World Cup airlift helps flydubai to post record Dh1.2 billion profits in 2022

Flydubai on Wednesday posted a historic profit of Dh1.2 billion ($327 million) due its nearly 1,300 shuttle flights to neighbouring Qatar during the football World Cup.

The Dubai-based airline, which recorded 43 per cent year-on-year growth in annual net profit last year, bounced back strongly from a Covid-hit 2021 and posted strong results despite higher oil prices in the international markets.

The carrier, which has been operating since 2009, said its total annual revenue surged 72 per cent to Dh9.1 billion ($2.5 billion) from Dh5.3 billion ($1.4 billion) in 2021.

Closing cash and cash equivalents position, including pre-delivery payments for future aircraft deliveries, was reported at Dh4.3 billion compared to Dh3.8 billion last year, according to the airline statement.

"The year ended with a mass airlift of World Cup fans to and from Qatar, with 1,290 flights — up to 30 a day — ferrying 133,000 people of 171 different nationalities," it said.

Strong business model

Sheikh Ahmed bin Saeed Al Maktoum, Chairman of flydubai, said flydubai’s record performance for 2022 is a direct result of the carrier’s strong business model as well as its adaptability and agility during challenging times which has cemented its position as a key contributor to the success of Dubai’s aviation hub.

"Flydubai remained committed to maintaining the highest levels of cost and operational efficiencies while preserving and growing its workforce over the past two years. This meant the carrier was quick to cater to the pent-up demand and support Dubai’s accelerated recovery," he said.

He said flydubai’s second consecutive year of profitability since the start of the pandemic is testament to the exceptional contribution of its skilled team and the "positive environment we operate in", which is conducive to growth and success.

"I look forward to seeing the vital role flydubai plays in the continued growth of the aviation sector; a key driver in realising the Dubai Economic Agenda D33,” Sheikh Ahmed.

Route expansion

Flydubai launched 16 routes and ended the year with a network of 114 destinations. It carried 10.6 million passengers across its network; an increase of 89 per cent compared to 2021.

The airline continued to see increased demand on its popular seasonal summer routes. It saw an increase in demand for connecting traffic, with 46 per cent of passengers connecting to the flydubai network or through its codeshare with Emirates; compared to 34 per cent in 2021.

“We realised early on the great opportunities that Dubai provides and remained focused and ready to scale up our operations once the demand for travel returned. Our resilient financial stance enabled us to maintain positive cash flows and not require the government aid that was available to us during the pandemic," Ghaith Al Ghaith, chief executive officer of flydubai, said.

He said 2022 has been an exceptional year, with accelerated demand, bookended by the final few months of Expo 2020 and the unprecedented efforts to support travel to and from the World Cup in Doha.

"Navigating through challenging times characterised by continued fluctuating fuel prices, disruption to supply chains, rising global inflation and geopolitical unrest did not dampen our strong performance last year," he said.

Aircraft delivery

Flydubai took delivery of 17 new aircraft, a record number of deliveries received in one year in the history of the airline. Growing its fleet by 25 per cent compared to the previous year, the airline ended 2022 with 74 aircraft: 32 Next-Generation Boeing 737-800, 39 Boeing 737 MAX 8, and two Boeing 737 MAX 9 aircraft. Two Next-Generation Boeing 737-800 aircraft were returned to the lessors at the end of their operating lease.

During 2022, flydubai secured financing for 20 Boeing 737 MAX aircraft and 3 LEAP-1B engines through a combination of sale and leaseback and commercial debt financing.

To support the growth of the airline, 1,300 employees joined flydubai in 2022 and about 80 per cent of whom are cabin crew, engineers or pilots. This was the biggest recruitment drive that has ever been undertaken by flydubai in any single year, the statement said.

Fuel cost continues to be the single highest operating cost for the airline with 33.9 per cent of total annual operating costs, due to the substantial increase in fuel prices last year. The reintroduction of the Boeing 737 MAX aircraft is expected to continue to bring greater fuel efficiency to the carrier’s growing fleet.

"Our robust cost control measures, network optimisation, strong yield and the significant fuel efficiencies of our fleet of Boeing 737 MAX aircraft have contributed to this historic financial performance," Al Ghaith said.

"I am proud to see our network, fleet, workforce and performance reach new heights. This is all due to the unwavering vision of the leadership of Dubai and the UAE, and the hard work and dedication of everyone at flydubai,” he said.

• Business