Emirates Group First-Half Profit Falls 53% on Fuel Costs, FX

(Bloomberg) -- Dubai’s Emirates Group posted a 53 percent decline in first-half earnings, citing higher fuel costs and foreign-currency movements.

• Net income at the world’s biggest long-haul airline group slumped to 1.1 billion dirhams ($296 million) in the six months ended Sept. 30, according to a statement Thursday.

Key Insights

• Profit decline follows a slump in fiscal 2017 that saw Emirates grapple with the toughest operating conditions in its history as lower oil prices stunted Mideast travel. Rising crude has restored energy-industry demand but is a double-edged sword, with jet-fuel costs up 42 percent.

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• The airline has yet to break an impasse with Rolls-Royce Holdings Plc over the supply of engines for a new batch of double-decker Airbus SE A380s. Talks center on the performance and price of the turbines; a failure to agree could threaten the order and the superjumbo’s future.
• Bloomberg reported Sept. 20 that Emirates was exploring a deal to take over the airline arm of Persian Gulf neighbor Etihad Airways, which has struggled to turn Abu Dhabi into global hub to rival Dubai. Emirates has said that no talks are underway.

Earnings Details

• Group sales advanced 10 percent to 54.4 billion dirhams
• Airline’s profit tumbles 86 percent
• To see the Emirates statement click here.

To contact the reporter on this story: Layan Odeh in Dubai at lodeh3@bloomberg.net

To contact the editors responsible for this story: Anthony Palazzo at apalazzo@bloomberg.net, Claudia Maedler, Christopher Jasper

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