Chairman blames fuel costs, “relentless downward pressure on yields” and uncertain economic and political realities.
Emirates has reported a dramatic 86% fall in first-half profits, as higher fuel costs and poor currency exchange rates such as a strong dollar hit earnings.
The world’s biggest long-haul airline made 226 million Emirati dirhams (€54 million) in the six months to September 30, compared to 1.7 billion for the same period a year earlier. Yet revenues rose 10% to 48.9 billion dirhams.
The first-half profits were the carrier’s lowest in a decade, and the Gulf airline warned of a tough six months ahead.
Higher fuel costs and currency devaluations in markets such as India, Brazil, Angola and Iran cost the Dubai-based carrier dearly, said chairman and chief executive Sheikh Ahmed bin Saeed al-Maktoum.
First-half profit for Emirates Group overall, which also includes the airport and travel services company dnata, fell 53% to 1.1 billion dirhams.
“We are proactively managing the myriad challenges faced by the airline and travel industry, including the relentless downward pressure on yields, and uncertain economic and political realities in our region and in other parts of the world,” Sheikh Ahmed said.
The cost of fuel for the airline rose 37% during the first half of the year compared to the same period last year.
On the positive side, Emirates set new passenger records in the first half, carrying just over 30 million passengers, up 3%.
The subsidiary dnata posted an 11% increase in profits, though this was partly attributable to the company’s sale of its stake in the Hogg Robinson Group earlier this year.