Emirates posts half-year loss of $3.8bn as coronavirus takes its toll

Emirates Group’s employee base, compared to March 31, is substantially reduced by 24 percent to an overall count of 81,334

Emirates Group on Thursday announced a half-year net loss of AED14.1 billion ($3.8 billion), citing the impact of coronavirus for a huge downturn in revenue.

Group revenue was AED13.7 billion for the first six months of 2020-21, down 74 percent. It is the first loss reported in the company’s history.

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A statement said this dramatic revenue decline was due to the Covid-19 pandemic which brought global air passenger travel to a halt for many weeks as countries closed their borders and imposed travel restrictions.

As part of pandemic containment measures, Emirates and Dnata’s hub in Dubai also suspended scheduled passenger flights for eight weeks during April and May.

Emirates Group’s employee base, compared to March 31, is substantially reduced by 24 percent to an overall count of 81,334 in line with the company’s expected capacity and business activities in the foreseeable future and general industry outlook.

The group’s cash position on September 30 stood at AED20.7 billion, compared to AED25.6 billion as at the end of March.

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Sheikh Ahmed bin Saeed Al Maktoum, chairman and chief executive, Emirates Airline and Group said: “We began our current financial year amid a global lockdown when air passenger traffic was at a literal standstill. In this unprecedented situation for the aviation and travel industry, the Emirates Group recorded a half-year loss for the first time in over 30 years.

“As passenger traffic disappeared, Emirates and dnata have been able to rapidly pivot to serve cargo demand and other pockets of opportunity. This has helped us recover our revenues from zero to 26% of our position same time last year.

“The Emirates Group’s resilience in the face of current headwinds is testimony to the strength of our business model, and our years of continued investment in skills, technology and infrastructure which are now paying off in terms of cost and operational efficiency. Emirates and dnata have also built strong brands and agile digital capabilities which continue to serve us well, and enabled us to respond adeptly to the accelerated shift of customer and business activities online over the past 6 months.”

Sheikh Ahmed (pictured below) added: “We would like to thank our customers for their continued support, and express our appreciation for the combined stakeholder efforts that have made it possible for Dubai to resume aviation and other economic activity so quickly and safely. No one can predict the future, but we expect a steep recovery in travel demand once a ovid-19 vaccine is available, and we are readying ourselves to serve that rebound. In the meantime, Emirates and dnata remain responsive in deploying resources to serve our customers and meet demand.

“We have been able to tap on our own strong cash reserves, and through our shareholder and the broader financial community, we continue to ensure we have access to sufficient funding to sustain the business and see us through this challenging period. In the first half of 2020-21, our shareholder injected $2 billion into Emirates by way of an equity investment and they will support us on our recovery path.”

As directed by the UAE General Civil Aviation Authority, Emirates temporarily suspended passenger flights on March 25 and worked closely with governments and embassies to operate repatriation services until Dubai International airport (DXB) re-opened for transit passengers and later for scheduled passenger flights.

The airline also partnered with the health authorities to implement comprehensive pandemic health and safety measures onboard and on the ground, to safeguard its customers, employees and the communities it serves.

In pictures: Dubai's Emirates airline is stepping up Covid-19 safety measuresAll cabin crew, boarding agents and ground staff in direct contact with passengers will now don personal protective equipment (PPE) which includes a protective disposable gown over their uniforms, and a safety visor, in addition to masks and gloves.

The airline said it expedited refunds, offered rebooking flexibility, set up a Covid-19 travel information hub on its website to offer the latest updates on ever-changing travel requirements and launched the industry’s first Covid-19 medical cover for all passengers at no additional cost.

Emirates gradually restarted scheduled passenger operations on  May 21. By the end of September, the airline was operating passenger and cargo services to 104 cities.

Overall capacity during the first six months of the year declined by 67 percent while passenger traffic carried was down by 96 percent.

Emirates carried 1.5 million passengers between April and September while the volume of cargo uplifted at 0.8 million tonnes has decreased by 35 percent while yield has more than doubled by 106 percent.

In the first half of the 2020-21 financial year, the airline’s loss was AED12.6 billion, compared to last year’s profit of AED862 million.

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