Etihad Reports $14mn Net Profit

This is the first time that the UAE airline, started eight years ago, has recorded a profit.

Etihad Airways reported a net profit of $14 million for 2011, with revenues increasing 36 per cent to $4.1 billion from $2.98 billion in 2010. The results included earnings before interest, tax, depreciation, amortisation and rentals (EBITDAR) of $648 million and exceeded the airline’s 2011 target.

“This is an historic day for Etihad Airways,” said James Hogan, president and CEO of Etihad Airways. “Five years ago we said we would be profitable by 2011. Despite the global financial crisis, continued high oil prices, regional instability and natural disasters, we have delivered.”

“And we will aim for strong growth again in 2012, in spite of the tough global economic environment, with a passenger traffic target of 10 million and a corresponding increase in profits,” he said.

The airline made its first equity investment in another carrier – airberlin, in December 2011. “The airberlin deal will be our most important catalyst for growth in 2012. It has given us instant access to Europe’s largest travel market, and will have a major impact on revenues in 2012, with an expected contribution of up to $50 million,” said Hogan.

Etihad announced a second equity investment in Air Seychelles this year.

Hogan said that cost control had contributed significantly to the airline’s profit, with costs per available seat kilometre, excluding fuel, being cut by 4.6 per cent in 2011 and 16.6 per cent over the last two years, representing annual savings of more than $187 million.

“In 2012, we will add seven aircraft and have already announced plans to extend our network in Asia and Africa,” said Hogan. The carrier has so far raised $5 billion in external fleet financing, through a portfolio of 41 different financial institutions.