The Emirates group has had another record breaking year, registering a 74 per cent, or $285.7 million, increase in net profits for the financial year 2002/3.
Presenting the annual report and accounts at a press conference yesterday in Dubai, where Emirates is based, group chairman Sheikh Ahmed bin Saeed Al-Maktoum described the past 12 months as "another challenging year and most successful year".
Emirates Airline's operations alone achieved a 94 per cent increase in profits, from $127.6 million to $247.1 million. The average passenger seat factor rose to 76.6 per cent and the 525,188 tonnes of cargo carried represented 19.6 per cent of the airline's revenue.
Total group revenue increased by 31 per cent, or $2.8 billion, compared with $2.1 billion the previous year. The cash balance for the group stood at $1.3 billion, compared with $0.9 billion the previous year.
Sheikh Ahmed said the secret behind the group's profits was its passion for quality and dedicated personnel. "This success does not come automatically, or by chance, but it is the consequence of real teamwork by our experienced and professional management and staff who have the ability to combine hard-nosed, cost effective measures with a people-to-people personal touch."
He said growth had varied between 20 per cent and 30 per cent and attributed this to the group's rising profits. He also announced that staff were being allocated a higher budget to enable them to make even more profit.
The airline carried 8.5 million passengers, an increase of 26 per cent over the previous year. It now ranks 20th in size among international airlines and one of the five most profitable despite only being launched in 1985.
Sheikh Ahmed said the airline intends to expand its current fleet of about 50 aircraft to between 110 and 120 in the next seven years, making it the biggest current purchaser of new planes. The fleet will include the new Airbus super jumbo A380-100, which can seat 555 passengers.
The airline flies to 64 cities in 45 countries and new destinations this year include Brisbane and Shanghai. Meanwhile, Sheikh Ahmed said that Emirates could start services to Iraq next month.
The airport section of the company, Dnata, also had a record year, registering a net income of $38.6 million, compared with $36.7 million the previous year. Dnata handled 16.5 million passengers and 924,000 tonnes of cargo. It turned around almost 70,000 aircraft.
The staggering profits of Emirates, which is wholly owned by the government of Dubai, have raised eyebrows especially since many airlines are floundering in the light of the lingering effects of September 11, war in Iraq and the Sars virus. However, its management goes to great lengths to stress that the airline is run on a commercial basis and receives no financial support, financial guarantees or protection from the government, which operates an unconditional open skies policy in Dubai.
Sheikh Ahmed said that no services had been cut to Hong Kong in spite of Sars and added that passengers on Emirates' flights could be confident they would not catch the disease.
He said the airline's growth went hand in hand with the rapid growth of Dubai: "We are, indeed, fortunate to be in a part of the world where the economy is booming, for when we compare our results with those of the world aviation industry in general they seem almost surreal."
The contribution of the group to the Dubai economy was $1.1 billion in direct expenditure, plus an estimated $1.65 billion in related expenditure by third parties.