BUSINESS NEWS
Emirates to pursue expansion plans despite Gulf crisis
Emirates reported it had restored 96% of its network and three-quarters of its schedule last week and insisted it would press ahead with expansion plans despite the crisis in the Gulf. The carrier dismissed fears
of fuel shortages as it reported results for the 12 months to March, insisting it has enough fuel to restore operations fully. Emirates chair Sheikh Ahmed
bin Saeed Al Maktoum said the carrier had secured fuel for its “current operations and scaling up to pre-disruption levels” and
Emirates profits rose 7% in year to March
Amadeus and Sabre Q1 results reflect impact of Iran conflict
insisted the airline’s “very strong cash reserves enable us to progress with our plans without knee-jerk cost-control measures”. The airline recorded full-year
revenue of $35.7 billion and a pre- tax profit of $6.2 billion, up 7% year on year – with the Emirates Group recording $6.6 billion in profit, also up 7%, from $41 billion in revenue. Dnata revenue rose 12% year on
year to $6.4 billion and profits to $437 million, up 2% on 2025.
Leading travel technology groups Amadeus and Sabre reported strong starts to the year before the US and Israel launched attacks on Iran on February 28. Amadeus – led by
president Luis Maroto (pictured) – noted “strong growth” early this year “moderated” due to the crisis, leaving first-quarter revenue up 3.1% at €1.68 billion and profits broadly flat year on year at €357 million. The group’s air distribution
revenue grew just 0.1% year on year in the three months to March despite
“a very strong start to the year both in volumes and average revenue per booking” as the crisis in the Middle East caused “a spike in cancellations”. Rival Sabre reported
first-quarter revenue
growth of 8% year on year to $760 million and a 6%
increase in air bookings, leaving a
net profit of $8 million. Sabre president and chief
executive Kurt Ekert noted the war and increased fuel prices “weighed on near-term air bookings” but said: “Our outlook assumes the conflict subsides during the second quarter.”
Carriers downplay fuel concerns Ian Taylor
British Airways’ owner International Airlines Group (IAG) and the Lufthansa Group insisted they have adequate supplies of jet fuel last week and downplayed the risks of disruption to summer flights. IAG reported “we currently see
no issues with fuel availability in our main markets” as it published first-quarter results for the three months to March. The group noted: “The higher
fuel price will inevitably lead to lower profit this year.” But it insisted: “We’re confident
of jet fuel supply in our main markets throughout the summer. Today, the situation is more about the price of fuel than availability.” However, it acknowledged: “If the current conflict continues to restrict
travelweekly.co.uk
flows of crude oil and jet fuel from the Middle East, there is the potential for supplies of jet fuel to be restricted on a global basis. We expect it to have a more substantial impact throughout the rest of the year.” IAG reported it has cut its
capacity growth plans from 3% to 1% for April to June and 2% for July to September. The group forecast its full-year fuel
bill would be up to €2 billion more than the €7 billion previously forecast but said: “We expect to recover around 60% of the higher cost.” It reported first-quarter revenue
of €7.18 billion, up almost 2% year on year, and a quarterly profit of €351 million, up 77% – of which BA contributed €186 million. Lufthansa chief executive Carsten
Spohr hailed record first-quarter revenue of €8.7 billion, up 8% on the previous year, but warned: “The
ongoing crisis in the Middle East poses enormous challenges.” He reported “a strong surge in
demand in March following capacity reductions via Middle Eastern hubs [which] overcompensated for the fact that some destinations in the Middle East could no longer be served” and said this “strong demand was reflected in higher yields” in premium cabins. Lufthansa chief financial
officer Till Streichert insisted: “No BA parent IAG has raised its forecast full-year fuel bill by €2 billion
restrictions in kerosene supply are currently expected at any of the Lufthansa Group hubs.” Spohr acknowledged a risk of
“potentially reduced fuel availability later in the year”, but said: “Currently, we don’t see any bottleneck in supplies through June.” Streichert said Lufthansa expects
to recover 60% of its additional fuel costs through increased fares from April to June and “more than 100%” in the peak summer quarter.
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