Air Arabia recently disclosed their Q2 and 1H results, the airline recorded a loss of AED239 million (USD65 million) for the second quarter of 2020 and a 2020 first half loss of AED169 million (USD46 million). The losses are the results of the impacts brought on by the COVID-19 Pandemic that has negatively impacted the airline’s finances and operations.
The carrier’s turnover for the first half of 2020 amounted to AED1.021 billion (USD278 million), a 53% reduction compared to the AED2.173 billion (USD591 million) made for the same period last year, the fall in turnover was a result of the fall in passenger figures to 2.48 million which was a 57% drop compared to the same period last year across their hubs.
With many countries putting in place travel and border restrictions to curb the spread of the virus meant that the airline’s Q2 operations largely focused on charter, repatriation and cargo flights which impacted revenue figures severely.
Air Arabia Route Map
Source: Air Arabia
Like many airlines around the world, Air Arabia took measures to conserve and preserve cash. A large part included reducing expenses in the form of deferred cost and capital expenditure, cost rationalisation and efficiency while also restructuring the workforce which according to the airline has resulted in reducing their overall costs while preserving liquidity.
The Chairman of Air Arabia, Sheikh Abdullah Bin Mohamed Al Thani stated that the airline is in a strong position to weather the impact of the pandemic with a long-term view of business continuity as their prime focus.
The Carrier has recently added a new hub in Abu Dhabi to complement its services from its existing hubs in the UAE, Morocco and Egypt.
The airline ends the first half of the year with a strong liquidity position of over AED3 billion (USD816 million) in cash. Their outlook looks at returning to scheduled services as markets open up and taking actions to control costs while enhancing and preserving their liquidity position.