Even though it expects to suffer significant losses in fiscal year 2021, the Abu Dhabi-based airline is looking to the bright side after a difficult year of operational issues. Etihad Airways has released its financial figures for the year 2021, which show a net loss of $476 million dollars.
Nonetheless, despite the negative effect of COVID-19, the airline is concentrating on its accomplishments from the previous year. This is despite the fact that the organization is experiencing one of its most trying times of operation since its foundation in 2003. Let’s take a closer look at the airline’s statement in further detail.
The headline statistics indicate that the economy is on the mend.
Despite the fact that it continues to lose money, Etihad has greatly improved on its 2020 performance. The airline reported losses of $476 million in fiscal year 2021, which, although still putting the airline in the red, is a significant improvement from the $1.70 billion in losses reported in fiscal year 2020.
In addition, the airline reported passenger revenues of US$1.07 billion in 2021, a decline from US$1.24 billion in 2020, a 14 percent decrease. The airline attributes this to the COVID-19 epidemic, which is causing demand to be muted. On the plus side, the airline’s sales recovered during the year’s fourth quarter, recovering to 50 percent of pre-pandemic levels by December 2021, which was a significant improvement.
The number of passengers is progressively increasing again.
In 2021, the airline will carry 3.5 million passengers, a decrease from the previous year’s 4.15 million. This resulted in an average seat load factor of just 39.6 percent for the year, representing a decline of 25 percent over the previous year. Nonetheless, on a more positive note, passenger loads more than doubled in the second half of the year, reaching a high of 70.1 percent in December, as travel demand surged throughout the winter holiday season.
Following the reduction of statutory quarantine periods in Abu Dhabi in September 2021, the airline had a particularly notable increase in passenger numbers in the last quarter of the year.
The overall passenger network capacity of Etihad Airways was estimated to be 37.21 billion ASKs (Available Seat Kilometres) for the calendar year 2017. Abu Dhabi International Airport will be linked to 71 passenger and cargo destinations in 47 countries by the end of 2021, according to the airline.
In addition, it began or relaunched operations to 13 destinations in 2021, the most notable of which was the commencement of scheduled flights between Abu Dhabi (AUH) and Tel Aviv (TLV) after the mending of ties between the UAE and Israel in the wake of the Arab Spring.
Expectations are exceeded by the cargo division’s performance.
Etihad’s substantial cargo operations succeeded well in a market where demand for cargo capacity has skyrocketed, as the company’s cargo fleet demonstrated. The cargo segment of the airline transported 729,200 tones of freight in 2021, reflecting a 27 percent increase over the previous year’s total.
In particular, the growth in freight income attracted a lot of attention. This year’s result, which totaled $1.73 billion, indicates a 49 percent rise over the previous year’s figure. The statistic is notable in that it is the highest ever recorded by the airline in its entire existence.
Mr. Tony Douglas, Group Chief Executive Officer, expressed his thoughts on the airline’s performance in 2021 in the following way:
“While the globe has faced yet another year of uncertainty, Etihad Airways has forged forward, strengthened its operations, and continued to improve its world-class travel product. Once again, this has been made possible by our extraordinary employees, who have gone above and beyond to make the most of every opportunity. Our forecast for the spring and summer seasons is that despite the slowness caused by Omicron, more people will return to the skies and travel will witness a revival.”
Cost management is proven to be a successful strategy.
As the airline’s operations resumed in 2021, Etihad maintained a laser-like emphasis on cost-cutting measures. Despite increases in the price of oil and, therefore, jet fuel, it was able to reduce its total operating expenses by $110 million in the year under review.
In addition, the airline claimed a considerable decrease in its fixed overheads and financial expenses. Compared to the previous year, these declined by $110 million and $90 million correspondingly, or 14 percent and 20 percent, respectively. Thus, in 2021, the airline will be able to retain its good liquidity position.
As a whole, Etihad registered a core operational loss of $476 million for the fiscal year 2021, a 72 percent improvement over the loss of $1.70 billion recorded in 2020 and a 41 percent reduction over the loss of $802 million recorded in the fiscal year prior to the pandemic in 2019.
