Emirates post record full-year profit

[Pieter C. 5]

Emirates posts record full-year profit, reveals interest in more A380s

 

Friday April 27, 2007

Emirates' star continues to rise, as evidenced by the record AED3.46 billion ($941.8 million) profit the parent company reported for the fiscal year ended March 31, representing a 23.5% increase over the prior year's profit of AED2.8 billion and based largely on the AED3.1 billion in net earnings contributed by the airline.

 

Emirates Group also includes Dnata and subsidiary companies. "For the third year running, pressure from fuel costs has softened our profits, while the delay on our A380 aircraft deliveries has meant that we have had to revisit our expansion plans," Chairman and CEO Sheikh Ahmed bin Saeed Al-Maktoum said. "In spite of these factors, the Group has continued to forge ahead. . .expanding our operations into new markets and adding capacity to existing markets offering the highest returns, innovating to attract and retain premium customers and keeping a close watch on unit costs."

 

Group revenue rose 28.4% to AED31.13 billion against a 29.3% lift in expenses to AED27.61 billion. Operating income increased 23.5% to AED3.63 billion. Emirates Airline's profit, up 25.1% from the previous fiscal year's AED2.48 billion, highlighted a period during which operating profit rose 25.9% to AED3.34 billion on a 29.5% gain in revenue to AED29.84 billion and a 30.2% increase in costs to AED26.68 billion. Its operating margin was down 0.3 point to 11.4%.

 

EK flew 77.95 billion RPKs during the 12 months, up 25.2% from the prior year. Capacity climbed 24.8% to 102.34 billion ASKs and load factor was up 0.3 point to 76.2%. It added 11 aircraft and six destinations and its fleet at year end numbered 102, including six 747 freighters on wet-lease. Overall yield increased 6.5% to AED2.16 and passenger yield rose 5.8%. Cost per ATK was up 6% to AED1.29.

 

At the carrier's briefing in Dubai yesterday, Al-Maktoum said negotiations with Airbus concerning A380 compensation should be completed next week and EK will be buying more of the type in the future. "We are talking with Airbus about ordering an additional small number of A380s. Maybe we will make an announcement this year," he told the press, adding that he is confident the first A380 will be delivered in August 2008.

 

President Tim Clark told ATW that the airline "easily could absorb" 5-15 more A380s, while Executive Vice Chairman Maurice Flanagan said the aircraft also would work well in a low-cost business model, which he said the company is considering "a little bit."

 

Clark expressed excitement about the A350 XWB. Emirates will be looking to replace around 50 aircraft by 2013, including some A330-200s, A340-300s, 777-200s and 777-300s. He said Airbus has added to the A350 "all the things we have asked for," and that the airline hopes to present its choice between the 787 and A350 to Al-Maktoum this summer. It is looking to order 60-100 aircraft and operate a fleet of 161 planes by 2010.

 

 

Quite impressive

 

[Imran K. 0]

Congrats!

 

Higher Profits = Higher Bonus = More Allowance

[BC Tam 2]

..... while Executive Vice Chairman Maurice Flanagan said the aircraft also would work well in a low-cost business model, which he said the company is considering "a little bit." .....

Now that is innovative thinking !

[Samsyuri 0]

Congrats!

Higher Profits = Higher Bonus = More Allowance

 

Are you applying Advanced Mathematics here?? .. Very nice equation

[Imran K. 0]

Are you applying Advanced Mathematics here?? .. Very nice equation

 

Yup...super advanced mathematics...

[Pieter C. 5]

MAS has sold a resort recently, but Emirates is building one :

 

Emirates Plans USD$253 Mln Seychelles Resort

 

May 1, 2007

Dubai-based Emirates, the largest Arab airline, said it will invest USD$253 million building a resort in the Seychelles, its second foreign hotel development and its biggest.

 

Emirates, which this year got Australian approval to build a hotel resort outside Sydney, aims to complete the 472 room Seychelles site at Mahe in 2010, the airline's president, Tim Clark, told reporters in Dubai.

 

"This is just the beginning," Clark said.

 

Emirates is considering locations in India, Sri Lanka and east Africa to build similar hotel resorts, capitalizing on its expanding network of destinations that stretch from Sydney to New York.

 

The Dubai government-owned carrier expects to recoup its Seychelles investment within eight to nine years, and achieve a 17 percent rate of return, Clark said.

 

Emirates is spending AUD$85 million (USD$70.5 million) on its Wolgan Valley resort in the Blue Mountains west of Sydney.

 

Emirates has a minority stake in Sri Lankan airlines which it manages.

 

(Reuters)

 

[Pieter C. 5]

Emirates Agrees Airbus A380 Damages; Orders More

 

May 7, 2007

Dubai-based Emirates, the largest customer for the Airbus A380, said it had agreed compensation with the European planemaker over the delayed delivery of the world's largest passenger aircraft.

 

"The compensation deal has been concluded," spokesman Mike Simon said.

 

Emirates Chairman Sheikh Ahmed bin Saeed al-Maktoum said on April 26 that a deal would be concluded within a week.

 

Simon declined to give details of the agreement.

 

Emirates has ordered four more A380 aircraft, taking its total orders to 47, Airbus said on Monday. Simon said the purchase was not linked to the compensation.

 

Emirates President Tim Clark said last month the government-owned carrier may order between 10 and 15 more A380s to meet rising passenger demand through its Dubai hub to Europe and Asia.

 

Emirates will take delivery of its first A380 in August 2008, a delay of almost two years. The largest Arab airline had expected to have 18 of the 555-seat planes by then, before Airbus announced delays due to technical problems.

 

(Reuters)

 

[Pieter C. 5]

Emirates: Simplification, efficiency key to fleet expansion

 

Thursday May 10, 2007

Emirates is focused on simplification and fuel efficiency as it enters the final lap of what will be a major fleet expansion program taking it to 2020.

 

On the shopping list are more 777s, A350-900s/-1000s, 787s and 747-8Is. President Tim Clark told ATW prior to his trip to Seattle this weekend that the airline is "focused on fuel efficiency" even if it means a slight drop in capability.

 

Another driver of the planned mix is the completion of Dubai's second airport at Jebel Ali. It will have six runways and is expected to be fully operational in 2014, but any delay will force EK into bigger aircraft, he said.

 

Clark will be working with Boeing to define where the 787-10X and 747-8I sit on range/payload while his wish list contains a lighter 777-300ER, an aircraft he describes as "the champion" of the Emirates fleet. He warned that "if Airbus's promises on the A350-1000 stack up," it will offer stiff competition to the -300ER. "Sure it will not lift as much but it will burn a great deal less fuel," he told this website. He is not interested in the mooted 777-400ER; "I just want a lighter 777-300ER for better fuel burn."

 

He expressed enthusiasm for the 787's composite barrel and low maintenance overhead and said he is keen to see if Boeing has made progress on the 787-10X's performance. He did not rule out a buy of the smaller 787-9, which would be dependent upon when Jebel Ali opens. Dubai-Los Angeles capability remains an issue on the 747-8I, but Clark said he still sees a niche for the jumbo at EK, which already has ordered the freighter version.

 

Turning to Airbus, Clark debunked rumors of an impending order for 100 A350s and 60 A330s. "Sure, if we go the A350 route we will need some interim lift, and the A330 would fit that bill, but no decisions have been made," he said. He added that he is unconvinced about Airbus's intention to stick with composite panels on an aluminum frame for the A350. There are many at the manufacturer who want to go the all-composite route, which he believes is the future.

 

He also reiterated that the four A380s ordered last week were not part of the compensation package for delayed deliveries. "This is a new order for aircraft we need and we were able to take some delivery slots that opened up," he said. EK is confident that Airbus has sorted out its A380 problems and he said that once it is in service, airlines will clamor to get onboard: "The seat-mile costs are stellar."

 

 

[Ashraf 0]

Emirates Hits New High with Record Half Year Results

 

• AED 3.4 billion (US$ 925 million) net profits, up 351 percent

• Significant business growth with 15.5 million passengers carried, up 17.3 percent

• Passenger seat factor at 81.2 percent, the highest ever for a first six month reporting period

• 62 new aircraft ordered to further drive airline’s growth

 

 

DUBAI, U.A.E. - 1 November 2010 - Emirates produced a net profit of AED 3.4 billion (US$ 925 million), for the first six months of its current financial year ending 30th September 2010. This represents an outstanding 351.2 percent increase compared to AED 752 million (US$ 205 million), for the same period in 2009.

 

 

 

“The results for the first half of the 2010-11 financial year are incredibly robust, and reflect Emirates’ success in growing customer demand, supported by investment in new aircraft, products and customer service. We continue to invest our profits in growing the business and our healthy financial position enables us to successfully meet all of our financial commitments and raise financing for future aircraft deliveries. Our strong position today is reflective of our ability to adapt, returning us to a vigorous period of growth. With 62 new state-of-the-art aircraft ordered in the first half, we remain well positioned to capitalise on this growth,” said HH Sheikh Ahmed bin Saeed Al-Maktoum, Chairman and Chief Executive, Emirates Airline and Group.

 

 

 

Highlighting a positive shift in the aviation sector, Emirates airline has seen a marked increase in passenger traffic, carrying 15.5 million passengers and recording a strong passenger seat factor at 81.2 percent, the highest ever for a first six month reporting period. Premium class seat factors have also risen by 2.6 percentage points, reflecting an encouraging change in the global economic outlook.

 

 

 

Emirates SkyCargo has also seen a strong half year performance across the network, posting an increase in revenue of 48.4 percent to AED 4.4 billion, with cargo tonnage up by 23.7 percent to 897 thousand tonnes, compared with 725 thousand tonnes for the same period last year. SkyCargo continues to post steady revenue growth contributing around 17.8 percent of the airline’s transport revenue.

 

 

 

Emirates’ cash balances grew to AED 12.5 billion (US$ 3.4 billion) at the end of September, a significant improvement of 18.5 percent or AED 1.9 billion (US$ 529 million) when compared to 31st March 2010. This increase in the cash balance was achieved after settling capital outflows of AED 2.4 billion, primarily towards aircraft pre-delivery payment and other aircraft assets. During the first half, the airline has also successfully raised financing of AED 4.6 billion (US$ 1.3 billion). Fuel continues to be the most significant expenditure for the airline with operating costs up 22.6 percent to AED 23 billion (US$ 6.3 billion).

 

 

 

“Investing in the future and adapting our operations when required is an integral part of our corporate strategy. This flexibility affords us the option of increasing passenger and cargo services on high demand sectors. By following these positive spikes in regional economies we have been able to maximize the use of our fleet to further stimulate revenue,” added Sheikh Ahmed.

 

 

 

Emirates’ revenue, including other operating income, of AED 26.4 billion (US$ 7.2 billion) for the half-year represented a strong growth of 35.5 percent compared to revenue of AED 19.5 billion (US$ 5.3 billion) during the same period last year.

 

 

 

Fueling growth in the aviation and tourism industry globally, Emirates has launched six new destinations since April this year - Amsterdam, Prague, Madrid, Dakar (passenger operations) in addition to Almaty and Bagram (freighter only operations). Existing markets have also been given a boost with increased frequencies and capacity - through larger aircraft.

 

 

 

Building on its current A380 network Emirates launched two new A380 destinations, Manchester and Beijing. The A380 continues to be popular in all destinations that it serves and has become the airline’s flagship in terms of passenger comfort, innovation, operating and environmental efficiency and revenue generation.

 

 

 

Emirates continued to invest heavily in its product in the first half with the delivery of six new wide-body aircraft, five Airbus A380s and one Boeing 777 and the opening of a new dedicated lounge at Shanghai Pudong International Airport. A further two new aircraft are scheduled to be delivered before the end of the financial year (31 March 2011).

 

 

 

Capacity measured in Available Seat Kilometres (ASKM), grew by 13.9 percent, whilst passenger traffic carried measured in Revenue Passenger Kilometres (RPKM) was up 19.4 percent.

[Phil M. 0]

Its nice when they get mega fuel subsidy!!!!

[KK Lee 5]

Emirates sees profits soar on higher passenger numbers

 

Emirates has reported a 52% rise in annual profits, boosted by a big increase in passenger numbers.

 

The Dubai-based airline made a net profit of 5.4bn dirhams ($1.5bn; £918m) in the year to 31 March.

 

Passenger numbers at the airline were up 14.5% to 31.4 million.

 

Emirates' increased profits came despite the political instability seen across the Middle East since January, and higher oil prices.

 

"We had a year full of growth and expansion," said chairman and chief executive Sheikh Ahmed bin Saeed Al-Maktoum.

 

He added that political instability in the Middle East, and strong fuel prices, remained a challenge.

 

Emirates revealed that the upheaval across the region had caused it to drop plans for a bond sale to fund expansion, as it had made the yield - or interest - it would have had to offer too high.

 

It said it would wait instead for pricing conditions to improve.

 

The airline's revenues for the year rose 25% to 54.4bn dirhams.

 

The carrier currently operates 153 aircraft to 111 destinations in 66 countries.

 

http://www.bbc.co.uk/news/business-13344084

 

 

Net profit margin of 10% is exceptional. Couldn't recall MH ever had this margin.

[Mohd Azizul Ramli 2]

The Dubai-based airline made a net profit of 5.4bn dirhams ($1.5bn; £918m) in the year to 31 March.

 

Net profit margin of 10% is exceptional. Couldn't recall MH ever had this margin.

This reminds me of our last discussion when MH released its full year 2010 result, where its net margin was only like 2%:

 

If you look at the two companies' results, they tell very different stories. MH does not look very efficient.

 

Turnover for Y/E 31 Dec 2010

AirAsia RM 3,992,722,000

Malaysia Airlines RM 12,980,447,000

 

Profit Before Tax

AirAsia RM 1,099,299,000 (27.53% of Turnover)

Malaysia Airlines RM 282,036,000 (2.17% of Turnover)

 

Profit After Tax

AirAsia RM 1,066,877,000 (26.72% of Turnover)

Malaysia Airlines RM 237,346,000 (1.83% of Turnover)

 

Malaysia Airlines very nearly went into a loss situation - its cost of sales exceeded revenue! Only other operating income came in to spare it some blushes. MH really either needs to increase its fares or reduce its cost of sales.

Yes, MH very nearly scraped past positive margin. but the above comparison is wrong. At the same ASK, the LCC makes much higher margin compared to a FSC. No airline in the world even SQ or LH can make the airasia margin, its just the rules of business.

 

Maybe compare with SQ figures then you'll have a realistic figure of what MH margins should be.

Since you insist, here are Singapore Airlines' numbers. However, their financial year ends on 31 March. So this is a 9 month period.

 

Turnover - S$ 10,938.0m

Profit before tax - S$ 1,207.3m (11.04%)

Profit after tax - S$ 964.4m (8.82%)

 

These margins are still a lot healthier compared to MH's.

SQ's 9 months net margin (of 8.82%) is quite comparable to EK's full year 10%. I guess everything is possible if you have the drive, will and discipline to do so, whether you are a LCC or legacy carrier.

 

A certain MH staff claimed that they work using only 1 hand because the other hand is being tied at their back. I suspect MH is going to report a Q1 2011 loss very soon.

[Ashraf 0]

http://media.bloomberg.com/bb/avfile/rBjyE8fR5E18

 

usd1.5 or usd1.6billion ?

[Lock SH 0]

............. and the best part is ..... 12 weeks bonus to all EK's employees ..........

 

 

[Mohd Azizul Ramli 2]

Yes, that was the Facebook status of a few of my friends today. Question: why they termed it as '12 weeks' instead of '3 months' which is more common when we talk about bonus?

[Pieter C. 5]

Wow, 4 years old topic resurrected !!!

 

3 months bonus for EK-staff: very well treatment by EK management...

[flee 5]

Yes, that was the Facebook status of a few of my friends today. Question: why they termed it as '12 weeks' instead of '3 months' which is more common when we talk about bonus?

I suspect that this is a very shrewd move by the management - it saved 1 week of bonus payments! Looks like Emirates leave no stone unturned when it is looking for cost savings!

[Sri Ramani K. 0]

3 months bonus for EK-staff: very well treatment by EK management...

 

3 months is nothing Uncle. One LCC also managed to pay out over 3 months of bonus to their staff.

[Mohd Azizul Ramli 2]

SQ's 9 months net margin (of 8.82%) is quite comparable to EK's full year 10%. I guess everything is possible if you have the drive, will and discipline to do so, whether you are a LCC or legacy carrier.

My favourite spy forwarded me a 26 pages analyst report from Deutsch Bank AG Hong Kong which was issued out yesterday. According to the report, SQ is going to announce its full year 2010/2011 result tomorrow. Let see how the airline fares for the remaining 3 months period of its financial year and whether there'll be a bonus payout to its employees or not.

 

From the report as well, it was mentioned that AK will announce its Q1 2011 result on 24 May 2011. Can't wait to peruse the financial statements and operating statistics.

 

The report gives a market forecast of several airlines 'to look out for' in the Asia Pacific region including heavyweights Singapore Airlines, Cathay Pacific, Air China, China Southern, Thai Airways and Korean Air amongst other. AirAsia is one of only 2 LCCs featured in the report and AK was featured prominently and positively. AK also emerged as the bank's top 3 'Top Pick' counters (behind Air China and China Eastern).

 

Malaysia Airlines was not mentioned at all in the 26 pages report.

[flee 5]

Many years ago I was a foolish patriot to buy MH shares. Lost money on them. More recently I bought AK shares and made money. Now I am looking forward to owning some D7 shares as well, and hopefully make money!

 

Yes, analysts will definitely only pick on investments that yield the best returns on investment. So they are naturally excited about AK and other profitable airlines like SQ and EK.

[Mohd Azizul Ramli 2]

More recently I bought AK shares and made money. Now I am looking forward to owning some D7 shares as well, and hopefully make money!

 

Yes, analysts will definitely only pick on investments that yield the best returns on investment. So they are naturally excited about AK and other profitable airlines like SQ and EK.

So flee you can expect a dividend from your AK investment this year following their recent announcement. But I am quite sure EK (Emirates) is still not listed at the Dubai Stock Exchange. I think there was a news before about their IPO being called back.

[Mohd Azizul Ramli 2]

A certain MH staff claimed that they work using only 1 hand because the other hand is being tied at their back. I suspect MH is going to report a Q1 2011 loss very soon.

My suspicion that MH is going to report a Q1 2011 loss is confirmed by Maybank Investment Research in their 7 pages analyst report issued out today. The fact that MH is extremely slow in uploading its operational statistics for the month of March and April 2011 in its Investor Relation page on its website further make me believe that they purposely don't want to reveal it on time, in view that it might have a negative effect on their share price. MH will release its Q1 2011 result on Wednesday, 25 May 2011.

 

The tide has turned. MAS will release its 1Q11 results on 25 May. 1Q11 is expected to be loss-making due to the impact of 35% higher fuel price and some impact from the MENA civil unrest and Japanese natural disasters. We are concerned with the volatility of fuel and the increasing evidence that there is an oversupply of capacity in the industry.

 

 

From the report as well, it was mentioned that AK will announce its Q1 2011 result on 24 May 2011. Can't wait to peruse the financial statements and operating statistics.

 

The report gives a market forecast of several airlines 'to look out for' in the Asia Pacific region including heavyweights Singapore Airlines, Cathay Pacific, Air China, China Southern, Thai Airways and Korean Air amongst other. AirAsia is one of only 2 LCCs featured in the report and AK was featured prominently and positively. AK also emerged as the bank's top 3 'Top Pick' counters (behind Air China and China Eastern).

 

Malaysia Airlines was not mentioned at all in the 26 pages report.

AK will release its Q1 2011 result tomorrow. Maybank Investment Research also released a preliminary analyst report today leading to the announcement.

 

Turbulence overshadowing strong 1Q. We expect AirAsia’s 1Q11 to be very strong, but we are concerned with the surge in oil price volatility and the increasing evidence that there is an oversupply of capacity in the industry. We estimate the Group’s 1Q11 core net income to be RM246.7m, a growth of 105% YoY.

However, the research house predicted that AK will record a negative profit growth in Q2 and Q3 2011 due to high fuel prices.

 

Challenging outlook in 2Q-3Q. The volatility of jet fuel has soared and this is a challenge that no airline is immune to. AirAsia has re-instated fuel surcharge to offset some of the impact of higher jet fuel. This is positive, but we think the impact will only be seen late 3Q as bulk of AirAsia’s tickets for 2Q-3Q have already been sold without any fuel surcharge embedded in them. We don’t foresee AirAsia being able to achieve profit growth in 2Q-3Q.