Speaking at the Arabian Travel Market trade fair in Dubai, the President of Emirates said the airline expected “positive” full-year results but cautioned that they would not be as good as has been witnessed in some previous years. Sir Tim Clark, told delegates the Dubai-based airline had “managed to come ahead with positive results, although it’s not as good as it has been in the past.”
Emirates is expected to report its full-year results for 2018/2019 on May 9th.
Speaking in November, the Chairman and chief executive of the Emirates Group, Sheikh Ahmed bin Saeed Al Maktoum warned of “myriad challenges” facing the airline. “The next six months will be tough,” Al Maktoum cautioned as Emirates presented its results for the first six months of the year.
Emirates Airlines reported an 86% decline in half-year profit to just $62 million, while the wider Emirates Group which includes ground and cargo handling business DNATA reported a $296 million profit – down 53% on the same period the year before.
Emirates has largely blamed rising fuel prices for the decline in profit as its one of the biggest expenses that any airline faces. Unlike some competitors, Emirates does not hedge on fuel and instead pays at market rates so it is hit hard when prices rise quickly and steeply.
In a nod to the ongoing dispute with Qatar, the airline has also blamed “uncertain” geopolitical “realities” in the region, as well as the intense competition that is putting “downward pressure” on yields.
The airline recently confirmed it is on track to unveil a Premium Economy product next year to better compete with rivals and extract more money from passengers who can’t necessarily afford Business Class but do have enough money for an upgrade from standard Economy.
Sir Tim told the Arabian Travel Market that the rise in oil prices had not seen an uptick in premium travel as is normally the case in the region. Quoted by Reuters, the British businessman also told the conference that the geopolitical issues in the Gulf had dampened the airline’s ability to grow.