Record growth in routes last year helped the budget carrier flydubai increase its profit by more than 12 per cent to post earnings of Dh250 million.
The carrier, which will operate a fleet of 50 aircraft by the end of this year, carried 7.25 million passengers in 2014, with the strongest passenger growth recorded in Central Asia.
“The results show that the recent order for more aircraft, as well as investments in the offering on the ground and in the air, have been the right strategy for the airline,” said the chairman Sheikh Ahmed bin Saeed Al Maktoum.
Flydubai, which started operations in 2009, reported a 19.1 per cent increase in revenue to Dh4.4 billion for the year ending on December 31.
The carrier added 23 new routes over the course of the year, taking its destinations to 86.
It also increased the frequency of flights to Beirut, Kuwait, Muscat, Salalah, and Tbilisi, the capital of Georgia.
It said that fuel remains the single largest expense at 36 per cent of its total operating costs, although it had benefited from a drop in fuel prices in the fourth quarter of last year.
Flydubai said that it is currently hedging 30 per cent of its fuel requirements for this year. Fuel hedging has become a common practice among airlines in recent years amid volatile energy prices.
Flydubai said that fees from in-flight entertainment, sales, seat preferences and checked baggage allowance had contributed to about 14.4 per cent of its revenue last year.
Revenue from cargo operations rose 11.8 per cent in 2014 versus 2013, with expectations to start new cargo routes in Europe after securing special EU certification.
Flydubai, which currently operates out of Terminal 2 at Dubai International Airport, may need more room to grow, according to analysts.
“The challenge now is to make a decision as to whether flydubai’s future growth could be expanded even faster by moving to the added and vacant capacity at Al Maktoum International Airport at Dubai World Central,” said Saj Ahmad, the chief analyst at StrategicAero Research.
“This will be critical for the airline as it looks to maintain its leadership in the GCC market, especially as it awaits its fleet of 100 new 737 Max 8 jets to support its expansion plans.”
selgazzar@thenational.ae
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