Dubai: Air Arabia, the United Arab Emirates’ only listed airline, on Sunday blamed the impact of low oil prices on the economy for a 6 per cent drop in full-year profit.

The airline made Dh531 million in the 12 months to December 31, 2015, compared to Dh566 million in 2014, it said in an emailed statement. Revenue for the period improved by 2.7 per cent to Dh3.8 billion, up from Dh3.7 billion in the previous year.

“The impact of low oil prices continues to have its effect on the wider global economy, while pressure on yields and geopolitical uncertainty continued to weigh on the aviation industry,” Air Arabia Chairman Shaikh Abdullah Bin Mohammad Al Thani said in the statement.

The airline carried more than 7.6 million passengers in 2015, 12 per cent more than the previous year, and filled an average of 76 per cent of all seats, the statement said.

Fourth quarter profit, meanwhile, fell by 13 per cent to Dh59 million over three months to December 31, 2015, down from Dh68 million a year earlier. It is the airline’s third consecutive quarter where it has reported a fall in profits. Revenue for the period was Dh957 million, a 4 per cent improvement on the Dh924 million it reported for 2014.

Over the last five quarters, Air Arabia has posted just one quarter of profit growth. The last time being the first quarter of 2015 when profits rose 13 per cent to Dh85 million. The airline has not reported a loss over those five quarters.

Capacity

Air Arabia previously blamed its fuel hedging strategy when it reported a 30 per cent drop in 2014 fourth quarter profit, however, in September 2015 Chief Executive Adel Ali had said the strategy should not be over emphasised and instead complained the Middle East market was suffering from an “irrational” level of capacity.

Forty-five per cent of Air Arabia’s 2015 fuel requirements were hedged at $90 (Dh330.57) a barrel, according to an investor presentation slide available on the airline’s website in September 2015. This was higher than the cost average cost of oil with global benchmark Brent crude peaking in 2015 at $67.77 a barrel and touching a low of $36.46 a barrel.

Over the fourth quarter, the airline said, it carried 2 million passengers, up 17 per cent on the same 2014 period. The airline opened its fifth hub in 2015, launching Air Arabia Jordan at Queen Alia International Airport in Amman. Air Arabia became the first low cost carrier from the Middle East and Africa to enter the Chinese market when it started flights to Urumqi in 2015. In total it added 23 routes to its network throughout the year.

The airline has proposed a dividend of 9 fils per share.