DUBAI: Middle East's largest low-cost carrier Air Arabia said first-quarter profit almost doubled after it carried more passengers. The carrier, based in Sharjah, said net income in the three months to March 31 surged to 78 million UAE dirhams ($21.24m) from 43 million dirhams in the same period last year.
Turnover rose 59 per cent to 383m dirhams and the number of passengers rose to 757,000 from 577,000 in the year-ago period, it said.
Average load factor for the first three months of the year - the percentage of seats occupied on each flight - was 85pc compared with 83pc in the same period last year.
"The quarter was good because of more passengers and seat factor, even with the challenges of continued inflation and high oil prices," chief executive officer Adel Ali said.
Despite a challenging environment, its objective was to achieve similar profit growth this year to last year, Ali said.
Profit last year jumped to 376m dirhams from 101m in 2006.
"High oil prices are a double-edged sword, in one way the economy is good because of high oil prices, which means more people travel and what is helping is higher fuel surcharge," said Ali, adding the high seat factor was the real driving force behind quarterly results.
The airline, whose shares have rallied more than 90pc since it listed on the Dubai Financial Market last July, will probably carry 30 percent more passengers this year as it expands its fleet. It added two new Airbus A320 aircraft in March, taking its fleet to 13.
The company, which in November ordered $3.5 billion of aircraft from Airbus SAS, carried 2.7m passengers last year, an increase of 53pc.
"We are in close discussions (for borrowing) with financial houses for our bulk purchase... when we're looking at just under $3bn, we are eyeing all options," Ali said, adding the airline is considering Islamic and conventional bonds, or loans.
"We are looking at the latter part of this year to finalise."
The airline has added two new destinations in India this year raising its total number of destinations to 39, and opened its new hub in Kathmandu, Nepal.
It signed a similar initial agreement last year to use the Moroccan city of Rabat as a hub for Africa and Europe.
It plans to open as many as six new routes in the remaining three quarters, Ali said.
In a Reuters survey, Cairo-based investment bank EFG-Hermes and Deutsche Bank forecast the company would post profit of 70m dirhams and 92m dirhams respectively, in the first quarter.
