Emirates 2013 — Interim / Quarterly Report 2012

Nov 12, 2012

Emirates Group Announces Half Yearly Profits

• Emirates Group records AED 2.1 billion (US\$ 575 million) net profit up 68 per cent
• Cash position strong with current balance of AED 15.2 billion (US\$ 4.1 billion)
• Seat Factor increased to 80%
• Five new destinations and 13 new aircraft added to Emirates operations
• Emirates net profit is AED 1.7 billion (US\$ 464 million) up 104 per cent $\bullet$

DUBAI, UAE - 12 November 2012 - The Emirates Group today announced its half yearly results which remain robust despite continued global economic pressure and continued high fuel prices.

The Emirates Group posted a AED 2.1 billion (US\$ 575 million) net profit for the first six months of its current fiscal year ending $30^th$ September 2012, up 68 per cent from AED 1.3 billion (US\$ 343 million) from 30^th September 2011.

Despite fundamental challenges, the Group's revenue and other operating income rose to AED 38.2 billion (US\$ 10.4 billion) an increase of 16 per cent over the last year's results. This constitutes the first time in the Group's history that revenue surpassed the US\$ 10 billion mark in a six month period. The Group's cash position on 30th September 2012 remained strong at AED 15.2 billion (US\$ 4.1 billion), compared to AED 17.6 billion (US\$ 4.8 billion) as of March end 2012. The AED 2.4 billion difference in the cash balance is primarily resulting from a AED 2.0 billion Sukuk bond repayment in June 2012.

"The Emirates Group half-year performance is the result of hard work and our drive to stay on course and continue to grow despite the precarious marketplace," said His Highness (HH) Sheikh Ahmed bin Saeed Al Maktoum, Chairman and Chief Executive, Emirates Airline and Group. "We have continued to invest in the infrastructure of both Emirates and dnata and it continues to pay off."

Even with a challenging operating environment, the Group continued to invest in and expand on its employee base, increasing its overall staff count by more than 8 per cent in just six months to nearly 68,000.

During the first six months of the fiscal year Emirates received 13 wide-body aircraft, including two A380s and ten Boeing 777s and one freighter, with more than 15 new aircraft scheduled to be delivered before the end of the financial year (31 March 2013). As the fleet increased, Emirates further invested in its network by adding five new destinations that have joined the 10 new routes added since 30 September 2011, for a total of 15.

On its strong upward trajectory, Emirates continues to be one of the fastest growing airlines in the world. In spite of unstable global economic, geopolitical and environmental conditions Emirates continues to make a profit. In the first half of the 2012-13 fiscal year, Emirates net profit is AED 1.7 billion (US\$ 464 million) up 104 per cent from AED 836 million (US\$ 228 million).

"Emirates remained focused on its growth and global expansion despite on-going fluctuating exchange rates and ever lingering high fuel prices which accounted for 39 per cent of our expenditures, down 2 percentage points from last year," said HH Sheikh Ahmed. "The instability in the market over the past six months has put Emirates to the test, and once again we have risen to the challenge, our results speak for themselves."

Equipped with the world's largest fleet of A380s and the largest fleet of Boeing 777s Emirates continues its broad, global expansion now flying to $126ⁱ$ destinations up from 114 last year to 74 countries compared with 67 last year. The airline has launched five new destinations since 1^st April 2012 including Ho Chi Minh City, Barcelona, Lisbon, Erbil and Washington, D.C. Additional new routes to be added during the second half of the fiscal year include Adelaide, which launched 1st November and the upcoming routes of Lyon, Phuket, Warsaw and Algiers.

New A380 destinations for the airline for the first six months of fiscal year 2012-13 included Tokyo and Amsterdam bringing the total number of A380 destinations to 19.

In the first-half of its financial year 2012-13, Emirates posted strong business growth, both in terms of capacity on offer and traffic carried, performance that has been in sharp contrast to the current trend seen across the aviation industry. Capacity measured in Available Seat Kilometres (ASKM), grew by 17.3 per cent, whilst passenger traffic carried measured in Revenue Passenger Kilometres (RPKM) was up 17.8 per cent with Passenger Seat Factor sustained at a high level, averaging 80 per cent, slightly above last year's 79 per cent. Emirates carried 18.7 million passengers since 1^st April 2012, up 15.4 per cent for the same period last year. The volume of cargo uplifted was up by more than 16 per cent, a significant growth against the market trend.

Emirates revenue, including other operating income, of AED 35.4 billion (US\$ 9.7 billion) was higher by 17 per cent compared with AED 30.2 billion (US\$ 8.2 billion) recorded last year, largely reflecting a strong passenger yield based on constant high fuel prices.

In the summer of 2012, the financial community continued to show confidence in Emirates as the airline successfully raised financing for four A380's using the debt capital market in the United States - a first for a non-US airline for many years.

dnata continues to grow internationally and reinvest in the global business infrastructure, dnata's revenue including other operating income is AED 3.9 billion (US\$ 1.1 billion), 9 per cent higher compared to AED 3.6 billion (US\$ 968 million) last year. This is the first time in dnata's 53 year history the company achieved US\$ 1 billion in revenues in six months.

During the year, dnata's operating costs increased by 11 per cent to AED 3.4 billion (US\$ 940) million) due to increased costs of doing business in the global market place. Overall profit for dnata is slightly down 4 per cent at AED 407 million (US\$ 111 million), a positive performance set against the significant competition challenges within the aviation industry.

Revenue from dnata's Travel Services operation contributed most significantly to the organization's revenue through the first time integration of Travel Republic for the first six months reporting period as it was acquired in December 2011.

dnata's cargo handling division also witnessed upward growth with revenues increasing by 5 per cent to AED 524 million (US\$ 143 million) on account of increased tonnage at Dubai International Airport and Singapore Changi Airport which rose by 5 per cent to 791,151 tonnes.

dnata's in-flight catering operation, accounted for AED 1.4 billion (US\$ 377 million) of its total revenue. The number of meals uplifted at 27.5 million meals for the first half of the fiscal year, down slightly, at 2.4 per cent compared to last year.

Revenue from dnata's airport operations increased by 4 per cent reaching AED 1.2 billion (US\$) 324 million). The increase is due primarily to increased volumes at Dubai and Singapore airports. The number of aircraft handled by dnata also increased to 130,684, up 5.6 per cent.

-ENDS-

As of 30 September 2012

Emirates INTERIM CONSOLIDATED INCOME STATEMENT FOR THE SIX MONTHS ENDED 30 SEPTEMBER 2012

	Unaudited	Unaudited
		30 Sep 2012 30 Sep 2011
	AED m	AED m
Revenue	34,092	29,849
Other operating income	1,328	337
Operating costs	(33,480)	(29, 168)
Operating profit	1,940	1,018
Finance income	208	186
Finance costs	(405)	(314)
Share of results in associates and joint ventures	54	40
Profit before income tax	1,797	930
Income tax expense	(41)	(48)
Profit for the period	1,756	882
Profit attributable to non-controlling interests	52	46
Profit attributable to Emirates' Owner	1,704	836

INTERIM CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME FOR THE SIX MONTHS ENDED 30 SEPTEMBER 2012

Profit for the period	1.756	882
Currency translation differences	2	(24)
Cash flow hedges	(271)	(113)
Other comprehensive income	(269)	(137)
Total comprehensive income for the period	1.487	745
Total comprehensive income attributable to non-controlling interests	52	46
Total comprehensive income attributable to Emirates' Owner	1.435	699

Prior period figures have been reclassified to conform with the current period's presentation.

Emirates INTERIM CONSOLIDATED STATEMENT OF FINANCIAL POSITION

AS AT 30 SEPTEMBER 2012

	Unaudited	Audited
	30 Sep 2012 31 Mar 2012
	AED m	AED m
ASSETS
Non-current assets
Property, plant and equipment	52,362	49,198
Intangible assets	910	902
Investments in associates and joint ventures	465	430
Advance lease rentals	499	370
Loans and other receivables	750	917
Derivative financial instruments	62	69
Deferred income tax asset	7	10
	55,055	51,896
Current assets
Inventories	1,587	1,469
Trade and other receivables	8,974	8,126
Derivative financial instruments	1	8
Short term bank deposits	8.657	8,055
Cash and cash equivalents	4.514	7,532
	23,733	25,190
Total assets	78,788	77,086

	Unaudited	Audited
	30 Sep 2012 31 Mar 2012
	AED m	AED m
EQUITY AND LIABILITIES
Capital and reserves
Capital	801	801
Retained earnings	22,960	21,256
Other reserves	(1,102)	(833)
Attributable to Emirates' Owner	22,659	21,224
Non-controlling interests	262	242
Total equity	22,921	21,466
Non-current liabilities
Borrowings and lease liabilities	27,023	26,843
Provisions	1,555	1,350
Deferred revenue	1,244	1,074
Deferred credits	323	350
Derivative financial instruments	1.214	957
Current liabilities	31,359	30,574
Trade and other payables	19,154	19,882
Income tax liabilities	27	36
Borrowings and lease liabilities	4.158	4,037
Deferred revenue	1,018	915
Deferred credits	110	136
Derivative financial instruments	41	40
	24,508	25,046
Total liabilities	55,867	55,620
Total equity and liabilities	78,788	77,086

Prior period figures have been reclassified to conform with the current period's presentation.

Airline Operating Statistics

Performance Indicators		Sep-12	$Sep-11$
Yield	Fils per RTKM	250.1	254.3
Unit cost	Fils per ATKM	165.8	165.8
Unit cost excluding jet fuel	Fils per ATKM	99.0	96.3
Breakeven load factor	%	66.3	65.2
Fleet
Aircraft	number	183	158
Average fleet age	months	77	88
Production
Destination cities	number	126	114
Overall capacity	ATKM million	19,662	17,097
Available seat kilometres	ASKM million	113,095	96,384
Aircraft departures	number	77,521	69,221
Traffic
Passengers carried	number million	18.7	16.2
Passenger seat kilometres	RPKM million	90,117	76,498
Passenger seat factor	$\%$	79.7	79.3
Cargo carried	tonnes '000	1,027	884
Overall load carried	RTKM million	13,247	11,381
Overall load factor	$\%$	67.4	66.6
Employee
Average employee strength (including subsidiaries)	number	46,195	41,263
Operating lease
Future minimum lease payments Aircraft fleet	AED million	35,816	32,497