x Abu Dhabi, UAEMonday 24 July 2017

Lift-off for Air Arabia as net profits double

What's Up: Shares in Air Arabia soared to a seven-month high on the Dubai Financial Market after the low-cost carrier posted positive third-quarter results.

Air Arabia's share price hit Dh0.718 in early trading yesterday. Jeff Topping / The National
Air Arabia's share price hit Dh0.718 in early trading yesterday. Jeff Topping / The National

Shares in Air Arabia soared to a seven-month high yesterday on the Dubai Financial Market after the low-cost carrier doubled net profits in the third quarter.

The share price hit Dh0.718 in early trading yesterday, up more than 2 per cent, as investors were cheered by the airline's positive results and outlook.

It reported a net profit of Dh226 million for the three months to the end of September, an increase of 126 per cent on Dh100m in the same period last year.

Revenues also took off, increasing 19 per cent to Dh836m compared with the same three months last year.

Air Arabia's shares have increased 26 per cent since a trough in June of Dh0.56, as the airline has embarked on a major expansion of routes around the Middle East, Europe and Africa.

In the past quarter, it added three new destinations - Erbil in Iraq, Uffa in Russia and Odessa in Ukraine.

Moreover, Air Arabia has expanded operations from its two other major hubs outside Sharjah - Morocco and Egypt - and announced the launch of four additional routes last month.

It now flies to 81 destinations across the Middle East, Africa, Europe and Asia.

"The sustained profitability and solid growth margins signal that Air Arabia is on a steady growth trajectory," said Sheikh Abdullah bin Mohammad Al Thani, the chairman of Air Arabia, as he announced the results.

"We will continue to enter into new markets and launch new ventures, while providing our customers with an even wider choice of value-for-money travel options."

Air Arabia flew 14 per cent more passengers in the third quarter than the previous year - a total of 1.3 million travellers.

Seat load factor, a key industry measurement of the average occupancy on a plane, was also high at 82 per cent.

For the first nine months of the year, the airline's profit was Dh342m, up 75 per cent on Dh195m a year earlier.

rjones@thenational.ae