Dubai: Cost-cutting measures combined with lower jet fuel prices and increased productivity helped Emirates airline record an unprecedented 415.7 per cent jump in net profits to $964 million for the financial year ending March 2010, up from $187 million a year ago.
The airline carried 20.8 per cent more passengers last year, totalling 27.5 million and generating revenues of $11.8 billion, roughly the same as in the previous year.
Emirates Group, which operates the airline, reported a 248 per cent growth in profits to $1.1 billion for the 2009-10 financial year, up from $325 million in 2008-09 and bucking the worldwide trend marred by low yields and losses.
Group revenue
Group revenue increased a marginal 0.4 per cent from $12.3 billion to $12.4 billion, and how the Dubai Government-owned organisation managed to generate such huge profits at a "very challenging time" remains a wonder to aviation pundits.
"Cost cutting has been the main driver," Shaikh Ahmad Bin Saeed Al Maktoum, President of Dubai Civil Aviation and Chairman and Chief Executive of Emirates Airline and Group, told a media briefing announcing the results.
"During these difficult times, we froze recruitment and some of our colleagues took unpaid leave. Across the board, we managed to improve productivity," he said.
"Wherever yields fell, we offset that by carrying more passengers without compromising on quality of service."
The positive results have prompted the airline to buy more aircraft.
Shaikh Ahmad said the airline could make an announcement in "eight weeks' time" — presumably at the Farnborough Airshow.
Lower fuel costs helped the airline achieve a Dh2.5 billion ($691 million) saving. Fuel accounted for 29.9 per cent of operating costs, down from 35.2 per cent the previous year.
"During the year, we managed to cut costs by 16 per cent, with a combination of lower fuel costs and cost cutting," Tim Clark, president of Emirates, told Gulf News.
Fleet of 145
Emirates, meanwhile, has resumed recruitment. This year it will add 5,000 people to its current staff strength of 49,950.
Emirates, established by the Dubai Government in 1985 with just $10 million, remained profitable in all but one year in its 24 years of operation.
This is the airline's 22nd year of consecutive profits. The airline currently has a fleet of 145 aircraft serving 102 destinations in 62 countries.
At the end of the year, the airline's cash balance remains strong at $3.4 billion, enough to fund its current financial obligations.
It has an order book of 146 aircraft worth $48 billion.
- 5,000: the number of people Emirates plans to hire
- 146: aircraft are on thecompany's order book
- 27.5m: passengers carried in 2009
