Emirates airline aims this fiscal year to start repaying the Dubai government — its shareholder — the Dh15 billion ($4.1bn) in support that it received to cope with the effects of the Covid-19 pandemic, its chairman and chief executive has said.
The repayments will be in the form of dividends to the government during the current financial year, Sheikh Ahmed bin Saeed said at the Arabian Travel Market in Dubai on Tuesday. The airline's current financial year runs until March 31, 2023.
He did not say how much of the total amount would be repaid this year.
"It was equity to the company, this is why I'm saying ... we will be paying back all that money," he told reporters at a media round table.
Like many of its global peers, Emirates received a capital injection from its Dubai government owner during the two years of the pandemic to weather the effects of the global crisis that at its peak brought international travel to a near standstill.
The state-owned airline will begin repaying the amount as air travel demand rebounds.
Emirates will reach 100 per cent of its capacity by the end of the year, up from the 75 per cent to 80 per cent of pre-pandemic levels at which it is currently operating, Sheikh Ahmed said.
The airline, which previously said it would return to annual profitability in 2023, is profitable so far in its current financial year, the chairman said.
"I see Emirates at the start of the financial year until today, they are doing good, they are profitable and so far, so good," he said. "We hope that by the end of the financial year to make profit and also pay our owner back."
Sheikh Ahmed expects the Fifa World Cup hosted by Qatar this year to have a positive spillover effect that would benefit Dubai and the region.
"We hope that it will be a successful event and everybody in the region will be able to benefit from that," he said. "We hope that many people visiting Qatar for the World Cup will be able to come and stay here, travel from here to Qatar back and forth."
Dubai's hospitality industry, which has more than 130,000 hotel rooms, is one of the sectors that stands to benefit.
Sheikh Ahmed said: "I'm sure Dubai should do very well because they have the hotel rooms, we're talking about 130,000-plus rooms in Dubai, that could be something that would help Doha, the game, visitors and logistics people to tap into Dubai and the facilities here."
Sheikh Ahmed suggested that demand would be able to withstand the higher oil prices in the market.
"When you think of the supply of fuel and how expensive it is, yes it will always be reflected on the airline," he said. "It is not the first time that something like this happened — we saw oil prices at $140 a barrel years ago and we saw prices as low as $50 to $60."
Emirates remains bullish on pent-up demand for travel and has started repair work on one of its two runways a year earlier in anticipation of rising demand as markets around the world ease their Covid-related restrictions, Sheikh Ahmed said.
"This is why we time it between now and the peak of the summer traffic," he said. "It is early by one year."
The refurbishment of the northern runway at the Dubai International Airport began on Monday and is set for completion on June 22. As a result of the work, the world’s busiest international airport will be reduced to a one-runway operation.
Emirates is hiring more staff across every segment of the company from cabin crew to ground handling and its training centre is at maximum capacity, Sheikh Ahmed said. Staffing stands at about 80 per cent of pre-pandemic levels.
The airline has an appetite to hire 8,000 to 10,000 crew to operate its A380 superjumbos but is constrained by how soon it can rehire some of the pilots it let go, retrain staff and cope with the changes in the labour market after the pandemic, Emirates airline president Tim Clark said in March.
Meanwhile, Sheikh Ahmed said he has not had any discussions with the Dubai government regarding a public listing of the Emirates group's business units.
"I will always leave it to the government of Dubai to decide which company or which sector [will be listed]," he said.
Dubai, which aims to boost its stock market amid a growing appetite for initial public offerings in the region, revealed plans last year to list 10 state-owned companies as part of its strategy to double the size of its capital market to Dh3 trillion and attract foreign investment.
In terms of the fleet, the airline will have to adjust plans for phasing out older aircraft to deal with further delays by US plane maker Boeing to the first deliveries of its new 777X models, Sheikh Ahmed said. However, Emirates has not reached a stage of talking to the manufacturer about compensation for the delays, he said.
Boeing anticipates deliveries will begin in 2025.