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28 March 2024

Etihad Q3 revenues surge 29%

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By Staff

Abu Dhabi-based Etihad Airways has reported revenues of $1.8 billion (Dh6.6bn) for the third quarter of 2014, an increase of 29 per cent year-on-year, achieved on the back of accelerated passenger and cargo growth during the summer.

A total of 3.9 million passengers travelled with Etihad Airways between July and September this year, 30 per cent higher than the three million passengers from the same period in 2013.

Etihad Cargo also outperformed the global market, carrying 144,498 tonnes of freight and mail during the third quarter, a year-on-year increase of 9 per cent, on just 1 per cent capacity growth.

The growth in passenger demand and revenue during the three month period once again outstripped the airline’s capacity increase, highlighting the strength of its long-term growth strategy. Etihad Airways said it remains on track to achieve its strongest ever annual results, having carried 10.5 million passengers and almost 415,000 tonnes of cargo between January and September 2014.

James Hogan, President and CEO of Etihad Airways, said in a media statement: “Our focus on organic growth, codeshare partnerships and minority investments in other airlines has continued to produce strong results, despite the prevalence of industry challenges such as volatile oil prices, economic and political instability, overcapacity in the market, and access constraints. We are confident about sustaining our profitability in 2014.”

The third quarter included the start of the airline’s Yerevan, Perth and Rome services, while frequencies increased on eight existing routes, including Dublin, Athens and Chennai. The airline’s global route network currently includes 110 existing or announced destinations, with flights launching to Phuket this month, San Francisco in November, and Dallas in December.

Organic growth was supported by codeshare and equity partnerships in the third quarter of 2014, delivering an estimated 1.1 million passengers onto Etihad Airways flights (+41 per cent year-on-year) and contributing revenue of $352 million (Dh1.3bn), which represented 27 per cent of the airline’s passenger revenue.

During this period, a new partnership agreement was signed with Philippine Airlines (PAL), covering codeshare flights, loyalty programs, airport lounges, cargo, and coordination of airport operations. Etihad Airways also expanded existing codeshares with partners such as Korean Air, KLM Royal Dutch Airlines, Air New Zealand and S7 Airlines.

Etihad Airways and Alitalia signed a transaction implementation agreement in August 2014, which, subject to regulatory approval, will result in a €1,758m investment to build a reinvigorated Alitalia. This includes a €560m investment by Etihad Airways to acquire a 49 per cent shareholding in Alitalia, a 75 per cent interest in Alitalia’s loyalty company, which operates the MilleMiglia frequent flier program, and five pairs of slots at London’s Heathrow Airport, which will be leased back to Alitalia on an arm’s length basis. Etihad Airways’ investment will be complemented by a €300m investment from existing core Alitalia shareholders, up to €598m in financial restructuring of debt, and €300m of new loan facilities.

Etihad Airways’ passenger carrying capacity, measured in Available Seat Kilometres (ASK), was 22bn by the end of Q3 2014, an increase of 16 per cent over the same period last year. The airline’s fleet expanded to 105 aircraft, with three aircraft delivered in the third quarter.

Cargo revenue was $284m (Dh1.04bn) in the third quarter of 2014, a year-on-year increase of 16 per cent. Etihad Cargo remains on track to become a billion dollar business in 2014, having reported $804m (Dh2.95bn) in revenue during the first three quarters of the year.

Etihad Airways’ workforce grew to 22,886 employees by the end of the third quarter, up 38 per cent year-on-year. Part of this significant increase can be attributed to the airline’s acquisition of Abu Dhabi Aircraft Technologies LLC (ADAT) from Mubadala earlier this year.