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flydubai Announces Fourth Full-Year Of Profitability And 25% Increase In Passenger Numbers
(10 February 2016)

 

flydubai today reported profits of AED 100.7 (USD 27.4 million) for 2015 following a stronger second half-year which saw increased numbers of passengers travel across its network.

Total revenue for the full year was AED 4.9 billion (USD 1.33 billion), an increase of 11% compared to 2014. The overall yield, in terms of fils per Revenue Passenger Kilometre (RPKM), was under pressure attributable to the strong dollar; the challenging trading environment across the network; disruption resulting from the suspension of flights on some established routes and a large number of recently launched routes with a lead time required to reach maturity.

His Highness Sheikh Ahmed bin Saeed Al Maktoum, Chairman of flydubai, said: “2015 was an important year for flydubai. It was a year in which through determination and commitment we continued to realise our vision to increase connectivity in support of the UAE’s economic development. The year culminated in two achievements: the delivery of our 50th aircraft; and our fourth full-year of profitability.”

Ghaith Al Ghaith, Chief Executive Officer (CEO) of flydubai, added: “The overall trading environment has remained challenging but we have maintained our growth story and ended the year positively. Our robust passenger growth of 30%, in terms of RPKM, underlines the demand for travel within our geographic focus; the continued appeal of Dubai as a destination; and the popularity of our service.”

Cost performance

A stronger performance in the second half of the year coupled with cost management efforts has resulted in a positive end to the year.

Fuel costs reduced to 30.3% of operating costs benefitting from lower fuel prices with 59% of fuel costs unhedged. In line with flydubai’s active fuel hedging policy, 16% of the fuel requirements for the next 24 months are currently hedged. This will provide a level of certainty and control to its fuel costs due to the ongoing fluctuation in fuel prices.

EBITDAR reduced slightly compared to the previous year, but remained healthy at 20.5% of revenue.

The closing cash and cash equivalents position, including pre-delivery payments for future aircraft deliveries, was robust at AED 2.4 billion.

Ghaith Al Ghaith, CEO of flydubai, commenting on flydubai’s cost performance, said: “The solid foundation we laid when the airline launched has ensured that we are best placed to respond quickly to manage the challenging socio-economic environment, in a controlled manner, both in the short term and for the long term.”

Operational performance

Ready for business: Business Class was introduced on 17 new routes in 2015 representing 87% of all departures from Dubai. flydubai saw the number of passengers from across its network who travelled in Business Class increase by 72% compared to 2014. Highest demand came from Africa followed by the Subcontinent and the Middle East, highlighting the demand for business class air travel, especially in the markets that have not had access to this service before. Demand for this service is also reflected in the UAE’s position as an internationally recognised centre for business and trade.

Driving demand at second hub: the start of flydubai’s new operations at Al Maktoum International-Dubai World Central saw services become available to Amman, Beirut, Doha, Kathmandu and Kuwait while flights to these destinations continued to be available at Dubai International. Services started on 25 October 2015 and during these first 10 weeks of operations passengers welcomed the choice and convenience offered by the new airport. Al Maktoum International-Dubai World Central continues to provide passengers from across Dubai with increased opportunities for travel.

Creating free flows of trade: increased accessibility to previously underserved markets has benefited cargo revenues which remain strong, posting an increase of 28.4% with 40,441 tons carried during the year.

Increased spending aids ancillary revenue: continued strong performance for pre and onboard sales including inflight entertainment, food, seat preferences, checked baggage allowance, car rental, hotel bookings, travel insurance and visa facilitation services contributed 15.1% of revenue. The introduction of new technology has provided more flexibility and opportunity to increase sales.

Growing in experience and talent: in support of its growing fleet flydubai staff numbers rose to a total of 3,393 including 658 pilots, 1,435 cabin crew and 273 engineers representing 114 nationalities. This is a reflection of the opportunity created by opening previously underserved markets and flydubai’s ability to attract some of the best talent in the aviation industry.

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