Amazing: Emirates Posts Higher Full Year Profit

With COVID-19 and subsequent travel restrictions leading to reduced passenger demand, it’s almost unbelievable that Emirates was able…

Amazing: Emirates Posts Higher Full Year Profit

With COVID-19 and subsequent travel restrictions leading to reduced passenger demand, it’s almost unbelievable that Emirates was able to report an overall profit for its 2019-2020 fiscal year. In fact, its main hub at Dubai International Airport was essentially shut down due to the UAE government’s decision to completely suspend passenger services in March. So given all of these factors, how did Emirates pull it off?

The UAE Government suspended all passenger traffic in March, crippling Emirates’ operations.
Photo: Getty Images

Impressive numbers from Emirates’ latest report

Releasing its 2019-2020 financials, we see some fairly impressive numbers coming from Emirates. Here are some of the highlights for the airline (not including the rest of the Emirates Group):

  • A profit of AED 1.1 billion ($288 million) despite continued “strong competitive pressure” and the unfavorable currency impact.
  • An increase of 21% over the previous year’s results.
  • A profit margin of 1.1% – although the airline notes that profit would have been higher without $300 million in losses due to “fuel hedge ineffectiveness” at year’s end.
  • The airline achieved an overall load factor of 78.5%, up from 76.8% the year before.
  • Emirates even took delivery of six brand new Airbus A380s over the course of the fiscal year.
  • Finally, Emirates ended the financial year with “a healthy level” of cash assets to the tune of AED 20.2 billion ($5.5 billion).
Emirates A380 parking
Much of the airline’s fleet currently remains parked in the desert in storage. Photo: Emirates

Examining the numbers

So how did Emirates pull off such an amazing accomplishment given the devastation of the last two to three months? There are some easy answers to this.

Firstly, Emirates’ fiscal year does not align with the calendar year. It actually begins on the first of April, which of course means it wraps up at the end of March. Thus, the significant success of the airline’s first three fiscal quarters was able to offset the devastation of the last few months. It should go without saying that the airline’s next fiscal year results will be quite different.

Next, the airline saw a decrease in its operating costs compared to the previous year. In fact, it posted a 10% reduction in these costs. Part of this was a decline in the average price of jet fuel by 9%. This, combined with reduced operations, meant that the airline spent 15% less on fuel. This is significant as this accounts for about one-third of the airline’s operating costs, which is the largest single operating expense.

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Emirates adapted to the drop in capacity by swapping its A380 services with its Boeing 777s. Photo: Emirates.

On the note of reduced operations, the airline’s total passenger and cargo capacity were down by 8%. The airline sees this as ‘successful capacity management’ in response to the crisis. After all, flying nearly-empty A380s to distant corners of the world while keeping full staff levels would be one quick way to lose money.

Finally, even as a drop in passenger demand was felt, Emirates SkyCargo services were still in demand. The airline reports that this accounts for 13% of the airline’s total transport revenue.

Conclusion

The fact that Emirates was able to post a net profit despite an absolutely devastating fourth quarter speaks volumes about its success during the three quarters prior. Before COVID-19 hit, the airline was expanding impressively with new routes and new partnerships with other carriers.

It should be made clear that this ‘fiscal year’ ended at the end of March. Therefore, the earnings report for its first quarter of 2020-21 is likely to be quite negative. However, unlike some airlines out there, it looks like Emirates will be able to weather this turbulent period without taking too much damage. The airline has drawn from existing lines of credit and raised additional liquidity through loans. Furthermore, it is in the process of securing more funding as a buffer.

Within a few months, as the UAE Government relaxes its own restrictions, we just might see the airline make a rebound faster than the competition.

What’s your reaction to Emirates’ numbers? Are you at all surprised or does it all make sense? Let us know in the comments.

Source : Simple Flying More   

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Iberia Offers COVID-19 Antibody Tests To Its Employees

In a move aimed at giving its employees the best possible protection against the coronavirus, Spain’s national flag…

Iberia Offers COVID-19 Antibody Tests To Its Employees

In a move aimed at giving its employees the best possible protection against the coronavirus, Spain’s national flag carrier announced it would implement a unique COVID-19 health plan. Designed in partnership with the Spanish hospital group Quirónsalud, Iberia will offer COVID-19 antibody tests to all its employees.

Iberia will test its staff for COVID-19 antibodies. Photo: Iberia

The move, announced in a press release on May 6, will allow all current staff and employees who are returning from leave to have a blood test to see if they have been infected with the coronavirus.

The COVID-19 testing is voluntary

The voluntary testing will be performed at Iberia health stations and on Quirónsalud premises. The blood tests will be done when an employee first returns to work, and then 15 and 30 days later.

Employees returning to work after sick leave due to COVID-19 or for those who have been in close contact with an infected person, a polymerize chain reaction (PCR) test will be administered.

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Iberia employees can find out if they have had the coronavirus. Photo: Iberia

Along with the testing measures, the IAG-owned airline is also considering installing thermal screening cameras to monitor employee temperatures.

Iberia will offer two COVID-19 tests

While you hear a lot about screening for the coronavirus, we thought we should explain the differences between an antibody test and a PCR test.

What is a COVID-19 antibody test?

An antibody test is designed to let you know if you have had (and recovered from) the coronavirus. The analysis shows whether the person being tested has had his or her immune system create antibodies to fight the virus. This test is not used to detect the coronavirus but to see if a person has had it and that they are now possibly immune. We say potentially immune because the coronavirus is a new disease, and it is not yet known if you can have it more than once.

What is PCR testing?

Unlike antibody testing, PCR tests are used to find the presence of an antigen by detecting viral ribonucleic acid (RNA) found in the genetic code of some viruses.  By using a nasopharyngeal swab (which looks like a very long Q-tip), the medical staff will collect nasal secretions from the back of the nose and throat. The swab is then tested to see whether a person has the coronavirus or not. While not a pleasant experience, the PCR test can show the presence of COVID-19, even if the person being tested is showing no symptoms associated with the disease.

Other measures Iberia has taken to battle the spread of the coronavirus include the flowing:

  • Aggressive measures for sanitizing aircraft, and all areas where people gather.
  • Campaigns to encourage social distancing, hand washing, and the use of PPE.
  • The issuing of PPE to all employees.
  • Staggered work times, separate entrances for arriving and leaving work, and more use of teleconferencing.

Madrid hit hard by COVID-19

With the majority of Iberia’s staff based in Madrid, the testing for COVID-19 will be a welcome addition to the safety measures already in place. Madrid has been the hardest hit city in Spain after football fans were infected during Champions League games in the Spanish capital and across cities in Italy.

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Iberia is based at Madrid-Barajas Adolfo Suárez Airport (MAD). Photo: Iberia

From tomorrow many places in Spain will enter what the government calls Phase 1 of the reopening, following one of the most restrictive lockdowns in Europe. Unfortunately for Iberia staff and others living in Madrid, it has been deemed too dangerous to relax the rules in the nation’s capital just yet.

What do you think about Iberia’s plan to test employees for COVID-19? Please let us know your thoughts in the comments section.

Source : Simple Flying More   

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