The Emirates Group has announced a 74% fall in revenue AED 13.7 billion (US$ 3.7 billion) for th half-year results for its 2020-21 financial year, with a net loss of AED 14.1 billion (US$ 3.8 billion) after last year’s profit of AED 1.2 billion (US$ 320 million).
Emirates suspended passenger flights for eight weeks between April and May due to the COVID-19 pandemic, which caused the dramatic revenue decline.
The airline revenue was down 75% to AED 11.7 billion (US$ 3.2 billion), and posted a loss of AED 12.6 billion (US$ 3.4 billion) after a half-year profit of AED 862 million (US$ 235 million) for the same period last year. Revenue was mainly supported by strong cargo business.
Dnata revenue fell 67% to AED 2.4 billion (US$ 644 million), with a loss of AED 1.5 billion (US$ 396 million) after last year’s profit of AED 311 million (US$ 85 million), reflecting the impact of COVID-19 across all dnata business units globally. The loss includes impairment charges of AED 689 million (US$ 188 million).
The Group’s cash position on 30 September 2020 stood at AED 20.7 billion (US$ 5.6 billion), compared to AED 25.6 billion (US$ 7.0 billion) as at 31 March 2020.
“We began our current financial year amid a global lockdown when air passenger traffic was at a literal standstill. In this unprecedented situation for the aviation and travel industry, the Emirates Group recorded a half-year loss for the first time in over 30 years,” said Sheikh Ahmed bin Saeed Al Maktoum, Chairman and Chief Executive, Emirates Airline and Group. “As passenger traffic disappeared, Emirates and dnata have been able to rapidly pivot to serve cargo demand and other pockets of opportunity. This has helped us recover our revenues from zero to 26% of our position same time last year.
Sheikh Ahmed added that he expects a “steep recovery in travel demand once a COVID-19 vaccine is available, and we are readying ourselves to serve that rebound”.
He confirmed that the group has been able to tap into its strong cash reserves, and benefitted from a US$2 billion equity injection from its shareholder.
The Group’s has reduced its employee count by 24% to 81,334 as of 30 September 2020.
During the first six months of 2020-21, Emirates retired three older aircraft from its fleet as part of its long-standing strategy to improve overall efficiency, minimise its emissions footprint, and provide high quality customer experiences.
Emirates gradually restarted scheduled passenger operations on 21 May. By 30 September, the airline was operating passenger and cargo services to 104 cities.
Overall capacity during the first six months of the year declined by 67% to 9.8 billion Available Tonne Kilometres (ATKM) due to a substantially reduced flight programme over the past months, including the suspension of passenger flights at Dubai international airport for 8 weeks. Capacity measured in Available Seat Kilometres (ASKM), shrunk by 91%, whilst passenger traffic carried measured in Revenue Passenger Kilometres (RPKM) was down by 96% with average Passenger Seat Factor falling to 38.6%, compared with last year’s pre-pandemic figure of 81.1%.
Emirates carried 1.5 million passengers between 1 April and 30 September 2020, down 95% from the same period last year. The volume of cargo uplifted at 0.8 million tonnes has decreased by 35% while yield has more than doubled by 106%.
Emirates operating costs reduced by 52% against the overall capacity decrease of 67%. Fuel costs were 83% lower compared to the same period last year. This was due to a decrease in oil prices (down 49% compared to same period last year), as well as a 76% lower fuel uplift from substantially reduced flight operations during the six months period up to end of September. Fuel, which was the always the largest component of the airline’s cost in past reporting cycles, only accounted for 11% of operating costs compared with 32% in the first six months of last year.
Despite the significant drop in operations during the six months, Emirates’ EBITDA stood positive at AED 290 million (US$ 79 million) compared to AED 13.2 billion (US$ 3.6 billion) for the same period last year.