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Wed 10 Nov 2010 12:46 PM

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Air Arabia posts 5.6% fall in Q3 net profit

Low-cost carrier reports net profit of AED136m for the three months to September 30

Air Arabia posts 5.6% fall in Q3 net profit
Air Arabia announced this week that it will add an extra two flights per week to Kathmandu in Nepal , and three extra flights to Chittagong in Bangladesh, starting from September 1 in a move to boost its South Asian presence.

Low cost carrier Air Arabia posted a 5.6 percent decline in net profit for the third quarter on Wednesday, beating analysts’ forecast.

Air Arabia reported a net profit of AED136m ($37.03m) for the three months to September 30, 2010, down from AED144m for the same period a year earlier.

Revenue for the quarter was AED568m, a rise of four percent compared with AED548m a year earlier.

Analysts forecast average profit of AED90.99m, according to a Reuters’ survey in October.

“Air Arabia continues to post sustained quarterly profits with a high seat load factor and rising passenger traffic, demonstrating the strength of Air Arabia’s business model and long-term expansion strategy,” said chairman Sheikh Abdullah Bin Mohammed Al Thani in an emailed statement.

The low-cost airline served 1.14m passengers in the quarter, a rise of 14 percent on the same period a year earlier.

Seat load – or passengers carried as a percentage of available seats – stood at 84 percent for the quarter, a rise of 8.4 percent compared to the year-earlier period.

Adel Ali, CEO of Air Arabia, said earlier this week that he expected the launch of the carrier's fourth hub in Jordan to take place in 2011.

The carrier has ordered 44 aircraft valued at $3.6bn with 43 yet to be delivered.

"One aircraft will come before the end of the year [2010]," he told reporters at a business event in Dubai. "We have a deal for four airplanes with [export credit financing] at $160m with the Bank of Japan."

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