to be well balanced with no region contributing more than 30 per cent of overall revenues. east asia and australasia remained the highest revenue contributing region with dh23.8 billion up 14 per cent from 2012-13. gulf and middle east revenue increased 17 per cent to dh8.3 billion and europe revenue increased 16 per cent to dh23.4 billion reflecting new destinations as well as increased frequency and capacity to these regions.
across the rest of the globe emirates saw strong revenue increases from africa up 15 per cent to dh7.7 billion the americas up 11 per cent to dh9.2 billion and west asia and indian ocean with dh8.3 billion in revenue up 3 per cent.
in its first full year of operations the newly commissioned concourse a at dubai airport for emirates’ growing a380 fleet witnessed a significant passenger throughput with 37 per cent or 8.2 million emirates passengers departing dubai enjoying the new state-of-the art facilities spacious lounge areas to board 27000 flights.
looking forward to 2014-15 emirates has to date announced five new passenger routes including abuja brussels chicago kano and oslo.