Emirates grows African revenue as profit soars

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Dubai-based airline Emirates delivered a 43 percent increase in its profit for the year to March. Flights on the carrier's three South African routes enjoyed an occupancy rate of 85 percent on average. Photo: Supplied

Johannesburg - Profit at Emirates, the only foreign carrier operating at all three of South Africa’s major airports, increased 43 percent to 3.3 billion United Arab Emirates dirhams (R9.4bn) for the year to March, the Dubai-based airline reported yesterday.

Profit for the larger group, which includes airline services arm Dnata, grew 32 percent to 4.1 billion dirhams.

Africa contributed 7.7 billion dirhams to Emirates’s revenue in the year under review, an increase of 15.1 percent year on year and representing 9.6 percent of total revenue.

The airline has 25 destinations in Africa and plans to start flying to Abuja and Kano in Nigeria from August. In South Africa, Emirates started flying to Johannesburg in 1995. It added the Cape Town route in 2008 and Durban in 2009.

Speaking on the sidelines of the inaugural World Travel Market Africa in Cape Town at the weekend, Fouad Caunhye, the regional manager of Emirates for southern Africa, said flights on its South African routes enjoyed an occupancy rate of 85 percent on average.

“There is a lot of weight that we project behind our operations in South Africa and there is a lot of momentum that we’d like to instil further.”

Emirates president Tim Clark said Africa, particularly west Africa, was still underserved and the carrier would pursue that business.

Caunhye said the planning team had been analysing African passenger flows and the launch of new destinations was based on both leisure and corporate travel expectations.

Outside Africa, Emirates will soon launch three passenger routes to Brussels, Chicago, and Oslo. Even with the launch of nine new destinations in the year to March, Emirates maintained its seat load factors at close to 80 percent.

In its annual report yesterday, the airline anticipated that by 2020, it would carry 70 million passengers a year and fly to more than 180 destinations.

The airline carried 44.5 million passengers during the year, up 13 percent year on year.

New passenger routes make up one aspect of its growth strategy. Another is new freighter routes. In the 2013/14 year, the company launched freighter operations to Nigeria, China and Ecuador. It added new aircraft for the freighter operations, taking its fleet to 12.

Commenting on the results, chairman and chief executive Sheikh Ahmed bin Saeed al Maktoum said the group would invest more in its business to ensure sustained profitability.

“Throughout 2013/14 the group collectively invested over 22 billion dirhams, the highest amount ever in one financial year. We know that to be a sustainable and profitable business we have to keep adding value to our stakeholders, our customers, partners and employees.”

The group took ownership of 24 new aircraft in the year.

Its operating margin rose to 5.2 percent from 3.9 percent a year before. This was Emirates’s 26th consecutive year of profitable operations.

Revenue grew 13 percent at both the airline and group level.

All the airline’s six regions had robust revenue growth, except west Asia and Indian Ocean, which added 3 percent to 8.3 billion dirhams. Europe’s revenue increased by 16.3 percent to 23.4 billion dirhams, east Asia and Australasia were up 14.1 percent to 23.8 billion dirhams while the Gulf and Middle East were up 16.6 percent to 8.3 billion dirhams. The Americas grew revenue 11 percent to 9.2 billion dirhams. - Business Report


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