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Emirates airline annual profit falls for the first time in 5 years
[NEW YORK] Emirates, the Middle East's largest airline, reported a decline in annual profit on Thursday for the first time in five years.
The Dubai-based airline saw net profit fall 82 per cent to 1.3 billion dirhams (S$500 million) as passenger yield - a measure of how much money an airline makes per passenger per kilometre flown - followed a slowdown in demand for travel.
It is the first time the airline has reported a decline in annual profit since the fiscal year ending March 31, 2012.
"We remain optimistic for the future of our industry, although we expect the year ahead to remain challenging with hyper competition squeezing airline yields, and volatility in many markets impacting travel flows and demand," Emirates Chairman Sheikh Ahmed bin Saeed al-Maktoum said.
The airline's revenue was flat at 85.1 billion dirhams.
Emirates said the "relentless rise" of the US dollar in its key market cost the airline 2.1 billion dirhams in revenue.
Its fuel bill increased 6 per cent on the year to 21 billion dirhams and made up 25 per cent of its operating costs compared with 26 per cent last year.
Despite a series of what it called "destabilising events," including Britain voting to leave the European Union and a number of restrictions on travel from the Middle East by US President Donald Trump, Emirates recorded an 8 per cent rise in passengers carried to 56.1 million. Its load factor - or number of seats filled - fell 1.4 percentage points to 75.1 per cent.
The airline increased its total seat capacity by 10 per cent during the year.
The world's biggest customer of the Airbus A380 superjumbo said profit for the wider Emirates Group, which includes airport and travel services arm Dnata, fell 70 per cent to 2.5 billion dirhams.
Emirates said it would not pay a dividend to Investment Corporation of Dubai, the state investment vehicle which owns the airline and stakes in other Dubai companies. It paid 2.6 billion dirhams for the previous year.