Emirates reports mixed H1 results

The Emirates Group has announced its financial results for the first six months of 2014. It reported revenue of AED47.5bn for the first half of 2014, an increase of 12% from the same period of 2013. The company also recorded net profit for of AED2.2bn, an increase of 1% year-on-year. Accordingly Emirates’ net profit margin stood at 4.63%.

The revenue result of Emirates was in part aided by cargo operations after the volume of cargo uplifted rose by 5.4% compared to the first half of 2013. Meanwhile dnata, Emirates’ air services division, saw revenue rise to AED4.6bn, an increase of 24.32% compared to the same period of 2013. Again this result was supported by dnata’s cargo handling division, the revenues of which increased by 18%, compared to the first half of 2013, to AED644m, on account of a 3% increase in volume to 835,979 tonnes.

However overall profit for dnata dropped by 26% year-on-year to AED339m. This was due to a number of factors including the impact of runway enhancement works at Dubai International Airport which saw dnata handling fewer aircraft during this period, as well as costs incurred to set up and launch handling operations at Dubai World Central. This contributed to the flat profit result which could not be helped by the softening of fuel prices towards the end of the six-month period as the cost of fuel as a share of operating costs reduced to 38% during the period. External challenges – such as health scares, conflicts, runway closures and weak markets – which led the airline to suspend a record number of routes and temporarily ground part of its fleet also negatively affected profitability.

“As the biggest operator at Dubai International, we also took the biggest hit to our bottom line from the 80-day runway upgrading works. However, we had anticipated it and made meticulous plans to minimise impact operationally and commercially for both Emirates and dnata. The success of these plans can be seen in our overall growth during this six-month period in spite of the challenge,” said Ahmed bin Saeed Al Maktoum, Chairman and Chief Executive of Emirates Airline.

During the first six months of the fiscal year Emirates received 13 wide-body aircraft, six A380s and seven Boeing 777s. Emirates expects 11 more new aircraft to be delivered before March 31, 2015. Emirates also expanded its global route network by launching services to Abuja, Nigeria; Chicago, US; Oslo, Norway; and Brussels, Belgium.


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