Group announces half-year performance for 2016-17 Group: Revenue up 1% to AED 46.5 billion (US$ 12.7 billion), and profit of AED 1.3 billion (US$ 364 million), down 64%, reflects the double impact of a strong US dollar and challenging operating environment. Emirates: Revenue down 1% to AED 41.9 billion (US$ 11.4 billion). 28 million passengers carried, up 9%, on overall capacity expansion of 9%. dnata: Revenue up 14% to AED 6.0 billion (US$ 1.6 billion). Strong growth in aircraft, cargo and catering volumes handled, reflecting consolidation of major international acquisitions of past year. DUBAI, U.A.E., 9th November 2016: The Emirates Group today announced its half-year results for 2016-17. The Group held steady on revenue, but profit was hit by the double impact of a strong US dollar and challenging operating environment for the airline and travel business. The Emirates Group revenue was AED 46.5 billion (US$ 12.7 billion) for the first six months of its 2016-17 financial year, up 1% from AED 46.0 billion (US$ 12.5 billion) during the same period last year. Following one of its best ever half-year profit performances last year, the Group for 2016-17 reported a half-year net profit of AED 1.3 billion (US$ 364 million), down 64%. The Group s cash position on 30th September 2016 was at AED 14.9 billion (US$ 4.1 billion), compared to AED 23.5 billion (US$ 6.4 billion) as at 31 st March 2016. This is due to ongoing investments mainly into new aircraft, airline related infrastructure projects, business acquisitions, and the repayments of bonds totalling AED 4.1 billion (US$ 1.1 billion), loans and lease liabilities. Our performance for the first half of the 2016-17 financial year continues to be impacted by the strong US dollar against other major currencies. Increased competition, as well as the sustained economic and political uncertainty in many parts of the world has added downward pressure on prices as well as dampened travel demand, said His Highness (HH) Sheikh Ahmed bin Saeed Al Maktoum, Chairman and Chief Executive, Emirates Airline and Group. He added: The bleak global economic outlook appears to be the new norm, with no immediate resolution in sight. Against this backdrop, the Group has remained profitable and our solid business foundations continue to stand us in good stead. In the first six months of this year, both Emirates and dnata continued to grow in capability and capacity. Our past investments in product and services are now paying off, enabling us to retain valued clients and attract new customers - reflected in the airline s passenger growth of 2.3 million. We continue to make strategic investments, because we know we have to work even harder for every customer, and make every dollar spent go even further through innovation and driving efficiency across our business. In the past six months, the Group continued to develop and expand its employee base, increasing its overall staff count to over 103,000, a 9% increase compared with 31 March 2016. This was mainly due to recent acquisitions in dnata businesses, and also required support for Emirates growing fleet. Emirates airline Emirates continues to invest in the most advanced wide-body aircraft to improve overall efficiency and provide better customer experience. During the first six months of the financial year, Emirates received 16 wide-body aircraft 8 Airbus A380s, and 8 Boeing 777s, with 20 more new aircraft scheduled to be delivered before the end of the financial year. It also retired 19 older aircraft from its fleet with further 8 to be returned by 31 March 2017.
expanded its global route network by launching passenger services to four new destinations Yinchuan, Zhengzhou, Yangon, and Hanoi. As of 30 September, Emirates global network spanned 155 destinations in 82 countries, with Fort Lauderdale to come online on 15 December 2016. Operating the world s largest fleet of A380s and the largest fleet of Boeing 777s, Emirates continues to provide ever better connections for its customers across the globe with just one stop in Dubai. Overall capacity during the first six months of the year increased 9% to 30.2 billion Available Tonne Kilometres (ATKM). Capacity measured in Available Seat Kilometres (ASKM), grew by 12%, whilst passenger traffic carried measured in Revenue Passenger Kilometres (RPKM) was up 8% with average Passenger Seat Factor dropping to 75.3%, compared with last year s 78.3%. Emirates carried 28.0 million passengers between 1 April and 30 September 2016, up 9% from the same period last year. The volume of cargo uplifted remained stable at 1.3 million tonnes, a solid performance in a challenging air freight market. In the first half of the 2016-17 financial year, Emirates net profit is AED 786 million (US$ 214 million), down 75%, following one of the airline s best half-year performances during the same period last year. Emirates revenue, including other operating income, of AED 41.9 billion (US$ 11.4 billion) was slightly down by 1% compared with AED 42.3 billion (US$ 11.5 billion) recorded last year. This is due to the unfavourable currency environment - where the US dollar continued to strengthen against most other major currencies; and increased competition resulting in lower average fares. The airline was also impacted by currency devaluation and hard currency shortage in some African countries, as well as dampened travel demand due to the ongoing economic malaise and looming security concerns across major markets in its network. Emirates operating costs grew by 5% against the overall capacity increase of 9%. On average, fuel costs were 10% lower compared to the same period last year. However, fuel remained the largest component of the airline s cost, accounting for 24% of operating costs compared with 28% in the first six months of last year. dnata dnata continued to strengthen its global businesses which now span 83 countries. In the first half of 2016-17, dnata s international operations accounted for over 67% of its total revenue. dnata s revenue, including other operating income, is AED 6.0 billion (US$ 1.6 billion), a robust 14% increase compared to AED 5.2 billion (US$ 1.4 billion) last year. This solid performance was underpinned by the consolidation of dnata s recent acquisitions in its ground handling businesses in Europe and Americas. Overall profit for dnata was down slightly by 1% to AED 549 million (US$ 150 million), mainly due to the impact of the strong US dollar on currency repatriation from its international businesses, and also due to start-up investment costs in some of its new acquisitions. dnata s airport operations remained the largest contributor to revenue with AED 3.1 billion (US$ 843 million), a 31% increase compared to the same period last year. Across its operations, the number of aircraft handled by dnata increased significantly by 75% to 297,721, and it handled 1.2 million tonnes of cargo, up 28%, reflecting the new businesses acquired, as well as an increase in traffic at Dubai International airport over the same period last year.
dnata's travel division contributed AED 1.5 billion (US$ 404 million) to revenue, down 13% from the same period last year. The division s underlying net sales decreased by 14% to AED 5.3 billion (US$ 1.4 billion), illustrating the impact of economic uncertainty and increased price competition in the travel and tourism industry. dnata s flight catering operation, contributed AED 1 billion (US$ 286 million) to its total revenue, up 3%. The number of meals uplifted was at 34.2 million meals for the first half of the financial year, up 5% compared to last year s figure of 32.7 million. -ends
INTERIM CONSOLIDATED INCOME STATEMENT FOR THE SIX MONTHS ENDED 30 SEPTEMBER 2016 Sep 2015 Revenue 7 41,179 41,876 Other operating income 8 697 442 Operating costs 9 (40,514) (38,568) Operating profit 1,362 3,750 Finance income 10 145 95 Finance costs 10 (674) (691) Share of results of investments accounted for using the equity method 61 66 Profit before income tax 894 3,220 Income tax expense (21) (21) Profit for the period 873 3,199 Profit attributable to non-controlling interests 87 82 Profit attributable to Emirates' Owner 786 3,117 INTERIM CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME FOR THE SIX MONTHS ENDED 30 SEPTEMBER 2016 Profit for the period 873 3,199 Items that are or may be reclassified subsequently to the interim consolidated income statement ` Currency translation differences 14 3 (18) Cash flow hedges 14 677 (257) Other comprehensive income 680 (275) Total comprehensive income for the period 1,553 2,924 Total comprehensive income attributable to non-controlling interests 87 82 Total comprehensive income attributable to Emirates' Owner 1,466 2,842 s 1 to 22 form an integral part of these interim condensed consolidated financial statements. 1
INTERIM CONSOLIDATED STATEMENT OF FINANCIAL POSITION AS AT 30 SEPTEMBER 2016 AED m Audited Mar 2016 AED m ASSETS Non-current assets Property, plant and equipment 12 83,302 82,836 Intangible assets 1,431 1,317 Investments accounted for using the equity method 665 522 Advance lease rentals 3,740 2,580 Loans and other receivables 406 494 Deferred income tax asset 3 3 89,547 87,752 Current assets Inventories 2,202 2,106 Trade and other receivables 9,604 9,321 Derivative financial instruments 10 12 Short term bank deposits 6,281 7,823 Cash and cash equivalents 5,619 12,165 23,716 31,427 Total assets 113,263 119,179 Audited Mar 2016 EQUITY AND LIABILITIES Capital and reserves Capital 13 801 801 Other reserves 14 (499) (1,179) Retained earnings 33,073 32,287 Attributable to Emirates' Owner 33,375 31,909 Non-controlling interests 518 496 Total equity 33,893 32,405 Non-current liabilities Trade and other payables 546 513 Borrowings and lease liabilities 15 40,279 40,845 Deferred revenue 1,755 1,596 Deferred credits 1,888 1,090 Derivative financial instruments 371 440 Provisions 19 3,907 3,762 Deferred income tax liability 4 4 48,750 48,250 Current liabilities Trade and other payables 23,153 26,532 Income tax liabilities 28 35 Borrowings and lease liabilities 15 5,410 9,260 Deferred revenue 934 1,316 Deferred credits 218 139 Derivative financial instruments 151 737 Provisions 726 505 30,620 38,524 Total liabilities 79,370 86,774 Total equity and liabilities 113,263 119,179 The interim condensed consolidated financial statements were approved and signed by: s 1 to 22 form an integral part of these interim condensed consolidated financial statements. 2
INTERIM CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE SIX MONTHS ENDED 30 SEPTEMBER 2016 (UNAUDITED) Attributable to Emirates' Owner Capital Other reserves Retained earnings Total Noncontrolling interests Total equity 1 April 2015 801 (168) 27,253 27,886 400 28,286 Profit for the period - - 3,117 3,117 82 3,199 Other comprehensive income - (275) - (275) - (275) Total comprehensive income for the period - (275) 3,117 2,842 82 2,924 Dividends - - - - (78) (78) Transactions with Owners - - - - (78) (78) 30 September 2015 801 (443) 30,370 30,728 404 31,132 1 April 2016 801 (1,179) 32,287 31,909 496 32,405 Profit for the period - - 786 786 87 873 Other comprehensive income - 680-680 - 680 Total comprehensive income for the period - 680 786 1,466 87 1,553 Dividends - - - - (65) (65) Transactions with Owners - - - - (65) (65) 30 September 2016 801 (499) 33,073 33,375 518 33,893 s 1 to 22 form an integral part of these interim condensed consolidated financial statements. 3
INTERIM CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE SIX MONTHS ENDED 30 SEPTEMBER 2016 Sep 2015 Operating activities Profit before income tax 894 3,220 Adjustments for: Depreciation and amortisation 9 4,064 3,924 Finance costs - net 10 529 596 Loss on disposal / write-off of property, plant and equipment 29 34 Share of results of investments accounted for using the equity method (61) (66) Net provision for impairment of trade and other receivables (1) 22 Provision for employee benefits 370 379 Net movement on derivative financial instruments 24 (4) Employee benefit payments (295) (304) Income tax paid (36) (39) Change in inventories (96) (98) Change in receivables and advance lease rentals (1,279) (214) Change in provisions, payables, deferred credits and revenue (392) (2,509) Net cash generated from operating activities 3,750 4,941 Sep 2015 Investing activities Proceeds from sale of property, plant and equipment 24 720 Additions to intangible assets (176) (147) Additions to property, plant and equipment 21 (3,604) (4,638) Investments in associates and joint ventures (129) (15) Movement in short term bank deposits 1,542 3,766 Finance income 141 141 Dividends from investments accounted for using the equity method 47 63 Net cash used in investing activities (2,155) (110) Financing activities Proceeds from loans 1,908 - Repayment of bonds and loans (5,116) (1,231) Aircraft finance lease costs (481) (452) Other finance costs (163) (152) Repayment of lease liabilities (2,127) (2,035) Dividend paid to Emirates' Owner (2,100) (2,100) Dividend paid to non-controlling interests (65) (78) Net cash used in financing activities (8,144) (6,048) s 1 to 22 form an integral part of these interim condensed consolidated financial statements. Net change in cash and cash equivalents (6,549) (1,217) Cash and cash equivalents at beginning of the period 12,165 8,393 Effects of exchange rate changes - (3) Cash and cash equivalents at end of the period 5,616 7,173 4