Currency fluctuations, increased competition and reduced travel demand contributed to a 75% fall in half-year profits at Emirates airline.
Net profit for the six months to September 30 fell to $214 million year-on-year while revenue declined y 1% to $11.4 billion.
The Dubai-based carrier said: “This is due to the unfavourable currency environment – where the US dollar continued to strengthen against most other currencies and increased competition resulting in lower average fares.”
Emirates carried 9% more passengers at 28 million during the six-month period.
The group’s dnata arm saw profit decline by 1% to $150 million while revenue rose by 14% to $1.6 billion, partially reflecting “consolidation of major international acquisitions” of the past year.
Dnata’s travel division, which includes UK travel businesses such as Travel 2, Gold Medal and Travel Republic, saw revenue of $404 million – down 13% from the same period last year.
The division’s underlying net sales fell by 14% to $1.4 billion, blamed on “the impact of economic uncertainty and increased price competition in the travel and tourism industry”.
Emirates airline and group chief executive Ahmed bin Saeed Al Maktoum said: “Our performance for the first half of the 2016-17 financial year continues to be impacted by the strong US dollar against other major currencies.
“Increased competition, as well as the sustained economic and political uncertainty in many parts of the world has added downward pressure on prices as well as dampened travel demand.”
He added: “The bleak global economic outlook appears to be the new norm, with no immediate resolution in sight. Against this backdrop, the group has remained profitable and our solid business foundations continue to stand us in good stead.
“In the first six months of this year, both Emirates and dnata continued to grow in capability and capacity.
“Our past investments in product and services are now paying off, enabling us to retain valued clients and attract new customers – reflected in the airline’s passenger growth of 2.3 million.
“We continue to make strategic investments, because we know we have to work even harder for every customer, and make every dollar spent go even further through innovation and driving efficiency across our business.”