Flydubai (JBX) B3C Flight Takeoff. Photo: Flydubai

LONDON – Dubai-based carrier flydubai has announced a loss of US$53.6m for the half-year period ending June 30 this year.

This represents a 38% reduction compared to the first half of 2018.

Revenues for the carrier remains unchanged from the same six-month period and is reported to be at US$759 million.

Fuel costs for the airline have decreased by 17.3% to AED740million from AED895million.

The airline did say that full potential fuel savings have not been “realised due to the deployment of the Next Generation Boeing 737-800 aircraft on our longer routes”.

Commenting on the findings was Ghaith Al Ghaith, the Chief Executive Officer who expressed this as positive.

“We had reported in our 2018 Full-Year Results that we were cautiously optimistic at the start of 2019.  We had seen positive results as our routes matured and during the first few months of the year we saw strong demand across the network.”

“Our performance has however been significantly impacted by the grounding of the Boeing 737 MAX aircraft and our Half-Year Results are not representative of what we had expected to report; we were expecting a significantly improved performance.”

However, passenger numbers have dropped to five million during the first six months, which is a 7.5% decrease due to a reduction in capacity.

Even then, services to the likes of Tashkent (Uzbekistan), Naples (Italy) and Sochi (Russia) were launched, which brought the portfolio count to 92 destinations in 48 countries.

Such reduction has been attributed to the grounding of 11 Boeing 737MAX8s and three 737MAX9 aircraft.

On top of this, the airline retired five aircraft and they were returned to the lessor, with the airline taking delivery of one 737MAX8 before it was grounded.

As a result of such groundings, the airline stated in its outlook that it has negotiated an extension to the lease for two Boeing 737-800 Next-Generation aircraft which were supposed to leave next year. The aircraft will now leave in 2022 instead.

Also commenting on the financials was Francois Oberholzer, the Chief Financial Officer at the carrier who went into more detail about the MAX groundings.

“In light of the grounding, we have taken every effort to minimise flight cancellations and maximise revenue opportunities.  Unavoidably, this led to a reduction in ASKM by 14.9% which meant that we were not able to fully exploit demand opportunities.”

“The cost efficiency programmes, we introduced at the beginning of the year, have yielded the planned benefits with the exception of the fuel efficiencies from the MAX deployment plan.”

“These programmes were never intended nor could have offset the financial impact of the grounded Boeing 737 MAX aircraft”, he added.

It remains clear that even in the wake of some difficulties, flydubai is trying to put all the stops out to reduce the losses even further.

It will be interesting to see whether any more route cuts will be implemented and whether this can be turned around.