Flydubai’s 2015 revenues surge 11pc amid challenges
Flydubai declared Dh4.9 billion revenues for 2015, showing an 11 per cent year-on-year growth, despite challenging environment. Last year, the Dubai-carrier carried 9.04 million passengers, recording a 25 per cent growth over previous year.
Shaikh Ahmed bin Saeed Al Maktoum, chairman of flydubai, President of the Dubai Civil Aviation Authority, Chairman of Emirates airline and Chief Executive of the Emirates Group, said: "2015 was an important year for flydubai. It was a year in which through determination and commitment we continued to realise our vision to increase connectivity in support of the UAE's economic development. The year culminated in two achievements: the delivery of our 50th aircraft; and our fourth full-year of profitability."
Ghaith Al Ghaith, chief executive officer of flydubai, said: "The overall trading environment has remained challenging but we have maintained our growth story and ended the year positively. Our robust passenger growth of 30 per cent, in terms of RPKM, underlines the demand for travel within our geographic focus; the continued appeal of Dubai as a destination; and the popularity of our service."
A senior aviation analyst said that while flydubai had struggled and fell into a loss for the first half of 2015, the airline managed to stage a stunning reversal of fortunes, bouyed by a far stronger second half of the year on increased travel demand that led to a sharp rise in traffic of over 25 per cent to over nine million passengers.
"Flydubai has demonstrated that its unique hybrid low cost model with premium fares has won it many plaudits and accolades while cementing its position as the world's fastest growing airline. The challenge now is how to continue this growth trajectory as smoothly as possible whilst ensuring that Al Maktoum International can handle its size," Saj Ahmad, the chief analyst at Londonbased StrategicAero Research, told Khaleej Times.
The airline said fuel costs reduced to 30.3 per cent of operating costs benefitting from lower fuel prices with 59 per cent of fuel costs unhedged. In line with flydubai's active fuel hedging policy, 16 per cent of the fuel requirements for the next 24 months are currently hedged. This will provide a level of certainty and control to its fuel costs due to the ongoing fluctuation in fuel prices. The closing cash and cash equivalents position, including pre- delivery payments for future aircraft deliveries, was robust at Dh2.4 billion.
Ghaith Al Ghaith, CEO of flydubai, commenting on flydubai's cost performance, said: "The solid foundation we laid when the airline launched has ensured that we are best placed to respond quickly to manage the challenging socio-economic environment, in a controlled manner, both in the short term and for the long term."
Business Class was introduced on 17 new routes in 2015 representing 87 per cent of all departures from Dubai. Flydubai saw the number of passengers from across its network who travelled in Business Class increase by 72 per cent compared to 2014. Increased accessibility to previously underserved markets has benefited cargo revenues which remain strong, posting an increase of 28.4 per cent with 40,441 tonnes carried during the year.
Starting in May, flydubai will take delivery of 16 new aircraft over the next 24 months. This includes five new Boeing 737 MAX 8 aircraft due to arrive in the second half of 2017.
The airline's route network will continue to strengthen as it sees all the 41 new routes launched in the last two years mature. Flydubai has a network of 89 destinations in 43 countries. Al Ghaith said: "Our network is maturing and so we continue to monitor capacity and review the opportunities for existing routes as well as for new routes. In response to the changing environment, considered, balanced adjustment and management will be required. Our prudent outlook will help flydubai remain well-positioned to take advantage of the opportunities within our flying radius and continue our sustained growth trajectory."