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Tue 8 Jun 2010 04:27 PM

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Etihad CEO says buyouts possible in future

Varrier focusing on making money for now; business class seat load factors have improved.

Etihad CEO says buyouts possible in future
HIGH FLYING: IATA said on Monday it expects Middle East carriers to post a profit of $100 million this year.(Getty Images)

Abu Dhabi-based carrier Etihad Airways may consider acquisitions in the future but will concentrate for now on reaching the break-even point, its chief executive said. "At the moment, I am focusing on my mandate, which is to support Abu Dhabi and to make money," James Hogan told Reuters in an interview on the sidelines of global airlines body International Air Transport Association's (IATA) annual meeting.

He said any decision on acquisitions was up to the airline's shareholders, while management's job was to review the business model and submit different scenarios to the board.

"Let's see what comes next," he said, but brushed off speculation that Etihad could be interested in Air Berlin, Germany's second-biggest airline after Lufthansa.

IATA said on Monday it expects Middle East carriers to post a profit of $100 million this year - their first since 2005 - after losing $600 million in 2009 due to a swine flu epidemic and the global economic crisis that weighed on demand.

The global industry will likely record total profits of $2.5 billion, IATA said, a stunning change from its previous estimate published in March that called for a $2.8 billion loss for 2010.

The global airlines body had said in March it expects Middle East carriers to post a $400 million loss this year.

Etihad, which operates service to 61 destinations in 40 countries and operates a fleet of 53 aircraft, saw its first-quarter traffic as measured by revenue passenger kilometres grow 25 percent, helped by expansion.

"We are bullish for the second quarter," Hogan said, adding that demand for premium-class travel, which is more profitable than economy class for most airlines, was improving.

"The business-class seat-load factor is back where we want it to be, and the yield is tracking in the right direction." (Reuters)

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Arabian 10 years ago

Air Arabia have been profitable in every year since formation. They are however not a member of IATA.