Business

Emirates, suffering from soaring fuel prices, posted a $ 1.1 billion loss

An aircraft operated by Emirates at Dubai International Airport in the United Arab Emirates.

Christopher Pike | Bloomberg | Getty Images

Dubai’s Emirates posted a loss of $ 1.1 billion in the year to March, $ 5.5 billion a year, despite soaring jet fuel costs that could overturn the initial recovery of the global aviation sector. Increased from the loss of.

The world’s largest long-haul airline lost on Friday with a 91% increase in revenue to $ 16.1 billion as travel blockages were eased from the worst of the coronavirus pandemic and airlines added capacity. Said it helped to shrink.

Sheikh Ahmed bin Said al-Maktoum, Chairman and Chief Executive Officer of the Emirates Group, said in a statement on Friday, “2021-22 will be the toughest year in the group’s history. It was about recovery. ”

“The group expects to return to the black in 2022-23, paying attention to headwinds such as rising fuel prices, inflation, new COVID-19 variants, and political and economic uncertainties. We are working hard to reach our goals. “”

The airline has resumed flights to 140 destinations by the end of March, but soaring fuel prices (more than 50% so far this year) continue to challenge. The aviation sector hit by a pandemic.. Emirates said fuel costs more than doubled to $ 3.8 billion as oil and jet fuel prices soared in recent quarters.

“It’s very difficult to decide where the price will stop or how far it will go down,” Sheikh Ahmed told CNBC. Tuesday interview When asked about the price of fuel. “It has had a huge impact on the airline’s business,” he added, adding that geopolitics and Russia’s invasion of Ukraine had a significant impact on fuel prices.

According to Emirates, fuel accounted for 23% of annual operating costs, compared to only 14% in 2020-21.

“The relatively recent reopening of key Asian markets is key to the recovery of Emirates,” independent aviation analyst Alex Machelus told CNBC. “As China’s blockade continues, challenges will remain as the fleet becomes more concerned in the delay of the Boeing 777 and the global crisis of living costs becomes more prominent. [in terms of impacts] To the airline this winter. “

Road to IPO

The Emirates Group, which includes Emirates and its aviation services business, Dnata, recorded an annual loss of $ 1 billion despite Dnata returning to the black. Group revenue increased 86% to $ 18.1 billion and Group cash balance improved 30% to $ 7 billion.

Sheikh Ahmed told CNBC that the group is now planning to reimburse the Dubai government for some of the nearly $ 4 billion emergency relief sent to airlines during the heyday of the pandemic.

“It was a lot of money spent,” he said. “If things continue like they do now … we can repay what the government has injected into the company.”

Emirates or its subsidiaries are in the midst of new speculation that they may be publicized and participated by the Dubai government. List of companies already specified Initial public offering as part of a push for local governments to solicit state-owned enterprises.

“I’m confident that in the future Emirates may hit the market and people will be able to buy stock,” Sheikh Ahmed said. “I don’t call that point,” he added, and couldn’t offer any further plans.

Dubai Airport, home of Emirates, Attracted 13.6 million passengers In the first quarter, according to new data released Thursday. Dubai Airport CEO Paul Griffith told CNBC that Dubai’s air passenger transport could reach pre-pandemic levels in 2024, a year earlier than previously expected, bringing a tailwind to Emirates through recovery. He said there was a possibility.

Emirates, suffering from soaring fuel prices, posted a $ 1.1 billion loss

Source link Emirates, suffering from soaring fuel prices, posted a $ 1.1 billion loss

Back to top button