Emirates lifts off, fuelled by oil glut

DUBAI’S Emirates Airline said yesterday annual profits surged 40% to $1.2-billion (R14-billion) as revenues rose and fuel costs dropped.

The Middle East’s largest carrier said revenues rose 7% to $24.2-billion (R291-billion) with passenger numbers up 11% to 49.3 million in the financial year 2014-15.

Emirates chief executive Sheikh Ahmed bin Saeed al-Maktoum said the profit was achieved despite a tough market and stiff competition.

The company said a significant drop in the price of jet fuel had reduced operating costs by 7% to $7.8-billion (R94-billion). Fuel represented 35% of operating costs, down from 39% the previous year.

The Emirates chief described the drop in oil prices as a welcome relief that impacted on the second half of the financial year. A global supply glut has eroded prices by around 60% since last year.

Emirates said it faced challenges including a weaker US dollar, to which the UAE dirham is pegged, as well as an 80-day runway closure at its hub for upgrading.

US carriers Delta, United and American Airlines allege the Gulf Big Three – Emirates, Qatar Airways and Abu Dhabi’s Etihad – have received government subsidies worth $40-billion (R481-billion) and are pushing Washington to take action.

Al-Maktoum said Emirates embraced competition.

– AFP

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