Flydubai's profit surges 43% to record $327m on booming travel demand

Annual revenue grew 72% to $2.5bn in 2022, compared with the previous year

Budget airline flydubai carried 10.6 million passengers in its 2022 financial year, up 89 per cent from 2021. Photo: flydubai

Budget airline flydubai's annual profit surged 43 per cent last year on the back of cost-control measures and World Cup shuttle flights, marking its second consecutive year of profitability since the pandemic started.

The sister airline of Emirates registered a record full-year profit of Dh1.2 billion ($327 million) in 2022, it said on Wednesday.

Flydubai's total annual revenue grew by 72 per cent to Dh9.1 billion ($2.5 billion) in 2022, compared with Dh5.3 billion in the previous year, as the number of passengers carried from its Dubai hub soared.

The airline carried 10.6 million passengers in the period — up 89 per cent from 2021.

The record performance is a “direct result of the carrier’s strong business model, as well as its adaptability and agility during challenging times”, said chairman Sheikh Ahmed bin Saeed.

“The carrier was quick to cater to the pent-up demand and support Dubai’s accelerated recovery. Flydubai’s second consecutive year of profitability since the start of the pandemic is testament to the exceptional contribution of its skilled team and the positive environment we operate in, which is conducive to growth.”

The airline's record profit comes amid a surge in air travel demand after the lifting of pandemic restrictions.

The UAE government's management of the pandemic, Expo 2020 Dubai and the regional spillover from the Fifa World Cup in Qatar at the end of last year helped to attract more visitors to the emirate.

Dubai welcomed 14.36 million international visitors in 2022, compared with 16.73 million in 2019, inching closer to reaching pre-pandemic levels, government data shows.

“We realised early on the great opportunities that Dubai provides and remained focused and ready to scale up our operations once the demand for travel returned,” chief executive Ghaith Al Ghaith said.

“2022 has been an exceptional year, with accelerated demand, book-ended by the final few months of Expo 2020 and the unprecedented efforts to support travel to and from the World Cup in Doha.”

Macroeconomic challenges facing airlines — including the continued fluctuation of fuel prices, disruptions to supply chains, rising inflation worldwide and geopolitical unrest — did not dampen flydubai's strong performance last year, he said.

“Our robust cost-control measures, network optimisation, strong yield and the significant fuel efficiencies of our fleet of Boeing 737 Max aircraft have contributed to this historic financial performance,” Mr Ghaith said.

Fuel continues to be the single highest operating cost for the airline with 33.9 per cent of total annual operating costs, due to the increase in fuel prices last year.

In 2022, flydubai launched 16 routes, ending the year with a network of 114 destinations.

The airline had higher connecting traffic, with 46 per cent of passengers connecting through the flydubai network or through its codeshare with Emirates, compared with 34 per cent in 2021, it said.

Flydubai took delivery of 17 new aircraft, a record number of deliveries received in one year in the history of the airline, it said. Growing its fleet by 25 per cent compared to 2021, the airline ended 2022 with 74 aircraft: 32 Boeing 737-800s, 39 Boeing 737 Max 8s and three Boeing 737 Max 9s.

To meet growth in travel demand, flydubai hired 1,300 employees in 2022, 80 per cent of whom are cabin crew, engineers or pilots, its biggest recruitment drive in any single year.

Looking ahead, flydubai is bullish on continued growth.

"Dubai continues to be one of the most desirable destinations for trade and tourism with a robust and growing economy, and a thriving aviation hub serving a growing population," Mr Ghaith said. "Despite the ever-present headwinds that impact the aviation industry, our growth trajectory remains on track."

In 2023, the airline will invest in new technologies, expand its network and continue to hire staff to support its growing operations.

It will grow its in-house engineering and training capabilities, which will bring greater efficiencies and reflect on the bottom line, Mr Ghaith said.

This year, it will take delivery of more than 17 Boeing 737 Max 8 aircraft and boost its sustainability efforts.