Blockade blunts Qatar bottom line

DOHA, Qatar 19 September 2018: A blockade by Qatar’s neighbours caused lower revenue growth since June 2017, Qatar reported in a preamble to it’s annual financial results 1 April 2017 to 31 March 2018.

The airline described the financial year the “most challenging year in its 20-year history,” reporting a loss attributed to the owner of QAR252 million.

But it claimed positive operating cash in flow during the year that demonstrated the airline’s core “strength and resilience in the face of adversity.”

Overall revenue and other operating income grew 7.22% annually compared to capacity (Available Seat Kilometres) growth of 9.96%.

The alleged illegal blockade of Qatar air space, since 5 June 2017, impacted departing seats by 19%.

The airline group generated EBITDAR Margin of 23% at QAR 9.714 billion. EBITDAR was lower than the previous year by QAR 1.759 billion, due to longer flying time resulting from the blockade and loss of departing seats from the blockading countries.

Highlights of the financial report showed the airline declaring a loss, attributed to the owner, for the fiscal period 2017 to 2018, of QAR252 million compared with a profit of QAR2,794 million in the 2016/2017 fiscal year.

Revenue and other operating income for the year ending March 312 2018 was QAR42,279 million.

The airline carried 29,162,000 s during the year down from 32,007,000 in the 2017 fiscal year.

Replacing 18 mature routes, which were closed due to the blockade, the airline opened 14 new destinations during the fiscal year under review (24 new destinations to date).

However, establishing new destinations came with heavy launch costs and the necessity to establish market presence, which attributed to the overall net loss of QAR252 million. With a positive operating cash inflow, the cash position of the Group remained strong at QAR13.312 billion.

Qatar Airways group chief executive, Akbar Al Baker, said: “This turbulent year has inevitably had an impact on our financial results, which reflect the negative effect the illegal blockade has had on our airline. However, I am pleased to say that thanks to our robust business planning, swift actions in the face of the crisis, our passenger-focused solutions and dedicated staff, the impact has been minimised.”

New destinations to Sohar, Prague and Kyiv were announced and launched, while other routes saw an increase in frequency and capacity, thus swiftly redeploying capacity with a view to soften the impact of being blockaded from 18 regional gateways.

The airline has now launched 24 new destinations, further expanding its network of more than 150 gateways worldwide.

In addition to taking delivery of the Airbus A350-1000 in February 2018, the airline added 20 other aircraft to the fleet throughout the financial year, increasing the fleet to 213 (a31 March 2018).

During the financial year, Qatar Airways Group also continued apace with the expansion of its investment portfolio to include an initial 9.94% stake in Cathay Pacific, which has since increased to 9.99%, as well as a 49% share of AQA Holding, the parent company of Meridiana fly, which was relaunched as Air Italy in February 2018.

The airline plans new services to Gothenburg, Sweden, Danang, Vietnam and Mombasa.