The Emirates Group has posted a massive $US3.8 billion loss for the first six months of 2020-21 but says it expects a steep recovery in travel demand once a vaccine is available.
Emirates' airline operations saw revenue slump 75 percent as they accounted for the majority of the group result with a loss of $US3.4 billion.
The rest was made up of a $US396m loss at logistics arm dnata, where revenue fell 67 percent.
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Like most hub airlines, Emirates was hit by plummeting passenger traffic — in this case a 96 percent drop in revenue passenger kilometres — that saw it fill just 38.6 percent of its seats. This was despite a 91 percent fall in capacity.
It did not operate passenger flights between March 25 and May 21 but by September 30 was operating services to 104 cities.
However, the crisis meant it carried just 1.5 million passengers between April 1 and September 30.
“We began our current financial year amid a global lockdown when air passenger traffic was at a literal standstill,’’ said chief executive and chairman Sheikh Ahmed bin Saeed Al Maktoum.
“In this unprecedented situation for the aviation and travel industry, the Emirates Group recorded a half-year loss for the first time in over 30 years.
“As passenger traffic disappeared, Emirates and dnata have been able to rapidly pivot to serve cargo demand and other pockets of opportunity. This has helped us recover our revenues from zero to 26% of our position same time last year.
“The Emirates Group’s resilience in the face of current headwinds is testimony to the strength of our business model, and our years of continued investment in skills, technology and infrastructure which are now paying off in terms of cost and operational efficiency.
“Emirates and dnata have also built strong brands and agile digital capabilities which continue to serve us well, and enabled us to respond adeptly to the accelerated shift of customer and business activities online over the past 6 months.”
Sheik Ahmed said no one could predict the future but Emirates expected a steep recovery in travel demand once a COVID-19 vaccine is available.
He said the company was readying itself to serve that rebound.
“In the meantime, Emirates and dnata remain responsive in deploying resources to serve our customers and meet demand.
“We have been able to tap on our own strong cash reserves, and through our shareholder and the broader financial community, we continue to ensure we have access to sufficient funding to sustain the business and see us through this challenging period.
“In the first half of 2020-21, our shareholder injected $US2 billion into Emirates by way of an equity investment and they will support us on our recovery path.”
The group reported its cash position at September 30 stood at $US5.6 billion.
Actions to cut costs have incldued shedding 24 percent of the group employee base.
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