Emirates Group's profit soars 67pc to Dh1.75b

DUBAI - The Emirates Group yesterday announced a 67 per cent surge in profit to Dh1.75 billion, and said the group, comprising Emirates airline, Dnata and associated companies, is geared to maintain the momentum of growth in 2004-05.

By Isaac John

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Published: Thu 29 Apr 2004, 9:14 AM

Last updated: Wed 1 Apr 2015, 11:54 PM

Announcing the group's performance for the financial year 2003-04 ended on 31st March, Shaikh Ahmed bin Saeed AI Maktoum, Chairman of Emirates Group, said yesterday the continued upswing this year would be driven by Emirates airline, which posted a record profit of Dh1.57 billion last year, up 73.5 per cent over the previous year.

Shrugging off the challenge posed by the no-frills airlines, Shaikh Ahmed said he would not foresee any adverse impact caused by such carriers on Emirates' performance. "We are not worried. Despite the many setbacks caused by SARS and the Iraq war, we had recorded an impressive growth in 2003." Last year, Emirates airline carried 10.4 million passengers, an increase of almost two million passengers or 23 per cent more than the year before.

Shaikh Ahmed ruled out plans to launch a separate low-cost airline division by the group to counter the challenge from budget airlines. On the group's continued ability to meet all the financial commitments, he said, "our excellent debt-equity ratio underscores this."

He said the group's total revenue reached an all-time high of Dh14 billion, which is up 35.5 per cent from last year. The Group's new best-ever annual results stem from growing customer preference for the airline and the products and services of its associated travel-related companies. The ownership will be paid a dividend of Dh329 million.

"The Emirates Group's strong performance once again confirms not just that we are on the right track but also that we are doing our part to help our government realise its aggressive master plan for Dubai's development. We have plans in place for 2004-05 to keep the momentum and continue to deliver the same kind of performance."

Emirates SkyCargo moved nearly 660 thousand tonnes in the year for an increase of 26 per cent, and the division's revenue rose 42 per cent to Dh2.4 billion, thus contributing a record 20 per cent of the airline's transport turnover.

Dnata's profit of Dh174 million was 23 per cent better than last year, on turnover of Dh1.1 billion, 14 per cent above the year before. Cash balance for Emirates stood at Dh6.4 billion at the year send, compared with Dh4.8 billion in the preceding year and substantially more than the internal benchmark of cash balances for at least six months' worth of debt obligations and lease rentals.

In outlining the reasons for the Group's strong growth, Shaikh Ahmed reaffirmed the integral part Dubai plays in the success of the Emirates Group. On the recipe for the group's continued success, he singled out "the leveraging of Dubai's location as a global hub and of the government's ambitious development programme, our multi-billion dollar investment in new equipment and the skill and dedication of our team." "We have not joined any alliances nor followed any guru's teachings' and have simply knuckled down to winning more supporters by offering them quality products," he said.

He added that the Emirates Group as a whole contributed an estimated Dh13.6 billion to the UAE economy during the past financial year. Turning to the Group's outlook for 2004-05, he said: "This financial year will see the airline increase its capacity by 26 per cent, while Dnata will continue its winning ways with new initiatives to boost services to customers."

At the end of the financial year, the Group employed 22,500 people an increase of 4,000 or 22 per cent over last year. This represented an average weekly hiring of 77 new employees and a mere fraction of the staggering 5,000 job applications received weekly on average by the Group. The total of 265,000 applications received during the past financial year represented an increase of 29 per cent over the previous one.

The Emirates Airline's fleet expanded by 15 aircraft during the past financial year and had reached 61 by 31 March. It presently stands at 67- including five freighters - serving 75 destinations in 53 countries. With 90 new aircraft in the pipeline, the airline expects its fleet to continue to expand at the rate of at least one new aircraft per month for the rest of this decade, and is on course for a 130-plus fleet by 2012. It expects to hire its 1,000th pilot and 5,000th cabin crew within the next few weeks.

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