Air Arabia’s profit up 31% as passengers increase
SHARJAH CARRIER’S ABILITY TO CAPITALISE ON UNDERSERVED ROUTES BOOSTS RESULTS Dh66m Carrier’s net profit for the three months ending June 30, 2012.
Budget carrier Air Arabia said yesterday its net profit for the second quarter of 2012 jumped 31 per cent as it flew more passengers. The Sharjah-based carrier’s net profit for the three months ending June 30, 2012, rose to Dh66 million, up from Dh51 million in the same period a year earlier.
The airline saw passenger numbers jump 15 per cent in the period to 1.3 million in the second quarter, while the average load factor, or passengers carried as a percentage of available seats, touched 85 per cent.
In the first half of 2012, meanwhile, Air Arabia saw profit increasing 22 per cent to Dh115 million against Dh94 million in the corresponding period last year. Passenger numbers for the period hit 2.5 million, an 11 per cent increase over the same period last year, the carrier said.
“Looking ahead, we are con- fident about the outlook of lowcost travel in the region. As we continue expanding into new markets and adding new services, we look forward to providing best-in-class services for our customers throughout the year and beyond,” Shaikh Abdullah Bin Mohammad Al Thani, chairman of Air Arabia, said in a statement.
He added that in the second quarter the airline’s ability to identify and capitalise on underserved routes continued to reap benefits.
The publicly-listed carrier’s turnover in the second quarter reached Dh729 million, up 23 per cent from the previous year’s period.
Air Arabia’s strong performance underlines the regional strength of the GCC as a region, as noted recently by the aviation watchdog the International Air Transport Association.
Rise in customer base
Commenting on the airline’s positive performance, aviation analyst Saj Ahmad of StrategicAero Research told Gulf News: “As the first low-cost airline in the region, Air Arabia has continued to grow its customer base and that’s reflected in its high load factors, driving profit by 22 per cent over a year ago, despite fears about the fallout of Syria and continued change in Libya and Egypt.”
He added that the airline can be expected to match the second half of the year with another strong push, “even though fears of oil price rises will likely pressurise earnings”.
Besides high passenger numbers, new route launches added impetus to Air Arabia’s performance in the first six months of the year as the carrier added routes to Taif in Saudi Arabia and Salalah in Oman, bringing its global network to 75 destinations.
Air Arabia currently operates a fleet of 31 new Airbus A320 aircraft from its three hubs in the UAE, Morocco and Egypt. The airline deferred its plans for the fourth hub in Jordan earlier this year due to regional instability, high fuel prices and worsening economic conditions in Europe.
“Air Arabia is in good health and it’s clear that its expansion plans, coupled with new A320 deliveries, has helped to push costs down, and aside from a minor dip in performance as a result of Ramadan, the airline is looking to leverage its network strength to boost frequencies and step up expansion throughout the GCC over the coming year,” Ahmad added.