Travel Industry News at TravelNewsAsia.com since 1997. Interviews, podcasts, videos, pictures and more
Fri, 7 August 2020

Etihad Airways Reports Strong Start to Year with Q2 Heavily Impacted by COVID19

Etihad Airways' H1 2020 performance included the best monthly results to date for February, prior to the impact of COVID19, the subsequent closure of international borders, and the suspension of flights to and from the UAE from 24 March.

Etihad carried 3.5 million passengers in H1, a reduction of 58% from the same period the previous year (H1 2019: 8.2 million). Average seat load factor was 71%.

Core operating loss for this period increased by US$ 172 million to US$ 758 million (H1 2019: US$ 586 million), driven by a 38% drop in revenues, which stood at US$ 1.7 billion (H1 2019: US$ 2.7bn). This was partially off-set by a 27% reduction in direct operating costs to US$ 1.9 billion (H1 2019: US$ 2.7 billion), and a 21% reduction in general and administrative expenses to US$ 0.40 billion (H1 2019: US$ 0.50), both driven by management cost containment initiatives and reduced operations. Available Seat Kilometres (ASK) reduced by 53% to 23.69 billion (H1 2019: 50.35 billion).

Cargo revenues were US$ 0.49 billion, an improvement of US$ 130 million (37%) compared to the same period in 2019, with 254,345 leg tonnes of cargo carried. This was driven by an increase in demand and a spike in cargo fares.

Etihad Airways Boeing 787-9 reg: A6-BLX. Picture by Steven Howard of TravelNewsAsia.com Click to enlarge.

The core operating result for the first three months of the year improved by 34%, despite the onset of COVID19, with a 12% reduction in passenger numbers, and a 9.5% reduction in ASK. Q1 seat load factor was 74% (Januarys performance was significantly stronger than the same month in 2019, with a seat load factor of 81.9%), and yield at US$ 5.92 cents. Unit revenue in Q1 reduced by 3.3% to US$ 4.14 cents (Q1 2019: US$ 4.28 cents), offset by continuous focus on driving down unit costs, which were reduced by 2.4% to US$ 7.01 cents (Q1 US$ 7.18 cents).

However, the airline saw a significant decrease in Q2 operating revenues following COVID19 flight suspensions, with 70% of its fleet grounded. This period registered a 99% drop in passenger numbers and a 95% drop in ASK compared to Q2 2019. Seat load factor for this period was 16%, mainly driven by the operation of special (repatriation) flights, and the resumption of a limited network of transfer services via Abu Dhabi in early June.

Tony Douglas, Group Chief Executive Officer, Etihad Aviation Group, said, Etihad faced a set of enormous and unpredictable challenges in the first six months of the year. We started 2020 strong, and recorded encouraging results as part of our continuing transformation programme. This left us in a relatively robust position when COVID19 hit, allowing us to act with agility, and to mobilise all available resources as the crisis deepened, taking major steps to reduce costs through a wide-reaching series of measures.

While we have revised our outlook for the rest of 2020 based on current realities, we remain optimistic that as international borders re-open, we will increase our flying and carry more guests securely and with greater peace of mind, supported by the Etihad Wellness programme and our new Wellness Ambassadors. By September, we aim to increase our worldwide flights to half our pre-COVID19 capacity. Looking forward, we rest assured that the UAE is leading the way in the research for a vaccine against COVID19. The incredible efforts Abu Dhabi is making to ensure the safety and security of its residents and visitors will soon enable us to welcome the world back to our amazing home. This commitment was successfully highlighted by the recent hosting of major UFC events in the capital.

Etihad operated up to 40 of its fleet of 97 passenger aircraft in Q2, including Boeing 787 Dreamliners, 777-300ERs, and Airbus A320 family aircraft as belly-hold cargo freighters to complement Etihad Cargos operational fleet of six 777-200F freighters. Between 25 March and 15 June, over 640 special passenger flights were operated to 45 online and offline destinations, using the passenger cabins of these aircraft to fly foreign nationals out of the UAE, and to bring UAE nationals back home.

Adam Boukadida, Chief Financial Officer, Etihad Aviation Group, said, This year started strong, riding on the positive momentum gained in 2019, and by the end of the first quarter, the airline was on track to achieve a 2020 EBITDA of US$ 900 million (2019: US$ 453 million). Etihad managed to maintain a satisfactory level of liquidity despite a major drop in revenues, while continuing to raise new liquidity facilities supported by local and international financial institutions.  This was supported by maintaining an A with a stable outlook Fitch rating in April, at the height of the pandemic. Etihad was one of a small number of airlines to maintain its pre-COVID19 credit rating.

A greater emphasis is being placed on a drive towards increased cost optimisation and efficiencies across the entire business to face the hurdles placed in our way by COVID19. Our suppliers and partners have also worked closely with us, including the arrangement of payment holidays with lessors and savings discussions with all of our supply chain, so we can re-emerge stronger together.

Etihad is gradually resuming services to more destinations across its global network. This follows the easing of travel restrictions by UAE regulatory authorities on outbound and inbound travel for citizens and residents. All travel remains subject to the entry and health regulations set by the UAE authorities, and those at the end destination.

Throughout August and September, subject to the lifting of international restrictions and the re-opening of individual markets, the airline aims to fly to 61 destinations worldwide from its Abu Dhabi hub, operating approximately 50% of its pre-COVID19 capacity.

Subject to the applicable government approvals, Etihads summer schedule will feature a wider network and increased frequencies to the following destinations from, to, or via Abu Dhabi:

Middle East & Africa: Amman, Bahrain, Beirut, Cairo, Casablanca, Dammam, Jeddah, Kuwait, Muscat, Rabat, Riyadh, Seychelles Europe: Amsterdam, Athens, Barcelona, Belgrade, Brussels, Dublin, Dusseldorf, Frankfurt, Geneva, Istanbul, London Heathrow, Madrid, Manchester, Milan, Moscow, Munich, Paris Charles de Gaulle, Rome, Zurich Asia: Ahmedabad, Baku, Bangkok, Bengaluru, Chennai, Colombo, Delhi, Hyderabad, Islamabad, Jakarta, Karachi, Kochi, Kolkata, Kozhikode, Kuala Lumpur, Lahore, Male, Manila, Mumbai, Seoul, Shanghai, Singapore, Thiruvananthapuram, Tokyo Australasia: Melbourne, Sydney North America: Chicago, New York JFK, Toronto, Washington, D.C.

To protect its customers, Etihad launched Etihad Wellness, a comprehensive health and hygiene programme, building on the stringent measures already put in place to deal with COVID19, and which is now a major component of the airlines long-term customer strategy.

The launch of the programme was championed by the introduction of specially trained Wellness Ambassadors who provide essential travel health information and care online via webchat, at Abu Dhabi International Airport, and in-flight, so guests can fly with greater peace of mind.

The global response to many aspects of the programme, including the game-changing Wellness Ambassadors and wide-ranging travel health and hygiene protocols, has been overwhelmingly positive. The airline is taking the opportunity to develop Etihad Wellness as a key differentiator for customers when purchasing a premium product which can guarantee them genuine care and effective health and safety measures, and deliver a world-leading service and hospitality offering.

Etihad Wellness initiatives are being communicated through an easy-to-use online guide focusing on the high standards of cleanliness, and health and hygiene being applied at every stage of the customer journey. This includes culinary hygiene at the airlines catering facilities and food testing laboratory, aircraft cabin deep-cleaning, check-in, health screening, boarding, inflight experience and product, crew interaction, arrival, and ground transportation.

In June, Etihad also launched a partnership with Austria-based healthcare technology company, Medicus AI, to launch a COVID19 risk-assessment tool that will empower guests to make informed decisions about travelling.

Workforce

Due to the severity of the situation facing the industry, the airline has been forced to redesign the organisation around the need to make redundancies from its workforce across several areas of the business to ensure future continuity. Temporary company-wide salary sacrifices of 25% to 50% were also introduced.

 Etihad, like all major airlines, has had no choice but to embrace the ambiguity of the situation it has been thrown into, and with much sadness, we have had to make some extremely difficult decisions to reduce the size of the workforce by several thousand. Those who have departed Etihad have done so with incredible dignity and their contribution has been immeasurable, said Mr. Douglas. We are tremendously proud of each member of the Etihad family, every one of whom has gone above and beyond in extremely difficult conditions to keep Etihads image held high, while maintaining superior levels of service. Etihad flew into the COVID19 era with uncertainty but is re-emerging resilient, if a little battle-scarred, with a renewed focus on its core values. We are retraining our people throughout the organisation to deliver a new product for a new reality, based on the development and delivery of Etihad Wellness well into the foreseeable future.

Humanitarian Flights

Etihad and Etihad Cargo operated special humanitarian services to 60 cities around the world, 40 of which are not currently served by the airlines passenger or cargo network of flights. These included Addis Ababa, Antananarivo, Auckland, Bamako, Banjul, Barbados, Bhubaneswar, Bishkek, Bogota, Bucharest, Buenos Aires, Conakry, Dushanbe, Erbil, Freetown, Grozny, Harare, Havana, Kabul, Kiev, Kinshasa, Kish Island, Larnaca, Lima, Lucknow, Makhachkala, Moroni, NDjamena, Niamey, Nouakchott, Podgorica, San Jose, Santiago, Santo Domingo, Sofia, Tirana, Wuhan, Yerevan, and Zagreb.

Maintenance

With most of its passenger aircraft on the ground throughout April, May and June, Etihad embarked on the biggest aircraft maintenance programme in its history.

The airlines MRO division, Etihad Engineering, performed maintenance work on 97 passenger aircraft including 29 Airbus A320 and A321s, 10 Airbus A380s, 39 Boeing 787s, and 19 Boeing 777-300ERs.

Work ranged from minor maintenance tasks, such as seat repairs and updates to inflight entertainment systems, to bringing forward scheduled engine changes and modifications on several aircraft, reducing the need to withdraw them from service when scheduled services resumed. The extensive programme was additional to the routine maintenance which is carried out at regular intervals.

Sustainability

 In January, in the presence of the EU Commission Etihad announced a commitment of zero net carbon Emissions by 2050 and halving of 2019 emissions by 2035.

Following the launch of the Greenliner programme in partnership with Boeing in November 2019, Etihad in January took delivery of a specially branded Boeing 787-10 aircraft, wearing a special green livery to highlight its role in sustainability research activities, to drive innovation and sustainability into the operational space.

To celebrate Irelands National Day, Etihad deployed the Greenliner from Abu Dhabi to Dublin. An optimised route profile reduced the journey time by 40 minutes, cut fuel by 800kgs, and CO2 by three tonnes.

In the same month, when Etihad announced its sustainability commitments in Brussels, the airline operated a Boeing 787 EcoFlight from Abu Dhabi to the home of the EU. The flight had an optimised routing by Eurocontrol; minimum single use plastics; and other fuel efficiency initiatives including the use of electric tractors at the Abu Dhabi hub, reducing APU usage, and optimising potable water levels.

The clear focus moving forward is on adapting our transformation plan to reflect new market conditions, but without changing our overall objectives or sustainability goals and commitments. We anticipate some continued volatility for a while to come, as the world strives to put an end to COVID19, and as testing methodologies and protocols evolve to become the new norm.

We know that markets are certain to rebound and the world will rediscover the wonder of flying once more. When it does, our guests will value the Etihad Wellness proposition more than ever, and we are best positioned to deliver the security, assurance, and best-in-class experience they have come to expect from Etihad as a true full-service airline, concluded Mr. Douglas.

See also: Airports, Air Travel and COVID19 - Exclusive Interview with SITA's President of Asia Pacific, Sumesh Patel.

See latest Travel News, Video Interviews, Podcasts and other news regarding: COVID19, Etihad, Abu Dhabi.

Headlines: Qantas Updates Flying Schedule; Plans to Reroute Perth - London Flights  Qatar Airways Extends Commitment to Combatting Illegal Wildlife Trade  EmbraerX and Pyka to Accelerate Growth of Autonomous Agriculture  United Airlines Makes it Easier to Use Credits  Cyril Kongo Designs Special Cabin for Airbus Corporate Jets  AATA and MAB to Collaborate on Pilot Training in Malaysia  India Formalises Acquisition of 56 Airbus C295 Aircraft  Bombardier Expands Partnership with GETI to Include Dallas Service Centre  Marriott Sets Net Zero 2050 Goal  Qatar Airways to Launch Flights to Almaty, Kazakhstan  CWT Appoints Joel Hanson as SD Global Innovation Business Development  Emirates SkyCargo Upgrades Booking Process with CargoWise  Airbus to Manufacture Three Full-Size Prototype Aircraft Wings  Four Seasons Anguilla Appoints Nicole Lingos Spillane as DOSM  Finnair and Turkish Airlines to Codeshare  Eve Urban Air Mobility Signs MOU with Bristow Group  Boeing Forecasts China's Airlines to Require 8,700 New Planes by 2040  LATAM Airlines to Save Fuel with Airbus' Descent Profile Optimisation Software  World Air Transport Summit and IATA AGM to Take Place in Boston 3-5 October  Bangkok Airways to Resume BKK - TDX Flights on 1 October  Sabre Travel Solutions Appoints Nicole Regel as Senior Director - AU, NZ, SP  Airbus to Deliver US-Completed Commercial Aircraft with SAF  Claude Sauter Appointed GM of The Slate Resort in Phuket, Thailand  Solomon Islands Tourism Industry in Mourning as Jo Tuamoto Passes Away  Cobham Signs New Pool Program Agreement with Embraer  The Langham, Jakarta - Exclusive Video Interview with Gaylord Lamy, GM  Pan Pacific to Open 13 More Properties by End-June 2024  First Flight of CityAirbus NextGen Scheduled for 2023  British Airways Extends Tier Status of Executive Club Members  Emirates to Increase Flights to USA  Marriott Signs W Hotel in Florence, Italy  Airbus Testing Engine Back-Up System for Helicopters  Boeing to Open Final Assembly Facility in Australia  Cathay Pacific Reports Increase in Passenger and Cargo Numbers  Eve Partners Helipass to Promote eVTOL Flights in France  Guillaume Daudin Joins ATR as Senior Vice President - Programmes  Wharf Hotels Opens Regional Sales Office in Guangzhou, China  Richard Poskanzer Appointed GM of Four Seasons Hotel Nashville  Cathay Pacific Pledges to Use SAF for 10% of Fuel Consumption by 2030  WHO Appoints Gordon Brown as Ambassador for Global Health Financing  Centel Appoints Gun Srisompong as CFO  QantasLink Launches Flights Between Brisbane and Proserpine  Alliance Airlines Signs Multi-Year Services Agreement with Embraer  Qatar Airways Joins ICAO's Global Coalition for Sustainable Aviation  United Airlines to Launch Flights Between Washington, D.C. and Lagos, Nigeria  Outrigger Hospitality Appoints Avery Aoki as CFO  Cricket Hong Kong Appoints Geoffrey Ma as Honorary President  Braathens, ATR and Neste to Accelerate 100% SAF Certification  Boeing to Build MQ-25 Stingray Factory in Illinois, USA  Rolls-Royce's All-Electric Spirit of Innovation Aircraft Takes Off for First Time  Rosewood Signs Residential Project in Lido Key, Florida  Etihad Airways Signs New Multi-Solution Technology Agreement with Sabre  Emirates to Recruit 3,500 Cabin Crew and Airport Services Employees  Susan Wheatley Returns to UK as DOSM of The Peninsula London  Air New Zealand and Airbus to Research Hydrogen-Powered Aircraft in Aotearoa  Nihat Yucel Joins Four Seasons Hotel Alexandria at San Stefano as GM  Phoenix Police Department Orders Five Airbus H125 Helicopters  Six Senses to Take Over Management of Luxury Resort in Maldives  CWT to Recapitalize Business  Lufthansa Group Signs Extensive New Distribution Agreement with Travelport  Pan Pacific Opens First Hotel in UK as UOL Completes One Bishopsgate Plaza  British Airways to Launch Flights to Azorean Islands of Sao Miguel and Terceira  Changi Renews ACI's Airport Health Accreditation  GlobalData Reports Decline in Travel and Tourism Sector Deals in August  Hotel Group in Cambodia Makes COVID19 Test Mandatory for Every Guest  Hyatt Signs Luxury Hotel in Changsha, China  Marriott Adds Domes of Corfu in Greece to Autograph Collection  Emirates Expands Virtual Reality Experiences to the Oculus Store  Swedish Project to Establish Technical Roadmap Towards Fossil-Free Aviation  Etihad Airways Signs Multi-Solution Technology Agreement with Amadeus  Bombardier Unveils New Version of Challenger 350  MQ-25 T1 Refuels U.S. Navy F-35C Lightning II Fighter Jet for First Time  Mandarin Oriental Signs Property on Wilshire Boulevard, Beverly Hills  Breeze Airways Increases A220-300 Order to 80; Unveils Livery  IATA Appoints Philip Goh as Regional Vice President - Asia Pacific  Plaza Premium Signs First Airport Lounge in Japan  Industry Must Prioritize Collaboration and Experimentation to Advance NDC Adoption  Association of Asia Pacific Airlines Sets Goal of Net Zero Emissions by 2050  Elbit Systems to Strengthen Naval Defence of Asia Pacific Country  Langham Opens Luxury Hotel in Jakarta, Indonesia  QantasLink Launches Direct Flights Between Adelaide and Townsville  Hong Kong Int. Airport Handled 222,000 Passengers in August  Rosewood Signs Luxury Hotel in San Francisco, USA  Michael Grande Joins Four Seasons Hotel Seattle as Executive Chef  Etihad Airways Upgrades Verified to Fly Service  Cascade Affiliate to Buy Controlling Stake in Four Seasons Hotels and Resorts  TSA Doubles Fines on Travellers Who Refuse to Mask  Emirates to Expand Use of Biometrics and Self-Service Kiosks  Jumeirah to Open Luxury Resort in Maldives on 1 October  United Airlines and Honeywell Invest in Alder's Sustainable Aviation Fuel (SAF)  Emirates to Resume Flights to Saudi Arabia  CWT Retains EcoVadis Platinum Status for Responsible Business Practices  SITA Achieves CarbonNeutral Company Certification  Sabre to Support Biman's Digital Transformation  Ascott Buys More Student Accommodation in USA  Real-World Data Shows Extremely Low Infection Rate on COVID19-Tested Flights  Air Astana Increases Flights to Kyiv and Istanbul  VistaJet's Cabin Hostess Training Now Includes First Aid for Pets  British Airways Launches BA Better World Sustainability Programme  Dassault Aviation in Moscow for RUBAE 2021  Airbus and Alstom to Improve Rail Transport Cybersecurity  IHG Takes Over Management of Hotel in Little India, Singapore  Plaza Premium to Transform Passenger Experience at BLR Airport in India  Thai AirAsia Flights to Chiang Mai, Chiang Rai and Hat Yai Prove Most Popular  SITA to Integrate Iridium Certus Satellit into UAC Portfolio  CWT Integrates Amadeus' Selling Platform Connect into European Service Hubs  Debbie Kristiansen Returns to Bahrain as GM of New Exhibition & Convention Centre  Air Canada Rouge Resumes Flights  US Army Takes Delivery of First Airbus UH-72B Lakota Helicopter  Marriott Opens 8th W Hotel in China  Lufthansa First Airline in Europe to Fly Airbus' New Single-Aisle Airspace Cabin  Banwa Private Island in Philippines Partners Ascent for Luxury Transfers by Air  Steve Carroll and David Ling Join CBRE Hotels & Hospitality - Asia Pacific  Korean Air to Buy Carbon-Neutral Jet Fuel from SK Energy  Deutsche Hospitality Expands Steigenberger Brand to Doha, Qatar  Turkish Aerospace Awarded Two Boeing-Related Contracts by Spirit AeroSystems  Travelport Launches Global Accelerator Program in Collaboration with AWS  Eve and Microflite to Develop Urban Air Mobility Services in Australia  Priority Pass Reports Increase in Airport Lounge Visits  QantasLink Starts Upgrading Inflight Entertainment  Saab to Upgrade Belgium's Air Traffic Control with Digital Towers  Emirates to Take Delivery of Last Brand New A380 in November  Success for Phuket Raceweek 2021  SAS Appoints Head of Media Relations in Denmark  Air Mauritius Appoints APG as GSA in Germany, Italy and Switzerland  Asia-Pacific Airlines' July Int. Traffic Down 94.2% on July 2019  FCM Partners NSF Engagement for JV in Japan  British Airways Reopens Concorde Room at JFK and London Heathrow  Griffin Orders 5 Boeing 737-8 Aircraft  CWT Meetings & Events Appoints Ian Cummings as Global Head  Behind the Scenes of Emirates Airline's Latest Ad - We're on Top of the World  Kazakhstan Orders Two Airbus A400M Aircraft  Executive Appointments at Elbit Systems  Capella Bangkok Opens 2 Verandah Suites and 6 Riverfront Villas  Air Astana to Trial IATA Travel Pass on Nur-Sultan - Istanbul Flights  Jet2 Orders 36 Airbus A321neo Aircraft  Strong Air Cargo Demand Continues in July  Bill Courtney Joins CWT as EVP and CFO  Marriott Opens First Le Meridien Resort in Maldives  Executive Appointments at Emirates  Minor Hotels Signs Third Anantara Resort in Bali, Indonesia  Bill LaPeer Joins CWT as VP of Enterprise Vertical Sales  Shadi Suleman Returns to Qatar as GM of Four Seasons Hotel Doha  Melia Chiang Mai Appoints Director of F&B and Executive Chef  Bangkok Airways to Resume Five Routes  Qatar to Host Biennial Geneva Motor Show from 2023  Plaza Premium to Open Airport Lounge at GRU in Sao Paulo, Brazil  Embraer Opens Office in Budapest, Hungary  Thailand Added to UK's Red List  Singapore Airlines Launches Upcycling Project and Competition with SUTD  Air Astana Takes Delivery of Sixth Airbus A321LR  Malaysia Airlines Upgrades Enrich Loyalty Programme  EU Digital COVID Certificate Should Serve as Blueprint for Other Nations  Bombardier Delivers Fifth Jet for Saab's GlobalEye Surveillance Solution  W Hotel Opens in Philadelphia, USA  Etihad Engineering Partners IAI for Passenger to Freighter Conversions  How's Business in Cambodia? Video Interview with Richard Dusome, MD - Dara Hotels  Puri Hiranprueck (ภูริ หิรัญพฤกษ์) Promotes Family's Private Island Near Phuket  Six Senses Offers Guests Luggage Free Travel  HD Videos and Interviews  Podcasts from HD Video Interviews  RSS News Feed and Ticker  Travel Trade Shows in 2020 and 2021  High-Res Picture Galleries  Travel News Asia - Latest Travel Industry News 

Receive our Latest Travel News Daily Email free of charge by entering your email address and name in the boxes to the right and clicking subscribe. You can also receive the news by WhatsApp, stay updated with our RSS Feed Travel Industry News by TravelNewsAsia.com, and even Add the Headlines to Your Website free of charge. Have questions? Please read our travel news FAQ.

     
Advertising
Advertising
Copyright © 1997-2021 TravelNewsAsia.com