As air travel picks up, Emirates cuts annual loss to $1 billion

MUMBAI: For the second consecutive year, Dubai’s Emirates airline posted a loss of $1 billion for the year ended March 31. It was a significant improvement from the previous year though when the impact of the pandemic on air travel was more pronounced and the airline bore a loss of $5.5 billion.
Sheikh Ahmed bin Saeed Al Maktoum, chairman and chief executive, Emirates Airline and Group said: “For the Emirates Group, 2021-22 was largely about recovery, after the toughest year in our Group’s history.”
Emirates is one of the seven airlines that operate the busiest international route out of India; India-UAE country pair was the sixth busiest in the world with 1.8 million seats scheduled to be flown in the month of May, according to global travel data provider company, OAG.
The other carriers who operate the high-demand Mumbai-Dubai and Delhi-Dubai flights are Air India, IndiGo, flyDubai, Air India Express, Vistara and SpiceJet.
Emirates said it carried 19.6 million passengers in 2021-22, an increase of 199%. It reported a `Passenger Seat Factor’ of 58.6%, compared with last year’s passenger seat factor of 44.3%.
From 120 destinations at the start of the financial year, it increased its operations and capacity growth to cover 140 destinations by 31 March 2022.
The increased demand for air travel has boosted the airline’s finances, its revenues are up 91% to 16 billion as airline expanded global capacity and reinstated more passenger flights. But rising fuel costs have snipped away at the profits.
“Fuel accounted for 23% of operating costs compared to 14% in 2020-21.The airline’s fuel bill more than doubled to AED 13.9 billion ($3.8 billion) compared to the previous year, driven by a higher uplift of 66% in line with capacity expansion and a higher average fuel price which was up by 75%,” it said.
The airline’s total operating costs increased by 30% from last financial year. Cost of ownership (depreciation and amortisation) and fuel cost were the two biggest cost components for the airline in 2021-22, followed by employee cost, it said.
“We expect the Group to return to profitability in 2022-23, and are working hard to hit our targets, while keeping a close watch on headwinds such as high fuel prices, inflation, new Covid-19 variants, and political and economic uncertainty,” said Sheikh Ahmed.