Etihad Airways reports 48 pct increase in profit for 2013

Written by fe Bureau | Mumbai | Updated: Mar 4 2014, 00:47am hrs
EThe seat factor for the airlines stood at 78% in 2013. Reuters
Abu-Dhabi-based Etihad Airways on Monday reported a 48% increase in its net profit which stood at $62 million for 2013, on the back of successful partnership strategies and expansions.

This is the third consecutive year that the airline has posted a profit, amidst volatility in a sector which is used to seeing airlines post huge losses in its financial results.

The state-owned carrier also reported a 27% increase in its revenue to $ 6.1 billion for 2013 from $ 4.8 billion in 2012.

"A key driver of Etihad Airways growth in 2013 was its partnership strategy, based on wide-ranging code shares and its unique approach of minority equity investments in strategically important airlines, said an airline release.

"This strategy delivered revenues of $820 million in 2013, up 30% (from the last fiscal), and represented 21% of total passenger revenues for Etihad Airways, it added.

The middle-eastern airline also reported a 30% increase in EBITDAR (earnings before interest, tax, depreciation, amortization and rentals) to $979 million, during the same period.

The seat factor for the airlines stood at 78% in 2013.

"We have hit every financial target for each of the last seven years, bringing sustainable profitability to a business which has grown from just US$300 million in revenues in 2005 to more than US$6 billion today, James Hogan, President and Chief Executive Officer of Etihad Airways, said.

Etihad currently owns equity stakes in seven airlines Airberlin, Air Seychelles, Virgin Australia, Aer Lingus, Jet Airways, Air Serbia, and Switzerland based Darwin Airline.

The Competition Comission of India (CCI) had last November cleared Etihad to pick up 24% stake in Jet Airways for about Rs 2058 crore.

The Gulf carrier is now in talks with Italy's struggling Alitalia on an investment.

The due diligence process regarding the equity investment is currently underway, said Hogan at a press conference on Monday.

"Our code share partnerships have been an important part of our business performance for the last seven years. But it is our equity investments which are really taking off now, allowing us to build integrated networks and schedules, develop common products and services and most importantly, identify business and cost synergies, he added.

The airline said that it raised $2.14 billion on the commercial markets in 2013, primarily for fleet development.

Etihad is set to receive 18 new aircraft including its first Boeing 787-9 Dreamliner and its first Airbus A380 super jumbo during October-December 2014.