Strong demand drives surge in Dubai's Emirates airline H1 profit

DUBAI (Reuters) - Emirates airline, Dubai's flagship carrier, posted a significant jump in net profit for the first half of financial year 2023-24 on the back of strong demand, the company said on Thursday, while Group profit surged to a record high.

Emirates' profit soared 134% year-over-year to 9.4 billion dirhams ($2.56 billion) in the first six months of its financial year. Revenue rose 19% to 59.5 billion dirhams.

While overall direct operating costs rose 9% due to expanded operations, fuel costs, the airline's biggest payment, accounted for 34% of expenses, slightly lower than the year-ago period.

The airline said it filled an average of 81.5% of seats in the first half, compared with 78.5% last year.

Dubai, widely considered the Gulf's tourism and business hub, bounced back strongly after its services-dominated economy came to a near standstill during the COVID-19 pandemic. The rebound in travel and tourism was a key component of that recovery.

The business was now "seeing the fruition of our plans to return stronger and better from the dark days of the pandemic," said Sheikh Ahmed bin Saeed Al Maktoum, chairman and CEO of Emirates Airline and the Group.

Emirates Group reported a record half-year profit of 10.1 billion dirhams, up 138% year-on-year, with revenue increasing 20% to 67.3 billion dirhams due to strong demand for international travel.

Sheikh Ahmed said customer demand in the second half was expected to remain healthy across the business.

"At the same time, we are keeping a close watch on headwinds such as rising fuel prices, the strengthening U.S. dollar, inflationary costs and geopolitics."

The group's global airport and travel services business, dnata, made a 709 million dirham profit, a 200% year-on-year increase, while revenue jumped 27% to 9.3 billion dirhams. ($1 = 3.6728 UAE dirham)

(Reporting by Rachna Uppal; Editing by Savio D'Souza)