Etihad Airways, the national carrier of the United Arab Emirates, today announced record financial results for 2013, with net profit up 48 per cent to US$62 million on revenues up 27 per cent to US$6.1 billion.
The record performance also saw earnings before interest and tax (EBIT) up 22 per cent to US$208 million and earnings before interest, tax, depreciation, amortisation and rentals (EBITDAR) up 30 per cent to US$979 million, a margin of 16 per cent of total revenues.
This marked the third successive year of net profitability, in the airline’s tenth year of operation.
James Hogan, President and Chief Executive Officer of Etihad Airways, said:
“This is another important step forward in our journey as a growing, commercially successful business. 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.
Revenue increased by 27 per cent to US$6.1 billion (2012: US$4.8 billion), on passenger numbers up 12 per cent 11.5 million (10.3 million).
Revenue Passenger Kilometers (RPKs) – measuring passenger journeys – increased by 16 per cent to 55.5 billion (47.7 billion), while Available Seat Kilometers (ASKs) – representing capacity – grew by 17 per cent to 71.1 billion (61 billion).
These figures reflected strong growth in passenger traffic volumes, in a year when Etihad Airways added six new destinations – Washington DC, Amsterdam, Sao Paulo, Belgrade, Ho Chi Minh City and Sana’a – and increased capacity on 18 existing routes. At year’s end, the average network-wide seat load factor was 78 per cent, unchanged from 2012.
The airline has announced nine new destinations for 2014 – the US cities of Los Angeles and Dallas-Fort Worth, the European gateways of Rome and Zurich, Jaipur in India, Perth in Western Australia, Phuket in Thailand, Medina in Saudi Arabia and Yerevan in Armenia.
A key driver of Etihad Airways’ growth in 2013 was its partnership strategy, based on wide-ranging codeshares and its unique approach of minority equity investments in strategically important airlines. This has accelerated network growth, giving it the largest route network of any Middle Eastern carrier, reaching almost 400 destinations; boosted sales and marketing opportunities in key markets around the world; and allowed significant business synergies and cost savings.
This strategy delivered revenues of US$820 million in 2013, up 30 per cent (US$629 million), and represented 21 per cent of total passenger revenues for Etihad Airways.
Mr. Hogan said: “Our codeshare 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. These synergies are outstanding. Our joint purchasing taskforces are delivering real and significant savings across all equity alliance members, giving each of us real competitive advantage through lower unit costs.”
In addition to its four existing equity partners – airberlin, Air Seychelles, Virgin Australia and Aer Lingus – Etihad Airways announced investments in three additional carriers in 2013.
In accordance with its shareholder mandate to operate as a fully commercial entity, Etihad Airways continued to build its portfolio of financing partners, increasing from 60 in 2012 to more than 70 in 2013. The airline raised US$2.14 billion on the commercial markets in 2013, bringing its total to almost US$9 billion, primarily for fleet development.
At the close of 2013, Etihad Airways employed 13,535 employees in the core airline business, an increase of 27 per cent over the 10,656 in 2012. Including the new Etihad Airport Services subsidiary, the group employed a total of 17,603 people from 142 nationalities.