‍Air Arabia's H1 Profits Drop 13% Despite Turnover, Passenger Growth

Air Arabia experienced a 13% decline in profits during the first half of the year, even though the airline saw growth in both turnover and passenger numbers. Despite the increase in business, various factors contributed to the profit slump. The airline's financial performance highlights the challenges faced by the industry, where increased operational costs or other economic pressures may outweigh revenue growth and passenger demand.

Air Arabia witnessed a decrease in profit rates despite an increase in turnover and passenger numbers in the first half of the year. Revenues and passenger numbers grew, but profits shrank amid economic uncertainties, currency fluctuations, fuel price volatility, and supply chain disruptions. Air Arabia announced its financial and operational results for Q2 and H1 of 2024, continuing its network expansion and solidifying its market leadership.

In Q2 2024, Air Arabia reported a net profit of AED427m ($116m), a 7% decline from the AED459m ($125m) recorded in the same period in 2023. The airline achieved a turnover of AED1.65bn ($449m), marking a 19% increase compared to last year’s Q2. Over 4.5m passengers traveled with the airline between April and June 2024, reflecting a 19% growth from the previous year, and the seat load factor rose to 79%, up 3%.

Sheikh Abdullah Bin Mohammad Al Thani, Chairman of Air Arabia, noted that the solid net profit in Q2 was driven by strong passenger demand and revenue growth, despite challenges like slower yield growth and rising costs due to economic and geopolitical uncertainties, fuel price volatility, and supply chain issues. He highlighted the resilience of Air Arabia’s business model and management.

In H1 2024, Air Arabia reported a net profit of AED693m ($189m), a 13% decrease from the AED801m ($218m) recorded in H1 2023. The airline’s turnover reached AED3.19bn ($869m), a 13% increase from last year’s AED2.82bn ($768m). Over 8.9m passengers traveled with Air Arabia during this period, a 16% growth from the previous year, with a strong seat load factor of 81%.

Al Thani emphasized Air Arabia’s continued expansion efforts in H1 2024, including fleet growth, new routes, and increased flight frequencies. As the airline moves forward, it remains focused on driving growth, seizing new opportunities, and reducing costs while delivering exceptional value to customers. During H1 2024, Air Arabia added 3 new aircraft to its fleet, bringing the total to 77 Airbus A320 and A321 aircraft.

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Source: arabianbusiness‍