Air Arabia, a carrier based in Sharjah, United Arab Emirates, reported results for the first half of 2024. This lesser known airline operating from multiple hubs across the Arab world is gearing up to be a significant player on the low-cost market.
Consistently Profitable
Since Air Arabia started publishing results in 2006, it has been consistently profitable, excluding the incomparable year of 2020. The first half of 2024 is no different; the company reported revenue of $871 million with an operating profit of $155 million. Compared to the first half of the prior year this is a 13% increase in revenue but a -17% decrease in operating profit.
Sheikh Abdullah Bin Mohammad Al Thani, Chairman of Air Arabia, commented on this development: “Despite the robust passenger demand, the aviation industry continued to experience slower yield growth and rising costs during the second quarter of this year, driven by economic and geopolitical uncertainties, currency fluctuations, fuel price volatility, and supply chain disruptions that have led to increased inflationary pressures. Air Arabia’s ability to sustain its growth momentum and achieve such solid profitability amidst these challenges reflects the resilience of our business model and the strength of our management team.”
The carrier is growing its fleet of Airbus A320 family aircraft, adding four frames already this year. Despite the fleet growth, the airline can deploy its capacity on such markets that the overall load factor performance is still in an upward trajectory, reaching 81,9% so far in 2024.
This figure, together with the growing fleet size, corresponds to 8.9 million passengers carried in the first half of the year. If the 15.8% growth is maintained throughout the year, the company might expect to reach around 19 million passengers carried in 2024.
The Arabian Carrier
Air Arabia is an Emirati low-cost airline, established in 2003 in Sharjah, United Arab Emirates. The company came into existence through an Amiri decree issued by Sultan bin Muhammad Al-Qasimi, the Ruler of Sharjah and member of the Supreme Council of the United Arab Emirates.
The main base of the carrier is located on the Sharjah International Airport, though over the years the company established multiple hubs and joint ventures in the Arab world. The main brand of Air Arabia is operating in Sharjah and Ras Al-Khaimah, two of the seven emirates forming the federation, with 47 airplanes in use.
In 2020 the company opened its third UAE base in Abu Dhabi, after signing an agreement with Etihad Airways. Now Abu Dhabi is the third biggest base for Air Arabia by number of aircraft located with 10 frames at the end of the first half of 2024.
In 2009 and 2010 Air Arabia went for a significant international expansion, opening bases in Morocco and Egypt respectively. Currently, all the bases in Africa have 15 aircraft, with 11 stationed in multiple bases in Morocco and four in Egypt. The most recent venture of the carrier is the formation of Fly Jinnah in Pakistan in late 2021.
The joint venture with Pakistani conglomerate Lakson Group was set to operate domestic and international routes from Pakistan. The airline quickly ramped up operations, now having assigned five aircraft from the Air Arabia’s fleet and locating its main base in Karachi, Pakistan.
