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Emirates Group has just published its results for the first half of the fiscal year (April 1 to October 30, 2020).
Unsurprisingly, the airline is reporting its biggest loss ever, after 32 consecutive years of profit (or at least that’s what the airline claims).
Emirates record loss (unsurprisingly)
Emirates Group has just shared its financial results for the first half of the fiscal year, as Emirates Group recorded a loss of $ 3.8 billion, while Emirates Airline recorded a loss of $ 3.4 billion . If my calculations are correct, a loss of $ 3.4 billion equals ~ $ 18.6 million per day, ~ $ 775,000 per hour, ~ $ 13,000 per minute, ~ $ 215 per second. Ouch.
To clarify the distinction, Emirates Group includes other subsidiaries, such as dnata, which is an airport service provider.
Emirates Airline reported loss of $ 3.4 billion
For the most part, I will focus specifically on the results of Emirates Airline, as that is what I find most interesting. When we look at the results of Emirates Airline, keep in mind that the airline had to suspend operations in March as per government guidelines and only restarted very gradually after several weeks.
In this spirit:
- Emirates revenue fell 75% to $ 3.2 billion
- Emirates capacity decreased by 91%, measured in available seat kilometers
- Emirates capacity decreased by 96%, measured in passenger seat-kilometers
- Emirates had an average load factor of 38.6%, up from 81.1% before the pandemic
- Emirates carried 1.5 million passengers in six months, down 95% from same period last year
- Emirates operating costs reduced by 52%
- Emirates’ fuel costs fell 83% from the same period last year, due to a combination of lower oil prices (down 49% from the same period l last year), as well as a 76% drop in demand due to lack of operations; fuel accounted for 11% of operating costs, compared to 32% of operating costs in the same period last year
- Emirates freight volume fell 35% while yields increased 106% (wow)
- Emirates has only withdrawn three aircraft in the past six months, although most of the carrier’s fleet remains grounded
With regard to the Emirates group as a whole:
- Emirates Group has $ 5.6 billion in cash as of September 30, 2020, compared to $ 7 billion in cash as of March 31, 2020
- The number of Emirates Group employees as of September 30, 2020 has been reduced by 24% to 81,334
Emirates had an average load factor of less than 40%
At the end of the line
Emirates’ losses for the first half of the fiscal year are not surprising, given that it covers the worst of the pandemic to date. Not only did the airline face many of the same challenges as other airlines, but it also took on the challenge of having operations suspended for several weeks, while being an exclusively international airline.
While Emirates is far from clear, I imagine the losses will narrow a bit in the second half of the year as demand for international travel increased a bit and the company also cut costs, including through layoffs.
What do you think of Emirates’ results for the first half of the year?
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