Emirates sees strong recovery in H1 but things are not yet normal

The world is supposed to be recovering from the COVID crisis, with the airline and leisure sector back on a trajectory to normality. In the aviation sector, this does appear to be happening to an extent.

Emirates Group has just announced its half-yearly results, with the company seeing revenue up 81% year-on-year to AED 24.7 billion (US$ 6.7 billion) and EBITDA (Earnings Before Interest, Depreciation and Amortisation) positive at AED 5.6 billion (US$ 1.5 billion) in contrast to the loss of AED 14.1 billion (US$ 3.8 billion) in H1 2020. However, in terms of net profit, the company is still loss-making, with a negative result of AED 5.7 billion (US$ 1.6 billion), although this is a marked reduction in losses compared to the same period last year.

Obviously, the main reason for the recovery has been due, in the words of Emirates Group, to the “easing of travel restrictions worldwide and the corresponding increase in demand for air transport as countries progressed their COVID-19 vaccination programmes”. This has led to a 319% recovery in the number of passengers carried and a 39% increase in freight as compared to the same period last year. Emirates said that cargo volumes handled are 1.1million tonnes, which represents 90% of the 2019 volumes.

The Emirates Airline, which dominates the Group was still loss-making, being ‘in the red’ by AED 5.8 billion (US$ 1.6 billion) but revenue was 86% at AED 21.7 billion (US$ 5.9 billion). The dnata ground handling and airline service business also saw a recovery, with a 55% increase in revenue and a profit of AED 85 million (US$ 23 million). The number of aircraft handled by dnata in the first half of the year rose by 116%, the volume of cargo was up 9% whilst the number of meals served doubled.

These results are another indication that global logistics markets are recovering. They are not the first airline numbers to show this, with the US carriers seeing a recovery earlier in the year. However, Emirates occupies a pivotal position on the global airfreight network and therefore has wider implications for global trade. However, the caution of Emirates Group CEO, Sheikh Ahmed bin Saeed Al Maktoum, in saying that the ability of Emirates to “pivot and pull through” has been key to its survival, underlines the tone of caution over the depth of the recovery.

Source: Transport Intelligence, 11 November 2021

Author: Thomas Cullen