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Emirates' Half-Year Performance Hits New Record

Media Release
7 November 2006

Emirates' Half-Year Performance Hits New Record

US$323 million net profit, up 29 percent

Emirates Airline has announced yet another record performance with net profit for the first six months of the current financial year 2006-07 at Dirhams 1.2 billion (US$ 323 million), up 29 per cent compared to Dhs 922 million (US$ 251 million) recorded in the same period last year.

The results reflect a strong revenue performance driven by robust passenger and cargo demand, and better yields, which softened the impact of high fuel prices on operating costs.

Emirates' operating revenue of Dhs 13.5 billion (US$3.67 billion) for the half-year represented a strong growth of 30 per cent compared to revenue of Dhs 10.4 billion (US$2.84 billion) during the same period last year.

Passenger revenue recorded a 31 per cent growth, with passengers carried increasing by 1.41 million or 20 per cent to 8.39 million, compared to 6.98 million for the first half-year of 2005-06. Seat factor improved to 76.4 per cent for the period, reflecting the robust demand in tandem with an increased passenger seat capacity (in terms of available seat kilometres) of 25 per cent, versus the same period last year.

Emirates SkyCargo continued its steady revenue growth, posting an increase of 29 per cent to Dhs 2.7 billion, with cargo tonnage up by 20 per cent to 577,455 tonnes, compared with 482,643 tonnes for the same period last year, and maintained its contribution at about 21 per cent of the airline's transport revenue.

Emirates' Chairman & Chief Executive, H.H. Sheikh Ahmed bin Saeed Al Maktoum, said: "Emirates has delivered another excellent half-year performance, maintaining capacity and revenue growth despite the challenges faced by high fuel costs.

"Emirates has been in a strong position to tap into the robust demand for air travel globally by expanding its route network with new high-capacity aircraft, and investing in passenger services such as dedicated airport lounges across Europe, the Far East and Australasia. In the coming months, we intend to continue with our growth plans while keeping a close watch on costs."

Fuel costs for the first six months crossed US$1 billion and remained the top expenditure accounting for 30.7 per cent of total operating costs, up from 27.2 per cent for the full period last year. Measures taken by Emirates to remain on target include stringent cost-containment and efficiency drives, but like other airlines, Emirates has been forced to maintain fuel surcharges on tickets, which do not fully cover the escalating costs.

Emirates' cash position, including held to maturity investments, on 30th September 2006 was healthy at Dhs 11.2 billion (US$ 3.04 billion), an increase of 15 per cent compared to Dhs 9.7 billion (US$ 2.65 billion) six months earlier. This was after paying dividends of Dhs 386 million (US$105 million) to the ownership pertaining to the past financial year, and funding capital outflows of around Dhs 1.46 billion (US$ 398 million) that included aircraft pre-delivery payments and other capital items.

Since January 2006 Emirates has launched services to 10 new cities - Abidjan, Addis Ababa, Bangalore, Beijing, Hamburg, Kolkata, Lilongwe (cargo-only), Nagoya, Thiruvananthapuram and Tunis - bringing the network total to 87 cities including four cargo-only destinations. In addition, it increased the frequency of passenger services and also added capacity with larger aircraft to many of the existing destinations, including a second daily service to Zurich and a third daily into New York via Hamburg.

Emirates operates four flights a day from New Zealand to Dubai and beyond via Australia.

With the addition to the fleet of nine new aircraft since March 2006, Emirates' current fleet size is 100 - which comprises 29 Airbus A330-200s, 22 Boeing 777-300ERs, 12 Boeing 777-300s, nine Boeing 777-200s, 10 Airbus 340-500s, eight A340-300s, one Airbus A310, and nine freighters - six Boeing 747Fs and three Airbus A310F.

The total value of Emirates' current orders of more than 100 wide-bodied jets pending delivery is approximately US$30 billion. These include the recently-signed contract for 10 firm Boeing 747-8Fs worth US$2.8 billion at list prices and purchase rights for 10 additional 747-8Fs.

ENDS

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