Abu Dhabi Aviation rebounds from last year's loss of a key local helicopter contract as it reported a 20.8 per cent jump in its annual earnings on higher-margin foreign leases of aircraft.
Abu Dhabi Aviation lifts earnings
Abu Dhabi Aviation rebounded strongly from last year's loss of a key local helicopter contract as it reported a 20.8 per cent jump in its annual earnings on higher-margin foreign leases of aircraft. The company, which is the largest helicopter operator in the Middle East and holds stakes in other aviation firms, underwent a restructuring programme, including making redundant 140 staff - or 15 per cent of its workforce - last year after Abu Dhabi Marine Operating Company took a large part of its offshore oil helicopter service contract to a rival operator.
Abu Dhabi Aviation then leased out the freed up helicopters to foreign oil companies abroad, helping the company to a net profit of Dh140.5 million (US$38.2m), as its revenue jumped 33 per cent from the year earlier to Dh1.44 billion. "It didn't sound like a blessing in disguise when it happened," said Nadir al Hammadi, the managing director. But he said the foreign leases had higher margins, helping the bottom line.
"We had to find some opportunities in India and Brazil and managed to put the helicopters in the hands of oil companies," he said. The company has also been seeking opportunities with offshore oil companies in Australia, Oman and Yemen, he said. Abu Dhabi Aviation's preliminary annual results included the contributions of Royal Jet, the business jet operator of which it owns a 50 per cent stake, and Maximus Air Cargo, its 95 per cent owned Abu Dhabi-based freight operator.
The lion's share of the profit, or Dh101m, came from the company's helicopter services business, Mr al Hammadi said, as its subsidiaries were slowed by the decline in demand from the global downturn. "There was a lot of pressure when it came to the charter side of the business, and to cargo," he said. "The market has significantly been reduced, but we are seeing signs that things are slowly recovering."
The company operates some 60 helicopters used on offshore support contracts and VIP charter. It also operates a fleet of small passenger jets for its scheduled services from Abu Dhabi airport to Dalma Island in the Al Gharbia region. The company has also leased helicopters to other air operators, and to oil and gas firms in Ethiopia, Pakistan and Afghanistan. For the past 11 years, it has sent helicopters to Spain under summer firefighting contracts.