Sharjah-based budget carrier Air Arabia reported a 42 per cent jump in net profit, beating analyst expectations, as the airline opened new destinations and carried more passengers in the first quarter.
The UAE’s only listed airline reported a net profit attributable to equity holders of Dh111 million for the three months ending March 31, compared with Dh78m in the same period a year earlier, the company said in a statement.
Bahrain-based Securities & Investment Company had forecast a first-quarter net profit of Dh85.3m.
Revenue for the period was up by 7 per cent to Dh946m.
Passenger numbers grew by 17 per cent for the quarter to 2.1 million. The average seat-load factor, a measure of filled seats compared to available seats, stood at 81 per cent.
Air Arabia’s continued expansion into central Europe has allowed the airline to tap into new growth markets and connect new “city pairs” that previously didn’t exist, said Saj Ahmad, the chief analyst at the UK’s StrategicAero Research.
“This has had the double effect of growing passenger numbers while it has also helped mitigate against fluctuations in regional demand, which in some markets has been strained or challenging given the wars and refugee crises in places like Syria, Lebanon, Yemen and other disruptive developments in other areas like Egypt, Jordan and Saudi Arabia,” Mr Ahmad said.
The airline also said that it was able to offset macroeconomic challenges through operations efficiency and the addition of new routes. During the first quarter of this year, Air Arabia started flights from its Sharjah hub to Sarajevo, the capital city of Bosnia and Herzegovina. It also plans to start seasonal direct flights from Sharjah to Batumi, Georgia, between July and September.
Air Arabia started flights to Fez from , its hub in Morocco, Casablanca, and in France it started flights to Pau and Toulouse. It also started flying from its hub at Amman airport to Riyadh.
In 2014, Air Arabia opened its second hub in the UAE and fourth worldwide at Ras Al Khaimah International Airport following a long-term strategic partnership with Ras Al Khaimah’s Department of Civil Aviation.