Emirates Group has announced its first year of losses in over 30 years following Covid-19’s impact, as the flagship airline recorded a 66 percent drop in revenues from last year’s results down to $9.7bn.
As a consequence of coronavirus-related flight and travel restrictions through its entire 2020-21 financial year, the Emirates Group announced on Tuesday its first non-profitable year in more than three decades with revenues at $9.7 billion, a 66 percent drop from the same period last year.
The Emirates Group posted a loss of $6 billion (AED22.1 billion) for the financial year ending 31 March 2021, compared with an AED 1.7 billion profit for last year.
The Emirates Group has announced its financial results for 2020-21, its first non-profitable year in over three decades, due to the COVID-19 pandemic impact. https://t.co/pAhEZKK3hi pic.twitter.com/pRE7NmTcxB
— Emirates Airline (@emirates) June 15, 2021
Its cash balance was $5.4 billion (AED19.8bn), down 23 percent from last year largely due to weak demand caused by the various pandemic-related business and travel restrictions across all of the Group’s core business divisions and markets.
“The Covid-19 pandemic continues to take a tremendous toll on human lives, communities, economies, and on the aviation and travel industry. In 2020-21, Emirates and dnata were hit hard by the drop in demand for international air travel as countries closed their borders and imposed stringent travel restrictions,” said His Highness Sheikh Ahmed bin Saeed Al Maktoum, chairman and chief executive, Emirates Airline and Group.
“Our top priorities throughout the year were the health and wellbeing of our people and customers, preserving cash and controlling costs, and restoring our operations safely and sustainably. Emirates received a capital injection of AED11.3bn from our ultimate shareholder, the Government of Dubai, and dnata tapped on various industry support programmes and availed a total relief of nearly AED800m in 2020-21. These helped us sustain operations and retain the vast majority of our talent pool. Unfortunately, we still had to make the difficult decision to resize our workforce in line with reduced operational requirements,” he continued.
His Highness Sheikh Ahmed bin Saeed Al Maktoum, chairman and chief executive, Emirates Airline and Group
Redundancies were implemented across all parts of the business this period, for the first time in the Group’s history with the total workforce reduced by 31 percent to 75,145 employees from 160 nationalities.
Keeping a tight control on costs, across the Group, financial obligations were restructured, contracts renegotiated, processes examined and operations consolidated. The various cost reduction initiatives returned an estimated saving of AED7.7 billion throughout the year.
With significantly reduced and constrained capacity deployment across most markets, Emirates’ total revenue for the financial year dropped 66 percent to AED30.9bn.
Emirates’ total passenger and cargo capacity declined by 58 percent to 24.8 billion ATKMs at the end of 2020-21, due to pandemic-related flight and travel restrictions including a complete suspension of commercial passenger services for nearly eight weeks as part of the measures the UAE government took from 25 March last year to curb the spread of coronavirus.
“No one knows when the pandemic will be over, but we know recovery will be patchy. Economies and companies that entered pandemic times in a strong position, will be better placed to bounce back,” said Al Maktoum.
dnata’s total revenue decreased by 62 percent to AED5.5bn
“Until 2020-21, Emirates and dnata have had a track record of growth and profitability, based on solid business models, steady investments in capability and infrastructure, a strong drive for innovation, and a deep talent pool led by a stable leadership team. These fundamental ingredients of our success remain unchanged. Together with Dubai’s undiminished ambitions to grow economic activity and build a city for the future, I am confident that Emirates and dnata will recover and be stronger than before,” he continued.
He added: “In the year ahead, we will continue to adopt an agile approach in responding to the dynamic marketplace. We aim to recover to our full operating capacity as quickly as possible to serve our customers, and to continue contributing to the rebuilding of economies and communities impacted by the pandemic.”
Meanwhile, given the circumstances, dnata’s total revenue decreased by 62 percent to AED5.5bn. dnata continued to lay the foundations for future growth with investments in 2020-21 amounting to AED328m.
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