'We are taking a close look at several options to finance the A340 programme,' Dermott Manion, Emirates Groupdirector for finance, IT and services, told MEED on 5 May. 'Deliveries will take us up to March 2004 so we still have time to consider the right mixture of plain vanilla and Islamic finance, or international lease structures.'

Emirates has successfully diversified its funding sources. Since 1996, the company has secured $4,700 million in financing to support its growth strategy. The company launched in 2001 its first local currency-denominated bond, which closed oversubscribed at AED 1,500 million ($409 million). Priced at 70 basis points over Emirates interbank offered rate (Ebor), the bond was unrated (MEED 13:7:01).

'There is a huge appetite among investors for Emirates paper and eventually we will issue a second bond. We may also seek a rating,' says Manion.

The acquisition of the A340-500s comes in conjunction with the airline's plans to open up new non-stop routes from Dubai to North America and Asia. 'We plan to fly the aircraft direct to New York and the West coast on non-stop 17-hour flights. It is tailor-made for our operating strategy from Dubai,' says Manion. Shrugging off the gloom in the international air transport sector, Emirates' earnings for the financial year ending March 2003 were up 94 per cent to AED 907 million ($247 million - MEED 2:5:03).