Emirates’ profits fall on ‘crippling’ fuel costs

Emirates, the Dubai based airline, is still making huge profits.  However, its profit for 2011/12 was $629 million, down from $1.6 billion in the previous year.  Emirates says th is is due to fuel costs.  The airline transported about 31.4 million passengers in 2010, and says this was up to about 34 million passengers in 2011.  Wikipedia data look as if Emirates is the global airline with the  highest level of passenger kilometers, implying it does particularly long haul routes. Which would explain why their fuel bill was $6.6 billion last year.  But Delta Air Lines’ fuel bill was approaching $12 billion.

 

 

10 May, 2012
 by Rob Gill  (ABTN)
 

Emirates Group has seen its profits fall by 60% due to the “crippling cost of fuel” despite record-breaking revenue across its businesses.

The Dubai-based company, which includes the Emirates airline, made a net profit of $629 million for the 2011/12 financial year which runs to the end of March – down from $1.6 billion in the previous year.

This was despite group revenue rising by 17.8% to $18.4 billion during the previous year.

The airline saw its profits fall by 72% to $409 million in 2011/12 as it was hit by a 44.4% rise its fuel bill to $6.6 billion over the year. [Delta Air Lines’ fuel bill was around $12 billion in 2011    link  ]

The rise in fuel costs was partially offset by a 14.5% increase in revenue to $17 billion at airline which broke through the 34-million passenger barrier for the first time.

“Emirates bore the brunt of the crippling cost of fuel for nearly one year, before reluctantly introducing a fuel surcharge on all tickets,” said the company in a statement.

Sheikh Ahmed bin Saeed Al Maktoum, chief executive of Emirates Airline and Group, said the airline had recorded its 24th consecutive year of profit despite this increase in costs.

“Maintaining an upward growth trajectory is an achievement that belies the industry norm,” he added.

“Throughout the 2011/12 financial year, the group has collectively invested close to $3.8 billion) in new products. This investment has garnered new customers and increased our international presence.

“Successful business growth is not a matter of luck, it is the result of sustained and calculated investment. Every dirham that we earn is strategically ploughed back into our business and it is this foresight that has allowed the group to maintain such strong and consistent profitability.”

Emirates Group also includes air services provider Dnata which purchased UK online leisure travel agency Travel Republic earlier this year.

 

http://www.abtn.co.uk/news/1017343-emirates-profits-fall-crippling-fuel-costs

 

In the financial year 2010/2011, Emirates carried 31.4 million passengers and 1.8 million tonnes of cargo.

 

 


 

Emirates is not in the top 10 airlines, by the number of passengers flown in 2010. But strangely it comes out as the top airline for international passenger kilometers, indicating that its flights are all very long haul.

 

http://en.wikipedia.org/wiki/World%27s_largest_airlines

Scheduled international passenger-kilometers flown

Rank Airline 2010 (millions) 2009[14]
(millions)
2008
(millions)
1 United Arab Emirates Emirates 143,660 118,284 100,672
2 Germany Lufthansa 124,614 118,264  
3 United States Delta Air Lines 119,055 70,725  
4 France Air France2 115,837 116,711  
5 United Kingdom British AirwaysRepublic of Ireland Aer Lingus 103,095 109,402 113,075
6 Hong Kong Cathay Pacific4 87,332 81,086 83,542
7 Singapore Singapore Airlines3 84,911 81,552 93,626
8 Republic of Ireland Ryanair 81,890    
9 United States American Airlines 80,531 76,301 80,809
10 Netherlands KLM 73,472 71,972  

 

 

Scheduled domestic passenger-kilometers flown

 
Rank Airline 2010
millions>[13]
2009
(millions)[14]
2008
(millions)[14]
2007
(millions)
1 United States Delta Air Lines 147,935 91,179 97,923 103,008
2 United States Southwest Airlines 125,581
3 United States American Airlines 121,350 120,638 131,178 141,437
4 China China Southern Airlines1 95,609 81,850 71,584 69,367
5 United States United Airlines 91,938 93,362 102,779 114,224
6 United States US Airways 70,553 71,266 77,054 52,018
7 United States Continental Airlines 65,162 66,409 69,814 74,126
8 China Air China 54,284 46,159 38,761  
9 China China Eastern Airlines 49,959 43,922  
10 United States JetBlue 38,863
 
 

Scheduled passengers carried

Rank Airline 2011 2010 2009 2008 2007[1] 2006[2] 2005
1 United States Delta Air Lines 163,838,348 162,614,714 161,049,000 106,070,000 72,900,000 73,584,000 86,007,000 [3]
2 United States United Airlines 141,799,000 145,550,000 81,421,000 86,412,000 68,400,000 69,265,000 66,717,000 [4]
3 United States Southwest Airlines 135,274,464 130,948,747 101,339,000 101,921,000 101,911,000 96,277,000 88,380,000 [5]
4 Germany Lufthansa1 106,335,000 90,173,000 76,543,000 70,543,000 66,100,000 53,400,000 51,300,000 [6]
5 United States American Airlines 106,013,737 105,163,576 85,719,000 92,772,000 98,162,000 99,835,000 98,038,000 [7]
6 China China Southern Airlines 80,674,800 76,500,000 66,280,000 57,961,000 56,900,000 48,512,000 43,228,000 [8]
7 Republic of Ireland Ryanair Republic of IrelandAer lingus 2 76,400,000 80,553,580 66,503,999 58,565,663 50,931,723 42,509,112 34,768,813 [9]
8 FranceNetherlands Air France-KLM 75,780,000 70,750,000 71,394,000 73,844,000 74,795,000 73,484,000 70,015,000 [10]
9 China China Eastern Airlines 64,877,800 44,042,990 37,231,480 39,161,400 35,039,700 24,290,500 [11]
10 United States US AirwaysUnited Kingdom British Airways 60,854,368 59,809,367 58,921,521 62,659,842 66,056,374 66,102,774 71,580,012 [12]
 
Emirates was about 31.4  million in 2010/11