Etihad posts first net profit
from aviationweek.com
Etihad Airways turned a net profit for the first time in its eight year history, reporting 2011 net earnings of $14 million and an operating profit of $137 million on a strong increase in sales.
CEO James Hogan says the airline has reached a new phase of its development, a period of being established as a self-sustainable business following the initial startup phase, the putting in place of processes and strategies and acquiring a major aircraft fleet. The strategy was about “organic growth,” Hogan says, but he is also still looking at acquisitions “where it makes sense.” Etihad bought a 29% stake in Air Berlin last December and a 40% in Air Seychelles in January. The airline also was rumored to be interested in Virgin Atlantic and/or Aer Lingus, which Hogan was unwilling to confirm.
Etihad’s revenues increased by more than $1 billion to $4.1 billion last year. The airline boosted capacity by 15.8%, but still managed to improve yields by 7%. Passenger numbers were up 17% at 8.3 million, and load factor came in at 75.8%, up 1.8 percentage points from 2010.
The number of aircraft in its fleet increased by seven to 64. The airline plans to take delivery of at least 100 aircraft in the next 10 years. It also has 105 options and purchase rights.
Unit costs in 2011 were down 4.6%, excluding fuel, and declined 16.6% in the past two years, representing annual savings of $187 million.
According to Hogan, Etihad has no plans to join one of the global alliances at this point, and the Abu Dhabi government has not given any indications about a possible initial public offering.
Hogan expects revenues in 2012 to exceed $5 billion and sees a further improvement in profitability. Etihad has hedged 77% of its fuel needs for this year, 50% for 2013 and 25% for 2014. “We are one of the better hedged airlines in the world,” he believes.