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Tue 5 Jan 2016 01:48 PM

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Dubai Duty Free records 0.6% drop in sales on the back of weak Euro, falling Russian spending

Retailer also attributed decline to a shift away from high-end brands by Chinese passengers

Dubai Duty Free records 0.6% drop in sales on the back of weak Euro, falling Russian spending
Dubai Duty Free

Dubai Duty Free
recorded a slight drop in sales last year, from AED6.999 billion ($1.917
billion) in 2014 to AED6.892 billion ($1.888 billion) in 2015.

The company
attributed the 0.6 percent decline to an estimated AED200 million drop in
spending by Russian tourists last year, as well as the weak Euro and a shift
away from high-end brands by Chinese passengers. 

Colm
McLoughlin, executive vice-chairman at Dubai Duty Free, described 2015 as a
“challenging retail environment”.

“The weak Euro
has impacted business and we are working with our suppliers to balance this
out,” he said in a statement to Arabian Business. “There has also been a slight
change in the buying patterns of Chinese passengers who are not always looking
for high end brands but are looking increasingly at mid-range brands.”

He added: “On
the upside, we have seen an increase in spend by other nationalities, including
African passengers and GCC and Indian travellers. With challenges come
opportunities and we have consistently looked at ways of improving our retail
offer to an increasingly diverse passenger mix.

“We have
collaborated more with our suppliers to ensure that we are delivering the right
products at the right prices wherever possible. We have increased our online
presence this year and as a result our online sales are around AED50 million.
We expect this to double in 2016.”

Dubai Duty
Free, which operates at both Dubai International Airport and Al Maktoum
International, reported group turnover of AED7.057 billion ($1.933 billion) for
2015, which included the group’s airport and leisure operations.

The company
recorded its highest sales for the year last month when figures reached
AED721.87 million.

December sales
were fuelled by Dubai Duty Free’s 32nd anniversary celebrations, it added.

It recorded
26,848,832 sales transactions in 2015, which is an average of 73,558 sales
transactions per day across both Dubai International and at Al Maktoum
International.

Perfumes were
the highest selling category with annual sales topping AED1.137 billion
($311.58 million) – 16.50 percent of total annual sales, it said. Liquor and
cigarettes followed, with sales of AED1.069 billion ($293million) and AED589.67
million ($161.55million) respectively.

Confectionery
followed, with sales amounting to AED556.14 million ($152.37 million), then
gold, with AED549.32 million ($150.50 million).

Departure sales
accounted for 87 percent of total sales in 2015, Dubai Duty Free said, with
sales reaching AED5.989 billion ($1.640 billion).

There was a six
percent increase in arrivals sales over last year and accounted for 11 percent
of the total – although Dubai Duty Free did not provide a figure.

Meanwhile,
Terminal 2 recorded an 18 percent increase in sales over last year to reach
AED639.52 million ($175.21 million).

McLoughlin
said: “Overall, it has been a very good year and I would like to thank HH
Sheikh Ahmed bin Saeed Al Maktoum, president of Dubai Civil Aviation Authority
and chairman of Dubai Duty Free, for his ongoing support and I join His
Highness in thanking our great team of staff, our suppliers and of course our
customers, who are fundamental to our continued growth.”

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