DUBAI, 27 April 2006 — The Emirates Group has announced a record performance with net profits of AED2.8 billion ($762 million) for the financial year ended March 31, 2006, up five percent from the previous year’s record AED.7 billion ($726 million) profit.
Group revenue increased by an impressive AED 5.2 billion ($1.4 billion) or 27 percent, to AED 24.3 billion ($6.6 billion) compared to AED 19.1 billion ($5.2 billion) last year. The group’s cash balance was a robust AED11 billion ($3 billion) at the end of March, an improvement of 28.6 percent against a year earlier. The 2005-06 annual report of the Emirates Group comprising Emirates Airline, Dnata and subsidiary companies, was released at a news conference by Sheikh Ahmed ibn Saeed Al-Maktoum, chairman and chief executive, Emirates Airline and Group, in Dubai yesterday.
The group’s sharp sales growth and record returns reflect customers’ increasing preference for its products, as illustrated by the two million more passengers who flew Emirates in the latest financial year, for a new record total of 14.5 million.
“These results clearly show that Emirates’ customer-oriented approach and investments in providing a quality product - the best aircraft that money can buy, top-flight service and travel experience at a competitive price - has paid off in terms of retaining and winning new customers globally,” Sheikh Ahmed said.
“It has been another tough year with pressure from fuel costs continuously dampening our robust net income production. Emirates has returned its 18th consecutive annual profit, and we’re pleased to have achieved this solid performance while expanding our operations in an increasingly competitive environment,” he added. Across the Group, initiatives to improve efficiency and keep a tight rein on costs have also contributed to the positive results, as the Group maintained a strong net profit margin of 11.8 percent.
Fuel costs remained the top expenditure accounting for 27.2 percent of total operating costs, up from 21.4 percent the previous year. Like other airlines, Emirates was forced to increase fuel surcharges on tickets, which only covered 41 percent of incremental costs.
The airline’s jet fuel risk management program helped mitigate fuel costs, saving the company $189 million in 2005-06, some 50 percent more than last year.
