Qatar Airways reported a loss of 7 billion riyals ($1.92 billion) on Sunday for the year ending March 31, as the coronavirus crisis hurt the aviation industry around the world.
The airline also disclosed it had received a 7.3 billion riyal advance from its owner, the government of Qatar, after March that has since been converted into new shares. ($1 = 3.6411 Qatar riyals)
The state-owned airline group posted a widening net loss of 7 billion Qatari riyals (Dh7.06bn) in the fiscal year ending March 31, compared with a restated 4.75bn riyals a year earlier, Qatar Airways said on Sunday. Total group revenue and other operating income rose 6.4 per cent to 51.1bn riyals as it carried more passengers.
With the coronavirus pandemic taking a heavy toll on airline companies around the world due to the travel restrictions, the Qatari carrier struggled with losses that exceeded 50 percent of the share capital, according to the company’s annual fiscal report.
Qatar Airways said that this year has been one of its most difficult years due to the financial losses it sustained, which were much more than the QAR 4.5 billion from the previous year.
However, Qatar Airways is no stranger to sudden crises.
Due to the sudden 2017 air, land and sea blockade on Qatar by Saud Arabia, Egypt, the UAE and Bahrain, the airline company had to reroute its flights to bypass the illegal restrictions imposed, many industry analysts commended the way in which the airline adapted its business model to absorb the impact of the GCC crisis.
With this current pandemic still very much threatening global economies and both the airline and tourism industries being hit the hardest, the true impact on Qatar Airways remains unclear, but this stimulus from the government will put it in a much stronger position than most of its competitors.
Qatar Airways has grounded its fleet of Airbus A380s “as it is not commercially or environmentally justifiable to operate such a large aircraft in the current market”, it said in the statement. The airline’s fleet of 49 Airbus A350s and 30 Boeing 787s are best suited for long-haul routes to Africa, the Americas, Europe and the Asia-Pacific regions, it said. The airline has 205 passenger aircraft, 28 freighters and 25 executive jets in its fleet.
In its 2020-2021 fiscal year, the airline is reviewing renewed launch dates for destinations including Almaty in Kazakhstan; Dubrovnik in Croatia; Lyon in France; Nur-Sultan in Kazakhstan; Osaka in Japan; Santorini in Greece; Siem Reap in Cambodia; and Trabzon in Turkey, according to its annual report.
The International Air Transport Association expects the global airline industry to suffer a net loss of $84.3bn (Dh309.38bn) this year.
“Never before in the history of commercial aviation has our industry faced a challenge of this scale and magnitude,” Akbar Al Baker, Qatar Airways group chief executive, said in the company’s annual report. “We have yet to fully understand the long-term consequences of the virus upon our industry as a whole.”