PATWA NEWS ONLINE

Profits Fall by 72 Percent

Dubai's flagship carrier Emirates reported a 72 percent drop in 2011 profits as soaring fuel prices accounted for nearly half of the Gulf carrier's costs. Emirates, among the top 10 in the world by passenger numbers, had profit of AED 1.5 billion (USD 409 million) for the fiscal year ended March 31, 2012; compared to a profit of AED 5.4 billion in 2010. Revenue at the Dubai government-owned airline was AED 62.3 billion in 2011, up 14.9 percent. The airline's fuel bill rose 44.4 percent in the 2011/2012 financial year to AED 24.3 billion dirhams, or 40 percent of total costs.
Rising fuel costs and the financial turmoil in Europe are expected to impact earnings of most global carriers, the International Air Transport Association (IATA) said in April 2012. The airline's passenger seat factor was 80 percent, in line with the prior year. Profits for the wider Emirates Group were AED 2.3 billion, including airline services arm, Dnata. Emirates paid an AED 500 million dividend to the Dubai government while Dnata paid AED 350 million. In 2010, Emirates' dividend payout was AED 2.3 billion.
The airline is the world's largest customer of the Airbus A380 superjumbo. It ordered 90 A380 aircraft in 2010, with about 70 yet to be delivered. It is competing with Abu Dhabi's Etihad Airways and Qatar Airways, as the state-backed carriers look to transform the Gulf region into the new hub for global aviation.
Emirates' drop in profits is in line with its competitors like Air France-KLM, German flagship airline Deutsche Lufthansa and Cathay Pacific. Air France-KLM's first-quarter losses widened and Cathay posted a 61 percent drop in 2011 profit-- both hit by high fuel costs and the slowing global economy.