Emirates SkyCargo put in a “stellar performance” during the 2020-21 financial year despite the airline group’s first annual loss in over 30 years, caused by a significant drop in revenue due to COVID-19.
The Dubai-based Middle East airline group posted a loss of US$6bn for the financial year ended 31 March 2021 compared with $456m profit in prior year. Group revenue was $9.7bn, a decline of 66%.
With the strong demand in airfreight throughout the year, Emirates’ cargo division reported a revenue of $ 4.7bn, an increase of 53% over prior year.
Global ground handler dnata reported a loss of $ 496m, down from a $168m profit in the previous year.
In its 2020-21 annual report the carrier stated: “Emirates SkyCargo put in a stellar performance by rapidly responding to new demand in a changed global marketplace, contributing to 60% of the airline’s total transport revenue.”
Emirates SkyCargo scaled up operations quickly and rebuilt its cargo network to meet strong demand from shippers who faced a capacity crunch when the pandemic forced airlines to drastically reduce flights.
It supplemented its existing freighter capacity by bringing into service 19 ‘mini freighters’ – modified Boeing 777-300ER passenger aircraft with seats in the economy cabin removed to make room for more cargo. The cargo division also introduced new loading protocols to safely utilise overhead bins and passenger seats to carry cargo.
Added the airline: “In addition to supporting global supply chains for food, medical and other trade items, Emirates SkyCargo also tapped on its pharma capabilities and infrastructure to support the worldwide distribution of COVID-19 vaccines and humanitarian relief to Lebanon in the aftermath of the Port of Beirut explosions.”
In October, Emirates SkyCargo set up a dedicated GDP-certified airside hub in Dubai for COVID-19 vaccines, and later it partnered with UNICEF to facilitate the rapid transport of COVID-19 vaccines to developing nations through Dubai.
Freight yield per Freight Tonne Kilometre (FTKM) increased strongly by 88%, due to the unique pandemic situation which led to significantly reduced cargo capacity in the market worldwide.
Tonnage carried decreased by 22% to reach 1.9m tonnes, due to the reduced available bellyhold capacity for the entire year. At the end of 2020-21, Emirates’ SkyCargo’s total freighter fleet stood unchanged at 11 Boeing 777Fs.
On the group wide results released today in its 2020-21 Annual Report, Sheikh Ahmed bin Saeed Al Maktoum, Chairman and Chief Executive, Emirates Airline and Group, said: “The COVID-19 pandemic continues to take a tremendous toll on human lives, communities, economies, and on the aviation and travel industry.
“In 2020-21, Emirates and dnata were hit hard by the drop in demand for international air travel as countries closed their borders and imposed stringent travel restrictions.
“Our top priorities throughout the year were: the health and wellbeing of our people and customers, preserving cash and controlling costs, and restoring our operations safely and sustainably.
“Emirates received a capital injection of AED 11.3bn (US$ 3.1bn) from our ultimate shareholder, the Government of Dubai, and dnata tapped on various industry support programmes and availed a total relief of nearly AED 800 million in 2020-21.
“These helped us sustain operations and retain the vast majority of our talent pool. Unfortunately, we still had to make the difficult decision to resize our workforce in line with reduced operational requirements.”
For the first time in the group’s history, redundancies were implemented across all parts of the business. As a result, the Group’s total workforce reduced by 31% to 75,145 employees, representing over 160 different nationalities.
Emirates’ total passenger and cargo capacity declined by 58% to 24.8bn ATKMs at the end of 2020-21, due to pandemic related flight and travel restrictions including a complete suspension of commercial passenger services for nearly eight weeks as directed by the UAE government from 25 March 2020.
Emirates received three new A380 aircraft during the financial year and phased out 14 older aircraft comprising of nine Boeing 777-300ERs and five A380s, leaving its total fleet count at 259 at the end of March. Emirates’ average fleet age remains at a ‘youthful’ 7.3 years.
Emirates’ order book for 200 aircraft remains unchanged at this time.
Sheikh Ahmed added: “No one knows when the pandemic will be over, but we know recovery will be patchy. Economies and companies that entered pandemic times in a strong position, will be better placed to bounce back.
“Until 2020-21, Emirates and dnata have had a track record of growth and profitability, based on solid business models, steady investments in capability and infrastructure, a strong drive for innovation, and a deep talent pool led by a stable leadership team.
“These fundamental ingredients of our success remain unchanged. Together with Dubai’s undiminished ambitions to grow economic activity and build a city for the future, I am confident that Emirates and dnata will recover and be stronger than before.”
He concluded: “In the year ahead, we will continue to adopt an agile approach in responding to the dynamic marketplace. We aim to recover to our full operating capacity as quickly as possible to serve our customers, and to continue contributing to the rebuilding of economies and communities impacted by the pandemic.”
