Dubai: Emirates Group full-year profit grew by 50 per cent to a record high in 2015-2016 as low oil prices slashed operating costs at the world’s largest international airline.
Profit rose to Dh8.2 billion ($2.2 billion) in the 12 months to March 31, up from Dh5.5 billion in the previous year, Emirates said on Tuesday.
It is the Group’s 28th consecutive year of profitability and its highest ever profit. Revenue declined 3 per cent to Dh92.9 billion under pressure from the strong dollar.
“The US dollar continued to rise strongly against currencies in most of our key markets,” Chairman and Chief Executive Shaikh Ahmad Bin Saeed Al Maktoum said at Emirates headquarters in Dubai.
The strong dollar had a “Dh6 billion impact on the airline revenue and a Dh4.2 billion impact on the airline bottom line,” Shaikh Ahmad said.
Emirates airline recorded its strongest ever profit with a 56 per cent increase to Dh7.1 billion though revenue fell by 4 per cent to Dh85 billion, largely due to the dollar.
Falling oil prices, which lost around 32 per cent of their value in Emirates’ financial year, gave the airline a Dh9 billion cost saving, Shaikh Ahmad said. Its fuel bill, down 31 per cent, accounted for 26 per cent of its operating costs compared to 35 per cent in the year prior.
While the airline saw savings in the lower fuel price there was also a negative impact on air travel, Shaikh Ahmad said.
“The low fuel price also come with a downside to poor business and consumer confidence and adds downward pressure on the airfare, impacting demand,” he said.
Shaikh Ahmad said Emirates would pay its owner, the state-owned Investment Corporation of Dubai, a Dh2.5 billion dividend, which is 3 per cent less than the previous year.
Shaikh Mohammed Bin Rashid Al Maktoum, Vice President of the United Arab Emirates and Ruler of Dubai, said in a statement he was confident “Emirates and dnata will continue to thrive and contribute to Dubai’s and the UAE’s success.”
The Group’s airport and travel services company dnata had a record high profit that surpassed Dh1 billion for the first time. Dnata made Dh1.1 billion, up 16 per cent, while revenue was Dh10.6 billion, also up 16 per cent.
