Emirates Airline profits down 86% due to high fuel costs

An Emirates Airbus A380.
Emirates

• Emirates Airline profits over the
  first six months of its fiscal year are down a whopping 86%
  over the same period in 2017.
• The airline reported $62 million in profits on $13.3
  billion in revenue for the six-month period ending on
  September, 30.
• Emirates Group, the airline’s parent company, saw
  approximately $1.25 billion in profits wiped out due to fuel
  costs and currency devaluation in Asia, Africa, and South
  America. 
• Emirates Group CEO warns that “the next six months will
  be tough.”

Emirates Airline profits over the first six months of its fiscal
year are down a whopping 86% over the same period in 2017.
According to Reuters, this is the carrier’s
worst such period in a decade. 

During the six-month period ending on September 30, Emirates
reported $62 million in profits on $13.3 billion in revenue. Even
though revenue grew by 10%, the airline’s profits were severely
impacted by a 42% increase in fuel costs. 

As a result, Emirates’s profit margins for the period is down
from 3.7% to just 0.5% while cash assets are down 17% to $4.6
billion.

Read more: The 10 best airlines in the world
for 2019.

The airline’s parent company, Emirates Group, saw profits fall
53% to $296 million on $14.8 billion in revenue.

According to Emirates Group chairman and CEO Sheikh Ahmed bin
Saeed Al Maktoum, high fuel costs, as well as currency
devaluations in India, Brazil, Angola, and Iran, wiped out
roughly $1.25 billion in profits.

“We are proactively managing the myriad challenges faced by
the airline and travel industry, including the relentless
downward pressure on yields, and uncertain economic and political
realities in our region and in other parts of the
world,” Sheikh Ahmed said in a statement. “We are keeping a
tight rein on controllable costs and will continue to
drive efficiency improvement through the implementation of new
technology and business processes.”

Read more: Inside the $350 million Emirates
complex designed to fix the Airbus A380 superjumbo.

Unfortunately, things aren’t expected to get better in the
near future.

“The next six months will be tough, but the Emirates
Group’s foundations remain strong,” he added.

Since March, the Emirates Group has trimmed its employee
base by nearly 1,400 people.