Flydubai posts first net profit since launch

13 February 2013

Airline plans to announce new aircraft orders by end of year

Dubai’s low-cost airline Flydubai has posted net profits of AED151.9m ($41.1m) in 2012, becoming profitable after just three years of operation.

Total revenue stood AED2.8bn ($756m), according to the carrier.

Passenger traffic also grew, with Flydubai carrying 5.1 million passengers in 2012, just under 50 per cent of the total passengers carried by the airline till date.

Since its launch three years ago, the airline has carried 10.4 million passengers.

Supported by strong finances and growing passenger demand, the airline is planning to expand further. It is considering a plan to order 50 new aircraft by November, with a potential announcement due to be timed with the opening of the Dubai Airshow, hosted at the emirate’s Al-Maktoum International airport at the Dubai World Central development near Jebel Ali.

Speaking at a press conference, Sheikh Ahmed bin Saeed al-Maktoum, chairman of Flydubai, said the airline is considering aircraft from both the US’ Boeing and France-based Airbus. If the airline opted for an Airbus carrier, it is likely to be an A322.

The airline has a current fleet of 28 aircraft out of a 50-aircraft order it placed with Boeing just before it launched. It is expecting to receive a delivery of six new aircraft in 2013, with the remaining aircraft under the existing order due to be delivered by 2016.

Currently, the airline is operating out of Terminal 2 at Dubai International airport, which is currently being expanded to support the airline’s growth.

Terminal 4 is also being expanded, which will be used by all airlines.  

In the long-term, the airline is expected to move to the Al-Maktoum airport at Dubai World Central. Sheikh Ahmed said that the new passenger terminal at the airport is expected to be inaugurated in October or November, before the Dubai airshow.  

The airline will also be considering launching new routes in 2013, with a particular focus on its growth market in Commonwealth of Independent States (CIS) and Central Europe.

“Over the past three years, we have made air travel more accessible and affordable,” said Sheikh Ahmed. He added that there are plenty of “untapped opportunities” for the airline in the coming years.

In terms of financing its operations, the airline will continue to rely on its own revenues as well as commercial bank financing. Sheikh Al Maktoum said that Flydubai would not consider launching IP0 in the near future.

To date the airline has raised AED4.5bn ($1.2bn) financing to fund acquisition of its aircraft fleet to-date. It has also used export credit agency-backed financing to secure aircraft, securing a $117.5m loan backed by a guarantee from the Export-Import Bank of the United States in October last year.

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