Air Arabia to expand global network in 2021 after 90% fall in Q4 2020 net profit

Air Arabia is looking to continue expanding its network this year despite the challenges posed by the coronavirus pandemic, the company’s chairman, Sheikh Abdullah Bin Mohamed Al Thani, said.

The airline’s net profit for the fourth quarter of 2020 plunged 90 percent to 20 million dirhams ($5.4 million) compared to a year earlier, while turnover sank 53 percent to 536 million dirhams.

In a statement to the Dubai Financial Market (DFM) on Thursday, the airline said it managed to register a profitable fourth quarter and limited its net loss for the full year 2020 to 192 million dirhams, despite the downturn in the global air travel industry.

 

“While the year 2021 continues to be a challenging one for the industry, we remain confident about the fundamentals of the aviation sector and the vital role air travel will continue to play in economic recovery,” said Sheikh Abdullah Bin Mohamed Al Thani, chairman of Air Arabia.

“We remain focused on adopting further measures to help improve the overall cost structure of the group and will continue to gradually resume operations where possible” he added.

Worst hit

The aviation industry has been among the worst hit by the coronavirus pandemic, with airlines losing billions of dollars in 2020 alone due to the massive decline in passenger numbers.

Tim Clark, the head of Emirates Airlines said this week the industry will continue to feel the impact of the pandemic this year as many jurisdictions have tightened restrictions amid the resurgence of infections.

“I think probably we are going to see some difficulties. We are not going to see capacity return that I hope in July and August, I think, maybe [it will return] in the last quarter this year,” Clark was quoted by Reuters as saying.

Air Arabia in 2020

Last year saw the launch of Air Arabia Abu Dhabi through an agreement with Etihad Airways and Air Arabia to establish the UAE capital’s first low-cost carrier. The airline marked its first flight to Alexandria in July, followed by the launch of eight additional routes from Abu Dhabi International Airport.

Air Arabia also added a total of 14 new routes to its global network in 2020 from its operating hubs in UAE, Morocco and Egypt.

In November, the carrier launched direct flights between Sharjah and Tashkent, followed by the launch of flights from Casablanca to Rennes and Guelmim in December. 

A new route to Malaga from Casablanca and Nador was also added, as well as nine others that originate from Abu Dhabi International Airport to Alexandria, Cairo, Sohag, Dhaka, Kabul, Chattogram, Khartoum, Muscat and Salalah.

Al Thani said the cost-control measures they implemented last year, coupled with the redeployment of its fleet in various routes, have helped curb the airline’s losses.

“The early measures taken by the management team to control overall cost and the gradual resumption of flights, albeit a limited number of destinations, has helped register a profitable fourth quarter while significantly reducing the net loss expected for the full year,” he said.

 

Source: https://www.zawya.com/mena/en/markets/story/Air_Arabia_to_expand_global_network_in_2021_after_90_fall_in_Q4_2020_net_profit-ZAWYA20210211081855/

 

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