Rising fuel costs squeeze profits at Air Arabia
Low cost carrier Air Arabia has reported a 26 per cent decline in third quarter profits as the regional political unrest and rising fuel costs hit earnings.
Profits for the three months ending September 30 declined to US$27.2 million compared to approximately $37 million for the same period the previous year, the firm said in a statement on Tuesday.
Turnover for the third quarter increased 22 per cent from $154 million in 2010 to $188 million while passenger traffic increased five per cent, the Sharjah-based airline said.
“The challenging markets conditions we have seen in the second quarter of this year continued in the third quarter, with a further escalation in the political turmoil in several countries and an upward trend in the average fuel bill,” the airline said in a statement.
“Despite these challenging market conditions, Air Arabia’s solid profits and steady growth reflect the airline’s commercial and operational strength."
Regional carriers such as Air Arabia are recovering from the impact the regional political turmoil, which forced them to cancel flights and delay growth plans.
Air Arabia in the third quarter took delivery of two new A320 aircraft and started operations to Gassim in Saudi Arabia.