Etihad Airways reports $1.7 billion operating revenues in H1

Etihad Airways

ME Business

Etihad Airways has provided details of its half-year 2020 performance, which saw a strong start to the year, with the airline progressing well ahead of its transformation plan targets.

In a statement by the airline on Thursday, Core operating loss for this period increased by US$172 million to US$758 million, driven by a 38 percent drop in revenues, which stood at US$1.7 billion. This was partially off-set by a 27 percent reduction in direct operating costs to US$1.9 billion, and a 21 percent reduction in general and administrative expenses to $0.40 billion, both driven by management cost containment initiatives and reduced operations.

Etihad carried 3.5 million passengers in H1, a reduction of 58 percent from the same period the previous year. Average seat load factor was 71 percent.

Available Seat Kilometres reduced by 53 percent to 23.69 billion.

Cargo revenues were $0.49 billion, an improvement of $130 million (37 percent) compared to the same period in 2019, with 254,345 leg tonnes of cargo carried. This was driven by an increase in demand and a spike in cargo fares.

The core operating result for the first three months of the year improved by 34 percent, despite the onset of COVID-19, with a 12 percent reduction in passenger numbers, and a 9.5 percent reduction in Available Seat Kilometres.

Q1 seat load factor was 74 percent (January’s performance was significantly stronger than the same month in 2019, with a seat load factor of 81.9 percent), and yield at $5.92 cents. Unit revenue in Q1 reduced by 3.3 percent to $4.14 cents, offset by continuous focus on driving down unit costs, which were reduced by 2.4 percent to $7.01 cents.

Commenting on the airline's performance, Tony Douglas, Group CEO of Etihad Aviation Group, said, "Etihad faced a set of enormous and unpredictable challenges in the first six months of the year. We started 2020 strong, and recorded encouraging results as part of our continuing transformation programme. This left us in a relatively robust position when COVID-19 hit, allowing us to act with agility, and to mobilise all available resources as the crisis deepened, taking major steps to reduce costs through a wide-reaching series of measures."

"While we have revised our outlook for the rest of 2020 based on current realities, we remain optimistic that as international borders re-open, we will increase our flying and carry more guests securely and with greater peace of mind, supported by the Etihad Wellness programme and our new Wellness Ambassadors. By September, we aim to increase our worldwide flights to half our pre-COVID-19 capacity," he added.

Etihad operated up to 40 of its fleet of 97 passenger aircraft in Q2, including Boeing 787 Dreamliners, 777-300ERs, and Airbus A320 family aircraft as belly-hold cargo freighters to complement Etihad Cargo’s operational fleet of six 777-200F freighters.

Between 25th March and 15th June, over 640 special passenger flights were operated to 45 online and offline destinations, using the passenger cabins of these aircraft to fly foreign nationals out of the UAE, and to bring UAE nationals back home.

For his part, Adam Boukadida, Chief Financial Officer of Etihad Aviation Group, commented, "This year started strong, riding on the positive momentum gained in 2019, and by the end of the first quarter, the airline was on track to achieve a 2020 EBITDA of $900 million (2019: $453 million). Etihad managed to maintain a satisfactory level of liquidity despite a major drop in revenues, while continuing to raise new liquidity facilities supported by local and international financial institutions.

"This was supported by maintaining an ‘A with a stable outlook’ Fitch rating in April, at the height of the pandemic. Etihad was one of a small number of airlines to maintain its pre-COVID-19 credit rating."

Etihad is gradually resuming services to more destinations across its global network. This follows the easing of travel restrictions by UAE regulatory authorities on outbound and inbound travel for citizens and residents. All travel remains subject to the entry and health regulations set by the UAE authorities, and those at the end destination.

Throughout August and September, subject to the lifting of international restrictions and the re-opening of individual markets, the airline aims to fly to 61 destinations worldwide from its Abu Dhabi hub, operating approximately 50 percent of its pre-COVID capacity.

Etihad and Etihad Cargo operated special humanitarian services to 60 cities around the world, 40 of which are not currently served by the airline’s passenger or cargo network of flights To protect its customers, Etihad launched ‘Etihad Wellness’, a comprehensive health and hygiene programme, building on the stringent measures already put in place to deal with COVID-19, and which is now a major component of the airline’s long-term customer strategy.

The launch of the programme was championed by the introduction of specially trained Wellness Ambassadors, a first in the industry, who provide essential travel health information and care online via webchat, at Abu Dhabi International Airport, and in-flight, so guests can fly with greater peace of mind.

In June, Etihad also launched a partnership with Austria-based healthcare technology company, Medicus AI, to launch a COVID-19 risk-assessment tool that will empower guests to make informed decisions about travelling.

Etihad continues to be a leader, together with its partners in the UAE and around the world, in pioneering new and effective ways of mitigating aviation’s environmental impact. The sustainability strategy of the Etihad Aviation Group is aligned to the 17 Sustainable Development Goals of the United Nations.

In January, in the presence of the EU Commission Etihad announced our commitment of zero net carbon Emissions by 2050 and halving of 2019 emissions by 2035.