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Mon 28 Aug 2017 01:05 PM

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flydubai posts $38m losses despite rise in half-year revenues

Low-cost carrier's CEO says demand for travel remains strong, will continue to manage costs

flydubai posts $38m losses despite rise in half-year revenues

flydubai on Monday announced losses of AED142.5 million ($38.8 million) for the first half of 2017.

The low-cost airline also reported total revenue of AED2.5 billion, an increase of 9.9 percent compared to the first six months of last year.

The carrier said in a statement that passenger numbers increased to 5.4 million, an increase of 10.5 percent compared to the first six months of 2016.

During the first six months of 2017, flydubai contributed 12.4 percent of all traffic in Dubai.

flydubai said demand for travel "remains strong" and the airline has seen its overall market share grow. These factors have, however, been offset by the price performance determined by the market. The airline also faced comparatively higher fuel expenses during the reporting period.

Ghaith Al Ghaith, CEO of flydubai, said: “The demand for travel from the growing number of our passengers remains strong. We will however continue to manage our cost performance and balance this with our long-term view of the potential for air travel in the region. We know that we need to remain flexible to the market dynamics across our network.

"We will continue our disciplined approach to increasing capacity whilst pursuing our broader goal of firmly establishing flydubai at the centre of the global travel industry.”

The airline is building a new headquarters office located on the Emirates Road and is expected to be available for occupation from 2019. This investment will support the airline’s continued growth, it said.

Saj Ahmad, chief analyst, StrategicAero Research, said: "Bringing down unit costs is key for flydubai. Revenue increased by almost 10 percent, so it’s evident that the airline has scope to push down harder on costs, despite the challenging price backdrop. As with 2016, flydubai is primed to turn around its losses before its reporting year ends in early 2018."

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