Dubai: Qatar Airways profit for the financial year that ended March 31, 2015 will be lower than expected due to last year’s delays in the delivery of Airbus aircraft, Chief Executive Akbar Al Baker said on Wednesday.
“Our performance was not what we expected due to the delay of the four A380s,” he said at the Arabian Travel Market (ATM) in Dubai.
Qatar Airways was caught in a standoff with Airbus last year where it refused to accept delivery of the world’s largest passenger jet over what it said were quality issues. Al Baker said that standoff has meant that the airline’s profit is less than he had initially estimated.
He did not state what the profit target was or by how much it had been missed.
Qatar Airways, whose financial year runs from April 1 to March 31, does not release its financial results. However, Al Baker said that will change this year.
“We will make it public,” he said without stating when.
Last November, Al Baker said the three-month delay in taking delivery of its first A380 cost the airline more than $200 million (Dh734 million) in lost revenue. Al Baker has previously declined to comment as to whether he would seek compensation for the delays. In the past, Qatar Airways has received compensation from another aircraft manufacturer, Boeing Co, over the grounding of the 787 Dreamliner.
Despite the profit warning, Qatar Airways’ financial performance for 2014-2015 is expected to be boosted by last year’s collapse in global oil prices.
Fuel prices
Generally, fuel can account for between 30 and 40 per cent of an airlines cost. The global oil benchmark, Brent crude, more than halved from June to January from a high of around $115 a barrel to $45 a barrel. It has since risen to about $65 a barrel.
“When the fuel prices were high it was eating our profit it was eating into our margins,” he said, however also warned that the strengthening US dollar had hurt the airline in some markets. The Qatari riyal is pegged to the dollar.
Qatar Airways will be hoping a new joint venture signed with Royal Air Maroc at the Arabian Travel Market (ATM) on Wednesday will boost revenues. The joint venture will see the airlines work together on the Doha-Casablanca route. Royal Air Maroc will also code-share on Qatar Airways flights from Doha to Asia and Qatar Airways will code-share on Royal Air Maroc flights to Africa from Casablanca, Al Baker said.
Qatar Airways is now “very seriously looking at launching a direct flight to Marrakesh,” he added.
Royal Air Maroc has been mulling joining one of the major three global airline alliances. Chairman and Chief Executive, Driss Behima, said the airline has not made a decision.
Qatar Airways is a member of the oneworld alliance.
