Emirates Group announces half year performance for 2019 20, with AED 1.2 billion profit, 7.9% increase in passengers carried to Dubai
←
→
Page content transcription
If your browser does not render page correctly, please read the page content below
Emirates Group announces half‐year performance for 2019‐20, with AED 1.2
billion profit, 7.9% increase in passengers carried to Dubai
Group: Revenue down 2% to AED 53.3 billion (US$ 14.5 billion), and profit of AED 1.2 billion
(US$ 320 million), up 8%. Results impacted by Dubai International Airport (DXB) runway
closure, decline in fuel cost, unfavourable currency movements, and bankruptcy of Thomas
Cook.
Emirates: Revenue down 3% to AED 47.3 billion (US$ 12.9 billion), and profit increase of
282% to AED 862 million (US$ 235 million). Improved seat load factor of 81.1%, up 2.3%pts,
with 29.6 million passengers carried. Dubai’s strong attraction as a destination sees the
airline carrying 7.9% more customers to its hub city compared to same period last year
dnata: Revenue up 5% to AED 7.4 billion (US$ 2.0 billion), profit down 64% to AED 311
million (US$ 85 million), reflecting impact of Thomas Cook bankruptcy and last year’s one‐
time transaction. 51.9m meals uplifted, up 67% due to major business expansion.
DUBAI, U.A.E., 7 November 2019: The Emirates Group today announced its half‐year results for its
2019‐20 financial year.
Group revenue was AED 53.3 billion (US$ 14.5 billion) for the first six months of 2019‐20, down 2%
from AED 54.4 billion (US$ 14.8 billion) during the same period last year. This slight revenue decline
was mainly due to planned capacity reductions during the 45‐day Southern Runway closure at Dubai
International airport (DXB), and unfavourable currency movements in Europe, Australia, South Africa,
India, and Pakistan.
Profitability was up 8% compared to the same period last year, with the Group reporting a 2019‐20
half‐year net profit of AED 1.2 billion (US$ 320 million). The profit improvement was primarily due to
the decline in fuel prices of 9% compared to the same period last year, however the gain from lower
fuel costs were partially offset by negative currency movements.
The Group’s cash position on 30th September 2019 stood at AED 23.0 billion (US$ 6.3 billion),
compared to AED 22.2 billion (US$ 6.0 billion) as at 31st March 2019.
His Highness (HH) Sheikh Ahmed bin Saeed Al Maktoum, Chairman and Chief Executive, Emirates
Airline and Group said: “The Emirates Group delivered a steady and positive performance in the first
half of 2019‐20, by adapting our strategies to navigate the tough trading conditions and social‐political
uncertainty in many markets around the world. Both Emirates and dnata worked hard to minimise the
impact of the planned runway renovations at DXB on our business and on our customers. We also
kept a tight rein on controllable costs and continued to drive efficiency improvement, while ensuring
that our resources were deployed nimbly to capitalise on areas of opportunity.
“The lower fuel cost was a welcome respite as we saw our fuel bill drop by AED 2.0 billion compared
to the same period last year. However, unfavourable currency movements wiped off approximately
AED 1.2 billion from our profits.
“The global outlook is difficult to predict, but we expect the airline and travel industry to continue
facing headwinds over the next six months with stiff competition adding downward pressure on
margins. As a Group we remain focussed on developing our business, and we will continue to invest
in new capabilities that empower our people, and enable us to offer even better products, services,
and experiences for our customers.”
The Emirates Group’s employee base remained unchanged compared to 31 March 2019, at an
overall average staff count of 105,315. This is in line with the company’s planned capacity and
business activities, and also reflects the various internal programmes to improve efficiency through
the implementation of new technology and workflows.Emirates airline During the first six months of 2019‐20, Emirates received 3 Airbus A380s, with 3 more new aircraft scheduled to be delivered before the end of the 2019‐20 financial year. It also retired 6 older aircraft from its fleet with a further 2 to be returned by 31 March 2020. The airline’s long‐standing strategy to invest in the most advanced wide‐body aircraft enables it to improve overall efficiency, minimise its emissions footprint, and provide high quality customer experiences. Emirates continues to offer ever better connections for its customers across the globe with just one stop in Dubai. In the first six months of its financial year, Emirates added two new passenger routes: Dubai‐Bangkok‐Phnom Penh, and Dubai‐Porto (Portugal). As of 30 September, Emirates’ global network spanned 158 destinations in 84 countries. Its fleet stood at 267 aircraft including freighters. Emirates also further developed its partnership with flydubai. Both airlines continued to leverage their complementary networks to optimise flight schedules and offer new city‐pair connections through Dubai, as well as open new routes including Naples (Italy) and Tashkent (Uzbekistan) in the first half of 2019‐20. Customers also enjoy even more benefits with a single loyalty programme under Emirates Skywards, and passengers connecting between Emirates and flydubai can experience seamless transits with 22 flydubai flights now operating from Emirates Terminal 3 at DXB. Overall capacity during the first six months of the year declined by 7% to 29.7 billion Available Tonne Kilometres (ATKM) mainly due to the DXB runway closure and reduction in fleet during this 45‐day period. Capacity measured in Available Seat Kilometres (ASKM), shrunk by 5%, whilst passenger traffic carried measured in Revenue Passenger Kilometres (RPKM) was down by 2% with average Passenger Seat Factor rising to 81.1%, compared with last year’s 78.8%. Emirates carried 29.6 million passengers between 1 April and 30 September 2019, down 2% from the same period last year, however, passenger yield increased by 1% period‐on‐period. The volume of cargo uplifted at 1.2 million tonnes has decreased by 8% while yield declined by 3%. This reflects the tough business environment for air freight in the context of global trade tensions and unrest in some key cargo markets. In the first half of the 2019‐20 financial year, Emirates net profit was AED 862 million (US$ 235 million), up 282%, compared to last year. Emirates revenue, including other operating income, of AED 47.3 billion (US$ 12.9 billion) was down 3% compared with the AED 48.9 billion (US$ 13.3 billion) recorded during the same period last year. This result was driven by increased agility in capacity deployment, with healthy customer demand for Emirates’ products driving improved seat load factors and better margins. Emirates operating costs shrunk by 8% against the overall capacity decrease of 7%. On average, fuel costs were 13% lower compared to the same period last year, this was largely due to a decrease in oil prices (down 9% compared to same period last year), as well as a lower fuel uplift due to reduced capacity during 45‐day runway closure at DXB. Fuel remained the largest component of the airline’s cost, accounting for 32% of operating costs compared with 33% in the first six months of last year. dnata dnata continued to strengthen its global capabilities in ground handling, catering and travel services, with operations spanning over 35 countries. In the first half of 2019‐20, dnata’s international operations accounted for over 72% of its revenue, compared to 68% during the same period last year.
dnata’s revenue, including other operating income, was AED 7.4 billion (US$ 2.0 billion), a 5% increase compared to AED 7.0 billion (US$ 1.9 billion) last year. This performance was underpinned by robust business growth and further global expansion, particularly in its catering business. Overall profit for dnata was down by 64% to AED 311 million (US$ 85 million), compared to last year’s result which included an AED 321 million one‐off gain from the divestment of dnata’s 22% stake in the travel management company Hogg Robinson Group (HRG). dnata’s half year profit for 2019‐20 was further impacted by the bankruptcy of Thomas Cook, one of its major customers for dnata’s travel and catering businesses in the UK, resulting in an impairment loss on trade receivables and intangible assets amounting to AED 84 million. dnata’s airport operations remains the largest contributor to revenue with AED 3.6 billion (US$ 983 million), a slight increase as compared to the same period last year. Across its operations, the number of aircraft handled by dnata remained steady with 351,194, and it handled 1.5 million tonnes of cargo, down 6%. Organic growth across dnata’s international ground handling business with key contract wins across US locations, and improved performance in markets such as Italy, Singapore, Switzerland and Iraq, helped drive dnata’s revenue and compensate for the negative currency impact of approximately AED 86 million. In the UAE, dnata acquired full ownership of freight forwarding company, Dubai Express, which bolstered its revenues in the first half year of 2019‐20, and helped soften the impact of losses due to the 45‐day runway closure at DXB. dnata's travel division contributed AED 1.8 billion (US$ 488 million) to revenue, up 7% from the same period last year. The division’s underlying total transactional value sales remained at AED 5.9 billion (US$ 1.6 billion). The strong revenue contributions from its new acquisitions including Tropo in Germany, and Dunya Travel, helped offset weaker travel demand in other key travel markets, as well as the negative impact of the strong US dollar against the Euro and Pound Sterling. dnata’s flight catering operation, contributed AED 1.8 billion (US$ 479 million) to its total revenue, up 54%. The number of meals uplifted increased by 67% to 51.9 million meals for the first half of the financial year. This significant uptick is largely attributed to the contributions from its recently‐acquired catering businesses in Australia (Q Catering Limited and Snap Fresh Pty Limited), and in the US (121 Inflight Catering); as well as the expansion of dnata’s own catering facilities in the US including at Houston, Boston, and Los Angeles. ‐ends
Emirates
INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 SEPTEMBER 2019 (UNAUDITED)
#Emirates
INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 SEPTEMBER 2019 (UNAUDITED)
Page
Interim consolidated income statement 1
Interim consolidated statement of comprehensive income 1
Interim consolidated statement of financial position 2
Interim consolidated statement of changes in equity 3
Interim consolidated statement of cash flows 4
#Emirates
INTERIM CONSOLIDATED INCOME STATEMENT
FOR THE SIX MONTHS ENDED 30 SEPTEMBER 2019
Unaudited Unaudited
Sep 2019 Sep 2018
AED m AED m
Revenue 46,781 48,387
Other operating income 506 546
Operating costs (43,861) (47,890)
Operating profit 3,426 1,043
Finance income 325 237
Finance costs (2,842) (1,008)
Share of results of investments accounted for using the equity method 43 46
Profit before income tax 952 318
Income tax expense (29) (28)
Profit for the period 923 290
Profit attributable to non-controlling interests 61 64
Profit attributable to Emirates' Owner 862 226
INTERIM CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE SIX MONTHS ENDED 30 SEPTEMBER 2019
Profit for the period 923 290
Items that are or may be reclassified subsequently to the consolidated income statement
Currency translation differences (6) (12)
Cash flow hedges (10) 73
Other comprehensive income for the period (16) 61
Total comprehensive income for the period 907 351
Total comprehensive income attributable to non-controlling interests 61 64
Total comprehensive income attributable to Emirates' Owner 846 287
#Emirates
INTERIM CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 30 SEPTEMBER 2019
Unaudited Audited
Unaudited Audited
Sep 2019 Mar 2019
Sep 2019 Mar 2019
AED m AED m
AED m AED m
EQUITY AND LIABILITIES
ASSETS
Capital and reserves
Non-current assets Capital 801 801
Property, plant and equipment 85,999 89,431 Other reserves (76) (60)
Right-of-use assets 56,145 - Retained earnings 27,613 36,408
Attributable to Emirates' Owner 28,338 37,149
Intangible assets 3,587 1,574
Non-controlling interests 585 594
Investments accounted for using the equity method 672 683
Total equity 28,923 37,743
Advance lease rentals - 4,619
Non-current liabilities
Trade and other receivables 127 139
Trade and other payables 133 155
Derivative financial instruments 31 24
Borrowings and lease liabilities 92,512 45,433
Deferred income tax asset 13 13 Deferred credits - 2,437
146,574 96,483 Derivative financial instruments 179 81
Current assets Provisions 7,393 4,081
Deferred income tax liabilities 3 3
Inventories 2,642 2,525
100,220 52,190
Advance lease rentals - 602 Current liabilities
Trade and other receivables 7,860 10,740 Trade and other payables 26,294 26,795
Borrowings and lease liabilities 17,546 7,606
Derivative financial instruments 73 11
Deferred credits - 322
Short term bank deposits 14,283 11,974 Derivative financial instruments 31 20
Cash and cash equivalents 4,008 5,063 Provisions 388 678
28,866 30,915 Income tax liabilities 41 35
Deferred revenue 1,997 2,009
Total assets 175,440 127,398
46,297 37,465
Total liabilities 146,517 89,655
Total equity and liabilities 175,440 127,398Emirates
INTERIM CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE SIX MONTHS ENDED 30 SEPTEMBER 2019 (UNAUDITED)
Attributable to Emirates' Owner
Non-
Other Retained controlling Total
Capital reserves earnings Total interests equity
AED m AED m AED m AED m AED m AED m
31 March 2018 801 15 35,638 36,454 592 37,046
Impact on adoption of IFRS 15 - - (41) (41) - (41)
Adjusted 1 April 2018 801 15 35,597 36,413 592 37,005
Profit for the period - - 226 226 64 290
Other comprehensive income - 61 - 61 - 61
Total comprehensive income for the period - 61 226 287 64 351
Dividends - - - - (77) (77)
Transactions with Owners - - - - (77) (77)
30 September 2018 801 76 35,823 36,700 579 37,279
31 March 2019 801 (60) 36,408 37,149 594 37,743
Impact on adoption of IFRS 16 - - (9,657) (9,657) (6) (9,663)
Adjusted 1 April 2019 801 (60) 26,751 27,492 588 28,080
Profit for the period - - 862 862 61 923
Other comprehensive income - (16) - (16) - (16)
Total comprehensive income for the period - (16) 862 846 61 907
Dividends - - - - (65) (65)
Capital contribution - - - - 1 1
Transactions with Owners - - - - (64) (64)
30 September 2019 801 (76) 27,613 28,338 585 28,923Emirates
INTERIM CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE SIX MONTHS ENDED 30 SEPTEMBER 2019
Unaudited Unaudited
Unaudited Unaudited Sep 2019 Sep 2018
Sep 2019 Sep 2018 AED m AED m
AED m AED m Investing activities
Operating activities Additions to property, plant and equipment (3,906) (2,276)
Profit before income tax 952 318 Additions to intangible assets (778) (130)
Adjustments for: Proceeds from sale of property, plant and equipment 15 25
Depreciation and amortisation 9,751 4,571 Investments in associates and joint ventures - (35)
Finance costs - net 2,517 771 Movement in short term bank deposits (2,309) 2,254
Loss on disposals / write-offs of property, plant Interest received 226 189
and equipment 56 44 Dividends from investments accounted for using the
Share of results of investments accounted for equity method 43 61
using the equity method (43) (46)
Net cash (used in) / generated from investing activities (6,709) 88
Net provision for impairment of trade and other
receivables 26 11
Financing activities
Provision for retirement benefit obligations 371 386 4,640
Proceeds from term loans 5,460
Unrealised exchange gain (215) - (1,927)
Repayment of bonds and term loans (4,634)
Net movement on derivative financial instruments - (3)
Interest paid (2,442) (877)
Payment of retirement benefit obligations (335) (320)
Principal element of lease payments
Income tax paid (23) (48) (2018 : Principal element of finance lease payments) 19 (4,443) (4,975)
Change in inventories (117) (133) Dividend paid to Emirates' Owner - (1,000)
Change in advance lease rentals, trade and other
Dividend paid to non-controlling interests (65) (77)
receivables 1,125 157
Capital introduced by non-controlling interests 1 -
Change in provisions, payables, deferred credits and
deferred revenue (2,258) (2,698) Net cash used in financing activities (6,123) (4,216)
Net cash generated from operating activities 11,807 3,010
Net change in cash and cash equivalents (1,025) (1,118)
Cash and cash equivalents at beginning of the period 5,034 5,675
Effect of exchange rate changes on cash and cash equivalents (1) (2)
Cash and cash equivalents at end of the period 4,008 4,555
# #You can also read
