The Middle East's largest low-cost airline Air Arabia recorded an eight-fold surge in first-quarter net profit as air travel demand recovered amid a relaxation of pandemic-induced curbs worldwide.
Net profit stood at Dh291 million ($79.23m) in the first three months of 2022, Air Arabia said on Wednesday. The airline's turnover in the first quarter rose 97 per cent to Dh1.12 billion.
“The strong performance we witnessed last year continued in the first quarter of 2022 and was supported by higher customer demand for Air Arabia’s value driven product as well as rigid cost control measures that the airline took since the start of the pandemic,” said Sheikh Abdullah bin Mohammad Al Thani, chairman of Air Arabia.
The airline carried more than 2.4 million passengers between January and March 2022, up 86 per cent annually.
Average seat load factor — or passengers carried as a percentage of available seats — during the first quarter stood at 79 per cent, up 4 per cent compared to the same period in 2021.
The UAE's only listed airline added four new routes from its hubs in the UAE, Morocco and Egypt in the first three months of 2022. It also confirmed that its two new ventures, Fly Arna in Armenia and Fly Jinnah in Pakistan, are expected to be operational by midyear.
“In addition to the lasting impact of Covid-19 on global aviation, the industry continues to face geopolitical challenges, higher oil prices and uncertainty towards full economic recovery,” Sheikh Abdullah said.
“Although all these challenges are of a changing nature, we have full confidence in the business model that we operate, the strength of the aviation industry worldwide, as well as its role in supporting regional and global economic recovery.”
Pent-up air travel demand is boosting the aviation industry as pandemic-related travel curbs ease worldwide, the International Air Transport Association (Iata) said.
Total traffic in March 2022 — measured in revenue passenger kilometres or RPKs — was up 76 per cent on March 2021, the aviation trade body said in its monthly report.
Air Arabia is “optimistic” about the financial outlook for 2022 as it expects air travel demand to remain strong this year and next, after two years of dampened appetite during the pandemic, Adel Ali, group chief executive of Air Arabia, told The National at the Arabian Travel Market in Dubai on Tuesday.
“The business seems to be good and yields are on the right side,” he said.
“Fuel is a challenge always when there is a conflict … a good oil price is good for the region because the economy is good and people will have more disposable income to travel.”