Etihad reports revenue growth ahead of capacity, continuing road to profitability

Press release
Published January 12th, 2011 - 10:12 GMT
Etihad Airways
Etihad Airways

Etihad Airways today reported a 29.2 per cent rise in revenues in 2010 to US$ 2,951 million (2009: US$ 2,285 million), significantly outpacing its capacity growth, which saw available seat kilometres (ASKs) rise 19.5 per cent to 45.1 billion (2009: 37.8 billion).  

The result marked continued progress towards the airline’s goal of break-even in 2011 and profitability in 2012.  

Passenger numbers topped seven million for the first time, up 13.1 per cent to 7.099 million, while seat factors increased by 0.5 percentage points, to 74.0 per cent. 

Revenue passenger kilometres (RPKs) rose 20.1 per cent from 27.8 billion to 33.4 billion.

The airline confirmed that, as previously forecast, it had reported a positive EBITDAR (earnings before interest, taxation, depreciation, amortisation and rentals) for the full year, the first time it had achieved this since it was formed in 2003. 

James Hogan, Etihad Airways’ Chief Executive Officer, said: “This is a result to celebrate.  In a year in which we dealt with the continuing effects of global recession, erupting volcanoes, riots in Thailand, and severe weather across Europe at one of our busiest times of year, we were still able to deliver an impressive performance. 

“We continued to invest in routes and infrastructure, adding seven new destinations during the year, as well as welcoming more than 800 new employees to the Etihad family.  Yet despite this, we brought our costs down whilst increasing passenger numbers and yield. 

“On top of all of this, we were delighted when our investment in product and customer service was recognised when we were named the World’s Leading Airline for the second year running.”

Etihad launched services to Alexandria, Baghdad, Colombo, Erbil, Nagoya, Seoul and Tokyo in 2010, as well as opening new premium lounges in Dublin and Manchester.  Its fleet increased by six to 57 aircraft. 

In August, the company announced a major new partnership with Virgin Blue, allowing the two airlines to offer a joint network of more than 100 destinations, as well as integrating their frequent flyer programs. 

The airline’s cargo division performed particularly strongly in 2010, with revenues up 57.4 per cent over 2009.  This was bolstered by the airline’s developing route network as well as investment in dedicated freighters.  Etihad took delivery of two Airbus A330-200 freighters during the year, which joined its existing fleet of four cargo-only aircraft. 

Mr Hogan said the airline’s cost management program was an important element of its performance during the year.  He said: “We began a cost reduction programme in 2010 to identify US$250 million of annualised cost savings.  I am delighted to say that thanks to the focus of our management team and operational staff, we have found more than US$320 million of savings, beating our own target and bringing even greater efficiency to the airline.” 

Mr Hogan said the outlook for 2011 was strong, with global operating conditions continuing to improve. 

“We are seeing a growing confidence in many of our international markets, pointing to a strong performance in 2011.  Premium travellers are returning, particularly on our ‘trunk routes’ into Europe, Asia and Australia, and forward bookings look positive.  We are seeing, already, particularly strong benefits from our Virgin Blue alliance. 

“We are also seeing results from the investments in tourism in Abu Dhabi itself, with growing numbers of our guests choosing the emirate as their final destination.

“We are confident we will achieve our goals in 2011, further developing the commercial success of the world’s leading airline.”

Background Information

Etihad Airways

As an airline, Etihad has come a long way in a short time – just like its home Abu Dhabi. 

The airline was established by Royal (Emiri) Decree in July 2003 and is wholly owned by the Government of Abu Dhabi with a mandate to operate safely, commercially and profitably.

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