Emirates Airline half-year profit slides 86% on oil hike
Dubai-based airline warns next six months will be tough as profit falls to $62m and cost of fuel amounts to a third of expenses
Emirates Airline on Thursday posted an 86% drop in half-year profits as the Middle East’s leading carrier was hit by a hike in oil prices and currency devaluations.
The Dubai-based airline said in a statement its net profit in the six months to September 30 was also negatively affected by other challenges and expected tough months ahead.
Emirates said it recorded a profit of just $62m in the first half of the 2018/19 financial year compared with $452m in the same period last year.
“The high fuel cost as well as currency devaluations in markets like India, Brazil, Angola and Iran wiped approximately 4.6-billion dirhams [$1.25bn] from our profits,” said Sheikh Ahmed bin Saeed Al-Maktoum, chair and CEO of Emirates Group.
Emirates, one of the world’s biggest airlines, said fuel costs rose 42% compared with the same period last year.
The company, which flies to more than 150 destinations, said the cost of fuel amounted to a third of its expenses.
Emirates is the world’s largest operator of Airbus A380s with more than 100 of the superjumbos in its fleet.
“The next six months will be tough, but the Emirates Group’s foundations remain strong,” Sheikh Ahmed said in a statement.
In the six months to September 30, the airline carried 30.1-million passengers, a rise of 3% on the last financial year, the company said.
Emirates’s revenues were 10% higher than the previous year at $13.3bn.
“We are proactively managing the myriad challenges faced by the airline and travel industry, including the relentless downward pressure on yields and uncertain economic and political realities in our region and in other parts of the world,” said Sheikh Ahmed.
Profit for the Emirates Group, which also includes Dnata, a leading air services provider, was also down 53% to $296m.