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Air Arabia Q2 profit surges 31% despite ME challenges
Abdul Basit / 8 August 2012
Air Arabia said on Tuesday it recorded a 31 per cent increase in net profit in the second quarter of the year over same period last year despite political challenges in the Middle East.
The low-cost carrier declared a net profit of Dh66 million for June quarter compared to Dh51 million in same quarter last year.
The Sharjah-based carrier’s financial results beat analyst forecasts as two analysts had forecast profit of Dh52.5 million and Dh51 million in a Reuters’ poll.
The budget airline’s turnover for the second quarter of 2012 stood at Dh729 million, an increase of 23 per cent compared to Dh592 million reported in the same period of 2011.
“Air Arabia’s expansion strategy and efficient operating model continue to be reflected in the airline’s financial performance, amidst continues political challenges that the region is witnessing” said Shaikh Abdullah bin Mohammad Al Thani, Chairman of Air Arabia. “In the second quarter of this year, our proven ability to identify and capitalise on underserved served routes continued to reap enormous benefits,” Al Thani added.
The airline welcomed onboard 1.3 million passengers in the second quarter of 2012, an increase of 15 per cent compared to the same period last year. Air Arabia’s average seat load factor – or passengers carried as a percentage of available seats – for the three months ending June 30, 2012, stood at an impressive 85 per cent, up 3 per cent on the same period last year.
“When you look at the rise in passenger figures matched with a huge 85 per cent load factor, Air Arabia has done a fantastic job of maintaining and expanding market share, despite fears of a wider GCC impact due to instability in places like Egypt and Syria,” Saj Ahmad, chief analyst at London-based StrategicAero Research, told Khaleej Times. For the six months ending June 30, 2012, Air Arabia reported a net profit of Dh115 million, an increase of 22 per cent compared to Dh94 million in the corresponding period in 2011.
The carrier’s turnover for the first half of 2012 stood at Dh1.3 billion, an increase of 22 per cent compared to Dh1.1 billion reported in the same period of 2011. The airline welcomed onboard 2.5 million passengers in the first half of 2012, an increase of 11 per cent compared to the same period last year.
“Looking ahead, we are confident about the outlook of low cost travel in the region. As we continue expanding into new markets and adding new services, we look forward to providing best-in-class services for our customers throughout the year and beyond,” Al Thani said.
Air Arabia added two new routes in the first half of 2011, with Taif in Saudi Arabia and Salalah in Oman bringing the airlines global network to 75 destinations. Additionally, the airline increased the frequency of flights to Nagpur in India, Dammam and Riyadh in Saudi as well as to Kuwait.
The first half of 2012 also saw the delivery of three new aircraft from Airbus as well as Air Arabia completing its first maintenance check with its new hangar facility.
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