DUBAI — Emirates has said that Dubai would help the airline through the coronavirus crisis after losses of $3.4 billion tipped the airline’s holding company into its first half-year loss in more than thirty years.
Emirates said global travel restrictions meant revenue dropped by 75% to $3.2 billion as passenger traffic fell by 95% to 1.5 million in the six months to the end of September.
“The last time Emirates airline reported a loss was for the financial year 1987-88, and that was primarily due to the costs of its start-up operations,” a spokeswoman said.
Sheikh Ahmed bin Saeed Al Maktoum, President of the Dubai Civil Aviation Authority, Chiarman of Emirates airline and Chief Executive of Emirates Group, said the Dubai government would support the airline on its recovery path.
“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,” he said.
Emirates temporarily suspended most of its flights at the height of the pandemic, which has decimated global travel. The airline filled just 38.6%% of the seats on offer, though saw high demand for freight due to limited availability of air cargo services globally due to the drop in passenger flights.
“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,” Sheikh Ahmed said..
“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,” he said.
Emirates, which a year ago reported a $235 million half-year profit, received $2 billion in state assistance from the Dubai government between April and September this year, which the airline said was an equity investment. The airline’s entire operation is dependent on international demand as it does not operate domestic flights.
Emirates Group, which includes the airline and other aviation and travel assets, saw revenue plunge 74% to $3.7 billion and made a loss of $3.8 billion. 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 8 weeks during April and May.