11 November 2008

Emirates profits slump by 88%

DUBAI - Emirates saw half-year profits plunge by 88% in the half year ending September 30.

The UAE carrierââ¬â¢s net profit in the six month was just US$77 million against US$643 million for the same period last year.

The decline was blamed on the impact of the record fuel prices earlier this year.

Fuel spend more than doubled from $1.1 billion to $2.5 billion.

The results from the Dubai-based carrier follow British Airways showing a half-year profits decline of more than 90% .

Crude oil prices averaged $122 per barrel for the first half of the financial year, up from an average of $67 for the same period last year, Emirates said.

Emiratesââ¬â¢ overall fuel costs were higher than budgeted by $469 million.

The airlineââ¬â¢s chairman and chief executive Sheikh Ahmed bin Saeed Al-Maktoum said, ââ¬ÅâœThe first half of the year has been very tough for the airline industry, with record fuel prices forcing many carriers to shut shop or consolidate.

ââ¬ÅâœEmirates has worked hard to manage the impact of high fuel prices on our unit costs, while continuing to grow our business and provide our customers with a quality product and service.ââ¬~

He added: ââ¬ÅâœRecent events show that only the most efficient businesses will survive and prosperââ¬~, claiming the carrier was in a strong position to weather the credit crunch and future challenges.

Sheikh Ahmed said, ââ¬ÅâœOur business fundamentals are solid, and providing there is no further fall-out from the current global financial situation, we anticipate a robust second half of the financial year.ââ¬~

Passenger traffic was up 11% and passenger yield increased by 20% in the half year.

by Phil Davies

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