Air Arabia second-quarter profit falls 44%

Budget carrier Air Arabia said on Sunday net profit for the second-quarter fell 44 per cent, hit by declining yields hurting airlines globally and higher fuel prices and falling short of most analysts forecasts. Air Arabia made a net profit of Dh50 million, down from Dh90m in the second quarter of 2009, the company said in a statement. Turnover increased by 6 per cent to Dh485m, while passenger numbers were up 11 per cent to 1.1 million in the period, it said. Average seat load factor, an industry benchmark, increased by 4 per cent to 82 per cent, against the year-ago period. "This decline in profitability was in line with global industry performance, which continues to be impacted by changing market dynamics, characterised by increase in fuel costs and continuous pressure on yield margins," it said. Analysts expected a profit of Dh43m to Dh91m in a Reuters survey in July. The Arab World's largest listed airline, set up in 2003 in Sharjah in the UAE, has a hub in Morocco and recently launched operations in its third hub in Egypt. The carrier is focused on further expansion, it said. Air Arabia services 65 routes across Europe, the Middle East, Africa and Asia from its three hubs. The airline announced in June the launch of Jordan's first low-cost carrier, to serve as its fourth regional hub, as part of its expansion plans. Air Arabia shares closed unchanged earlier on Sunday, outperforming Dubai's bourse, which fell 1.6 per cent.