Emirates Airline reports record annual profit

Emirates Airline on Tuesday reported a record net profit of $1.9b for 2015-16, underlining how it is thriving as one of the most disruptive forces in global aviation. The fast-growing Dubai-based airline recorded a robust performance even as it was hit by the negative effects of a strong US dollar and economic slowdowns in oil-producing countries. State-controlled Emirates, founded in 1985, has over the past 20 years put pressure on longer established airlines in Europe and Asia, and is now increasing its presence in the US. This has prompted some of these airlines to demand actions by governments against Emirates and the other fast-growing Gulf carriers — Etihad Airways and Qatar Airways. In the most recent dispute, US carriers last year claimed the three Gulf carriers had received $42bn in hidden subsidies over the past decade, and said these violated aviation agreements between the US and the UAE and Qatar. The Gulf carriers deny the claims.<br/>For the year to March 31, Emirates reported a net profit of Dh7.1b ($1.9b), up 56% compared with 2014-15, as its fuel bill fell 31% because of the sharp decline in oil prices. However, Emirates’s revenue fell 4% to Dh85b, partly because of the US dollar’s strength against other currencies. This is because the Dubai dirham is pegged to the dollar, and Emirates records significant sales in Asian and European currencies. Sheikh Ahmed bin Saeed Al Maktoum, Emirates chairman, said the fall in oil prices was a “double edged sword” — a boon for operating costs, but a bane for business and consumer confidence. “Looking at the year ahead, we expect that the low oil prices will continue to be a double-edged sword . . . The strong US dollar against major currencies will remain a challenge, as will the looming threat of protectionism in some countries.”<br/>