Abu Dhabi’s Etihad reports $1.7bn loss for 2020, passenger traffic down 76%

UAE national carrier Etihad Airways said that it carried 4.2 million passengers in 2020, down 76 per cent from 17.5 million passengers it flew in 2019.

More than 80 per cent of the total passengers carried in 2020 were flown during the first three months of the year, the airline said which demonstrates the “precipitous drop in demand as the global crisis deepened over the course of the year.”

Total passenger capacity was reduced by 64 per cent in 2020 to 37.5 billion Available Seat Kilometres (ASKs), down from 104 billion in 2019, with the seat load factor declining to 52.9 per cent, 25.8 percentage points lower compared to 2019.

The airline reported $1.2bn in passenger revenues in 2020, down by 74 per cent from $4.8bn the previous year.

Operating costs decreased by 39 per cent year-on-year, from $5.4bn in 2019 to $3.3bn in 2020, which the airline attributed to “a combination of reduced capacity and volume-related expenses, as well as a focus on cost containment initiatives.”

The carrier’s overheads reduced by 25 per cent to $0.8bn, despite their fixed nature, owing to cash and liquidity management initiatives during the crisis, while the finance cost reduced by 23 per cent through an ongoing focus on balance sheet restructuring.

It resulted in a core operating loss of $1.7bn in 2020, dipping 112 per cent from the $0.8bn loss it reported for 2019, with the EBITDA turning to negative $0.65bn (2019: positive $0.45bn).

In a statement, the airline said that it is continuing to target a complete turnaround by 2023, having accelerated its transformation plans and restructured the organisation during the pandemic.

In November, the airline announced a major reshuffle among its top management as it sought to reposition itself as a mid-sized, full-service carrier.

The business units within Commercial are now under Mohammad Al Bulooki, chief operating officer; Adam Boukadida, chief financial officer; and Terry Daly, who will assume the role of executive director guest experience, brand and marketing.

Read: Major restructuring among top management at UAE’s Etihad airline

Additionally, Al Bulooki will assume responsibility for network planning, sales, revenue management, cargo and logistics, commercial strategy planning, and alliances.

The airline’s cargo operation meanwhile recorded a 66 per cent increase in revenue from $0.7bn in 2019 to $1.2bn in 2020. Cargo yield saw an improvement of 77 per cent.

It operated 183 charters, ferrying more than 2,500 tonnes of essential cargo to 129 countries during the pandemic.

Etihad also took delivery of two new Boeing 787 Dreamliners in 2020, bringing the total fleet count to 103 aircraft. With 39 Dreamliners in total, Etihad is one of the world’s largest operators of this aircraft.

It also took the decision last year to ground Etihad’s fleet of 10 A380s “unless demand grows and there is sufficient appetite to reassess their viability.”

Read: Etihad grounds entire A380 fleet; will commence Abu Dhabi-Tel Aviv daily flights from March 2021

At the end of 2020, the airline operated to 50 passenger and seven cargo destinations from Abu Dhabi, representing approximately 35 per cent of its pre-Covid capacity.