Emirates Posts 72% Drop In 2011 Profit

The airline said that despite an increase in revenue, its profit was hit by rising fuel costs and unrest in the region.

Emirates airline posted a full year 2011 profit of Dhs1.5 billion ($409 million), a 72 per cent decline compared to the Dhs5.4 billion ($1.5 billion) it made last year.

The airline’s revenues grew 14.9 per cent year-on-year to reach Dhs62.3 billion ($17 billion), but profits declined because of high fuel costs, the carrier said in a statement.

Emirates’ fuel bill increased by 44.4 per cent over the last year to reach Dhs24.3 billion ($6.6 billion), pushing up operating costs by 24 per cent.

“In addition to the cost of fuel, Emirates had an operationally challenging year with the political unrest across the Middle East and North Africa affecting flight schedules,” the airline said.

Emirates’ Passenger Seat Factor stood at 80 per cent, and the airline carried 34 million passengers last year, an increase of eight per cent from 2010.

The carrier received 22 new aircraft during the year and launched 11 new destinations in 2011-12, with Rio de Janeiro, Buenos Aires, Seattle and Dallas-Fort Worth all launching between January and March 2012.

“Managing volatile exchange rates, coupled with our highest ever fuel bill has required immense tenacity,” Sheikh Ahmed bin Saeed Al Maktoum, chairman and CEO of Emirates said in the statement.

“We move into the new financial year with cautious optimism, navigating our way through the difficult economic climate with a clear vision for our continued success,” he said.

Emirates, which flies to more than 120 destinations across the globe, has announced four new routes this year including Ho Chi Minh City, Barcelona, Lisbon and Washington D.C.

During a recent interview, Sheikh Ahmed also said that the airline may introduce more new routes in the US.

“The bilateral (agreements) between the UAE and the US are very much open. We always see more new destinations to be opened,” he told The Associated Press.

“I think one day we’ll fly to Chicago. Fly one day to Florida? Yes. Flying to other destinations? Yes, why not? I think any big cities within the US are a possibility,” he said.

Sheikh Ahmed also said that the carrier had not ruled out the possibility of acquiring other airlines.

“I think I always say, if it is the right time, it [full or partial acquisitions of airlines] is possible,” he said.

“It’s opportunity, it’s timing, it’s [a question of] where. Is it going to be something that in the long term, short term, is a benefit to the business that we’re in,” he said.