Etihad sharply cuts 2021 losses as cargo revenue soars
Cargo revenue up 49% to all-time high of $1.73b; airline ferries 3.5m passengers in 2021
Abu Dhabi: Etihad Airways recorded a sharp drop in losses in 2021 at $476 million compared to a loss of $1.70 billion in the year-ago period, the airline said on Tuesday.
The airline carried 3.5 million passengers in 2021, with an average seat load factor of 39.6 per cent. Passenger loads doubled in the second half of the year, reaching 70.1 per cent in December as travel demand peaked during the winter holiday period.
The airline recorded a particularly strong surge in passenger volumes in Q4 following the September relaxation of mandatory quarantine periods in Abu Dhabi.
The airline posted passenger revenues of $1.07 billion in 2021, down by 14 per cent year-on-year. While ongoing travel restrictions and new variants of the virus dampened demand, the airline saw passenger revenues bounce back in the last quarter of the year, recovering to 50 per cent of 2019 levels in December.
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Strong cargo operations
Cargo operations continued to outperform expectations, with a 27 per cent year-on-year increase in freight carried in 2021 (729,200 tonnes) coupled with a rise in cargo revenues of 49 per cent to $1.73 billion, the highest figure in the history of the airline.
Tony Douglas, Group CEO, commented: "In another year of global uncertainty, Etihad Airways has continued to move forward, strengthen its business, and build on its world-class travel proposition. As always, this has been thanks to our remarkable people who have gone above and beyond to make the most of every opportunity.
“Despite the slowdown caused by Omicron, we are confident that the spring and summer season will continue to see a resurgence in travel as more people return to the skies. “
> HOPE Consortium, an Abu Dhabi coalition of which Etihad is a founding member, has to date handled more than 250 million vaccine doses to over 40 countries in the Middle East, Africa, Europe, Asia and South America.
> Pharma shipments using the airline’s specialised PharmaLife product increased by 85 per cent.
> Etihad has temporarily modified five Boeing B777 aircraft to support cabin-loaded cargo, operating over 800 charter and scheduled cargo flights in the new configuration in 2021.
> Etihad Cargo maintained an on-time-performance and delivered-as-promised rating of 85 per cent during 2021.
Lower costs
Even as operations progressively ramped up throughout 2021, the airline managed to keep a sharp focus on cost control, decreasing operating costs by a further $110 million, despite a $197 million increase in fuel costs driven by rallying oil prices.
Overall, Etihad recorded a core operating loss of $476 million for fiscal year 2021, representing a 72 per cent improvement compared to 2020 ($1.70 billion) and a 41 per cent improvement against pre-pandemic results in 2019 ($802 million). EBITDA improved by more than $1 billion, turning to positive $408 million from a negative $651 million in 2020.
Strategic push
The airline announced a proposed transaction in December 2021 to divest a number of subsidiary businesses to ADQ, one of the region's largest holding companies. The transaction is set to be completed in 2022.
Once the transaction is complete, Etihad Engineering, Etihad Airport Services Cargo, Etihad Airport Services Ground, Etihad Aviation Training, Etihad Secure Logistics and Etihad Technical Training will become part of the new entity.
Additionally, two Etihad businesses will join Abu Dhabi National Exhibition Company (ADNEC). Etihad Airport Services Catering will combine with ADNEC’s catering business Capital Hospitality, and Etihad Holidays will join ADNEC’s tourism promotion business, Tourism 365.
Etihad’s joint venture airline, Air Arabia Abu Dhabi, continued to grow in 2021 with the launch of seven new destinations, expanding its network to 15 cities by the end of the year.
Growing network
The number of passenger destinations grew by 28 per cent in 2021, from 50 up to a high of 64 during the summer peak, as the airline rebuilt air connectivity and tapped into pent-up travel demand.
The airline’s total fleet at the end of 2021 comprised 67 aircraft including, five freighters, with the backbone being the highly fuel-efficient B787 Dreamliner. Etihad, one of the largest operators of this aircraft type in the world, has 39 B787-9 and B787-10s in its fleet.
It is also preparing to enlist new Airbus A350 aircraft into service, with the first one set to take off in Q2 2022.
Codeshare alliances
The airline continued to build on its codeshare network in 2021 by strengthening existing agreements with key partners such as Gulf Air, and forging a new partnership with El Al. At the end of the year, Etihad had 50 active codeshare partnerships, expanding its network reach to more than 400 cities worldwide.