Air Arabia has reported strong results for its fourth quarter and full year of 2021. Despite the effects of the pandemic, the low-cost airline produced an AED 720 million profit for the twelve-month period as it was able to continue its growth strategy, it said on February 15. Air Arabia produces strong Q4 and FY21 results.
When speaking to him at last November’s Dubai Airshow, CEO Adel Al Ali was already in a positive mood for the year. The AED 720 million profit compares to an AED 192 million loss in 2020. The operating profit was AED 643 million versus AED-180 million. Revenues increased to AED 3.174 billion from AED 1.851 billion. The airline, with subsidiaries in Sharjah (UAE), Abu Dhabi, Morocco, and Egypt, carried 6.7 million passengers, up from 4.3 million in the previous year. The load factor was 73 percent.
The fourth quarter produced an AED 467 million net profit compared to AED 20 million in Q4 2020. The quarter was the fifth consecutive at a profit. The operating profit was AED 440 million versus AED 20 million in 2020, with revenues at AED 1.302 billion versus AED 536 million. During Q4 only, the airline carried 2.5 million passengers.
Air Arabia says it benefited from the relaxation of travel restrictions to the UAE, notably Dubai. Abu Dhabi kept a stricter entry policy until November, but in total, demand for traveling into the United Arab Emirates grew, in part spurred by the Dubai 2020 Expo that runs until the end of March. The sustained profitability also demonstrates its business model is strong, Air Arabia says. Al Ali said in November that his airline was benefitting from stronger yields despite operating at a lower capacity.
The carrier added 44 new routes, including six by Air Arabia, seven by Air Arabia Abu Dhabi, sixteen by Air Arabia Maroc, and fifteen by Air Arabia Egypt. The carrier ended 2021 with AED 6.1 billion in equity, up from AED 4.5 billion, with close to AED 4.0 billion available in cash. It reduced its liabilities to AED 7.2 billion from AED 8.1 billion.
Air Arabia grew its fleet very prudently in 2021, adding just a single Airbus A321LR to the five others in operation. It also operates 52 A320ceo’s, of which 39 are based in the UAE, nine in Morocco, and four in Egypt. It still has 73 A320neo’s, 27 A321neo’s, and 20 A321XLRs on order for delivery from 2024. Adel Al Ali said in November he could not have foreseen that this delivery schedule is perfectly suiting him, as his airline didn’t have to add capacity during the Covid-crisis.
The airline is optimistic that further ease of travel restrictions will help the recovery. Its long-term business continuity, cash preservation, cost control, and supporting business growth are key ingredients of its strategy.
