Emirates Group: AED 1.year 2 billion profit in first half of 2019-20 financial
The Emirates Group today announced its half-year results because of its 2019-20 financial year.
Group revenue was AED 53.3 billion (US$ 14.5 billion) for the initial half a year of 2019-20, down 2% from AED 54.4 billion (US$ 14.8 billion) through the same period this past year. This slight revenue decline was due mainly to planned capacity reductions through the 45-day Southern Runway closure at Dubai Airport terminal (DXB), and unfavourable currency movements in Europe, Australia, South Africa, India, and Pakistan.
Profitability was up 8% when compared to same period this past year, with the combined group reporting a 2019-20 half-year net profit of AED 1.2 billion (US$ 320 million). The profit improvement was primarily as a result of decline in fuel costs of 9% when compared to same period this past year, nevertheless the gain from lower fuel prices were offset by negative currency movements partially.
The Group’september 2019 stood at AED 23 s cash position on 30th.0 billion (US$ 6.3 billion), in comparison to AED 22.2 billion (US$ 6.0 billion) as at 31st March 2019.
His Highness (HH) Sheikh Ahmed bin Saeed Al Maktoum, Chief and chairman Executive, Emirates Airline and Group said: “The Emirates Group delivered a confident and steady performance in the initial 1 / 2 of 2019-20, by adapting our ways of navigate the tough trading conditions and social-political uncertainty in lots of markets all over the world. Both Emirates and dnata worked hard to minimise the impact of the planned runway renovations at DXB on our business and on our customers. We also kept a good rein on controllable costs and continued to operate a vehicle efficiency improvement, while making certain our resources were deployed to capitalise on regions of opportunity nimbly.
“The low fuel cost was a welcome respite once we saw our fuel bill stop by AED 2.year 0 billion compared to the same period last. However, unfavourable currency movements wiped off AED 1 approximately.2 billion from our profits.
“The global outlook is difficult to predict, but we expect the airline and travel industry to keep facing headwinds on the next half a year with stiff competition adding downward pressure on margins. As a combined group we remain focussed on developing our business, and we will continue to spend money on new capabilities that empower our people, and enable us to provide better products even, services, and experiences for the customers.”
The Emirates Group’s employee base remained unchanged in comparison to 31 March 2019, at a standard average staff count of 105,315. That is based on the company’s planned business and capacity activities, and in addition reflects the many internal programmes to boost efficiency through the implementation of new workflows and technology.
During the initial half a year of 2019-20, Emirates received 3 Airbus A380s, with 3 more new aircraft scheduled to be delivered prior to the final end of the 2019-20 financial year. In addition, it retired 6 older aircraft from its fleet with an additional 2 to be returned by 31 March 2020. The airline’s long-standing technique to invest in probably the most advanced wide-body aircraft enables it to boost overall efficiency, minimise its emissions footprint, and offer top quality customer experiences.
Emirates continues to provide ever better connections because of its customers around the world with just one single stay in Dubai. Year in the initial half a year of its financial, Emirates added two new passenger routes: Dubai-Bangkok-Phnom Penh, and Dubai-Porto (Portugal). September as of 30, Emirates’ global network spanned 158 destinations in 84 countries. Its fleet stood at 267 aircraft including freighters.
Emirates further developed its partnership with flydubai also. Both airlines continued to leverage their complementary networks to optimise flight offer and schedules new city-pair connections through Dubai, along with open new routes including Naples (Italy) and Tashkent (Uzbekistan) in the initial 1 / 2 of 2019-20. Customers also enjoy more benefits with an individual loyalty programme under Emirates Skywards even, and passengers connecting between Emirates and flydubai can experience seamless transits with 22 flydubai flights now operating from Emirates Terminal 3 at DXB.
Overall capacity through the first half a year of the entire year declined by 7% to 29.7 billion Available Tonne Kilometres (ATKM) mainly because of the DXB runway closure and decrease in fleet in this 45-day period. Capacity measured in Available Seat Kilometres (ASKM), shrunk by 5%, whilst passenger traffic carried measured in Revenue Passenger Kilometres (RPKM) was down by 2% with average Passenger Seat Factor rising to 81.1%, weighed against last year’s 78.8%.
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Emirates carried 29.april and 30 September 2019 6 million passengers between 1, down 2% from exactly the same period this past year, however, passenger yield increased by 1% period-on-period. The quantity of cargo uplifted at 1.2 million tonnes has decreased by 8% while yield declined by 3%. This reflects the tough business environment for air freight in the context of global trade tensions and unrest in a few key cargo markets.
In the initial 1 / 2 of the 2019-20 financial year, Emirates net profit was AED 862 million (US$ 235 million), up 282%, year compared to last. Emirates revenue, including other operating income, of AED 47.3 billion (US$ 12.9 billion) was down 3% weighed against the AED 48.9 billion (US$ 13.3 billion) recorded through the same period this past year. This total result was driven by increased agility in capacity deployment, with healthy customer demand for Emirates’ products driving improved seat load factors and better margins.
Emirates operating costs shrunk by 8% contrary to the overall capacity loss of 7%. Typically, fuel prices were 13% lower when compared to same period this past year, this is largely because of reduction in oil prices (down 9% in comparison to same period this past year), in addition to a lower fuel uplift because of reduced capacity during 45-day runway closure at DXB. Fuel remained the biggest element of the airline’s cost, accounting for 32% of operating costs weighed against 33% in the initial half a year of this past year.
dnata continued to strengthen its global capabilities in ground handling, travel and catering services, with operations spanning over 35 countries. In the initial 1 / 2 of 2019-20, dnata’s international operations accounted for over 72% of its revenue, in comparison to 68% through the same period this past year.
dnata’s revenue, including other operating income, was AED 7.4 billion (US$ 2.0 billion), a 5% increase in comparison to AED 7.0 billion (US$ 1.9 billion) this past year. This performance was underpinned by robust business growth and additional global expansion, in its catering business particularly.
Overall profit for dnata was down by 64% to AED 311 million (US$ 85 million), in comparison to last year’s result including an AED 321 million one-off gain from the divestment of dnata’s 22% stake in the travel management company Hogg Robinson Group (HRG). dnata’year profit for 2019-20 was further influenced by the bankruptcy of Thomas Cook s half, among its major customers for dnata’s catering and travel businesses in the united kingdom, leading to an impairment loss on trade receivables and intangible assets amounting to AED 84 million.
dnata’s airport operations remains the biggest contributor to revenue with AED 3.6 billion (US$ 983 million), year hook increase in comparison with exactly the same period last. Across its operations, the real amount of aircraft handled by dnata remained steady with 351,194, also it handled 1.5 million tonnes of cargo, down 6%.
Organic growth across dnata’s international ground handling business with key contract wins across US locations, and improved performance in markets such as for example Italy, Singapore, Iraq and switzerland, helped drive dnata’s revenue and compensate for the negative currency impact of AED 86 million approximately. In the UAE, dnata acquired full ownership of freight forwarding company, Dubai Express, half year of 2019-20 which bolstered its revenues in the initial, and helped soften the impact of losses as a result of 45-day runway closure at DXB.
dnata’s travel division contributed AED 1.8 billion (US$ 488 million) to revenue, up 7% from exactly the same period this past year. The division’s underlying total transactional value sales remained at AED 5.9 billion (US$ 1.6 billion).
The strong revenue contributions from its new acquisitions including Tropo in Germany, and Dunya Travel, helped offset weaker travel demand in other key travel markets, plus the negative impact of the strong US dollar contrary to the Pound and Euro Sterling.
dnata’s flight catering operation, contributed AED 1.8 billion (US$ 479 million) to its total revenue, up 54%. The quantity of meals uplifted increased by 67% to 51.year 9 million meals for the first half of the financial.
This significant uptick is basically related to the contributions from its recently-acquired catering businesses in Australia (Q Catering Limited and Snap Fresh Pty Limited), and in america (121 Inflight Catering); in addition to the expansion of dnata’s own catering facilities in america including at Houston, Boston, and LA.