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Sat 14 Nov 2009 12:43 PM

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Air Arabia Q3 profit down 9% on H1N1, Ramadan

Sharjah-based carrier makes net profit of $39.2m in the three months to end-Sept.

Budget carrier
Air Arabia

warned of "significant" short-term challenges after posting its first-ever drop in quarterly profit, following the global H1N1 virus flu pandemic and the fasting month of Ramadan.

The largest Arab airline by market value said on Saturday third-quarter net profit fell 9 percent to 144 million dirhams ($39.2 million), beating analyst forecasts.

"Passenger traffic in the third quarter of 2009 was impacted by the seasonality of the Holy month (Ramadan), concerns related to the H1N1 virus and the continuing consequences of the global continuous financial downturn," it said in a statement.

Challenges ahead remained "significant", especially in the short term, Chief Executive Adel Ali said in the statement.

The carrier restated third quarter 2008 net profits at 158 million dirhams.

In a survey conducted by Reuters in October, analyst forecasts for third-quarter net profit ranged from 110.2 million dirhams and 129 million dirhams.

Net profit during the first nine months of the year was up 6 percent from last year at 337 million dirhams.

Passenger numbers between January and September came to 2.96 million, up from 2.6 million a year earlier, the company said, without disclosing third-quarter figures.

The average seat load factor - a measure of how successful airlines are in filling seats - stood at 79 percent in the nine months to end-September,
Air Arabia

said.

Turnover during the same period fell 2 percent compared to last year, coming in at 1.47 billion dirhams, it said.

Airlines around the world have been crippled by reduced spending on travel, a drop in global trade and rising oil prices.

Air Arabia

competes with Kuwait-based
Jazeera Airways

and Saudi-based Nas Air and Sama. On Thursday,
Jazeera Airways

posted a 53.2 percent-fall in third-quarter net profit. (Reuters)

Also read:

Jazeera Airways Q3 profit down 53% on revamp

Arabian Business: why we're going behind a paywall

Joe Karcia 10 years ago

How many airlines do we need here? Better off to have Etihad and Emirates merge to create a National airline that would be more powerful. And when flyDubai matures, have them merge with Air Arabia to create yet another National low cost carier. Why compete with a brother an hour away.