Etihad Airways group chief govt Tony Douglas believes the restructured UAE service remains to be on observe to fulfill its authentic goal of returning to revenue in 2023, regardless of the adverse affect of the pandemic.
The Abu Dhabi-based service immediately disclosed a core working lack of $476 million for 2021, chopping losses from the $1.7 billion it incurred within the pandemic-hit 2020.
“I feel you’ll observe many aviation commentators and analysts [being] of the view that this illustrates important progress on that transformation journey,” Douglas tells FlightGlobal, as a part of wide-ranging interview in Abu Dhabi immediately.
“In easy phrases it’s a 41% enchancment on 2019 – ie pre-pandemic numbers – and it’s a $1 billion enchancment on EBITDA.”
Douglas has overseen a serious restructuring of the service since taking the helm in late 2017, after losses spiralled when the group’s formidable equity-alliance technique unwound. He says the unique goal earlier than the pandemic was for a return to the black in 2023.
“In some methods we’re in all probability now forward of schedule of what was the unique plan,” he says. ”We’re on for 2023; I’d prefer to suppose it [will be] earlier in 2023 [rather] than later in it.
”I feel the EBITDA quantity particularly – EBITDA is a proxy for future free cash-flow and to have a $1 billion swing to a constructive within the mid-$400 [millions] – is one thing that offers us confidence that we are able to ship on that ambition.”
He believes that the restructuring already below means on the service has helped it deal with the adverse affect of the pandemic. “Shedding numerous the mass we had traditionally means we’re much more agile than we have been previously, and on account of this, I feel these outcomes communicate for themselves,” he says.
Cargo actions generated revenues of $1.7 billion throughout 2021, accounting for greater than half the group’s $3.1 billion revenues for the yr.
“Cargo has been a life-saver – for all of us, not simply Etihad,” says Douglas ”Our cargo efficiency in 2021 was a 73% improve and the market not solely continued to see development in yield, but additionally in quantity.”
He describes the airline’s passenger enterprise efficiency in 2021 as a “recreation of two halves”. Etihad carried 1 million passengers over the primary half. This jumped to 2.5 million over the second half of the yr.
“[We] had load components in Q1 at 25%, Q2 early 30s,” Douglas says, noting demand picked up round September as journey restrictions within the UAE started easing. “We ended up with the load components [around] 70% fairly rapidly.”
Douglas says momentum in passenger bookings has continued to this point this yr, as different key markets – for instance Australia – have begun to reopen. Abu Dhabi additionally on the finish of February additional eased restrictions for vaccinated travellers.
“It has all began to normalise out a bit now,” he says. “Fingers crossed [with Covid] there may be nothing that’s going to comply with that’s going to have the form of affect we noticed final yr. I feel there may be optimism round.”
Likewise he’s upbeat on continued sturdy cargo demand. “A lot of the analysts are of the opinion that cargo yields will look ahead to at the very least one other yr and I don’t see any easing off in volumes.” Douglas says.
Nonetheless, he does flag considerations over the potential of the Ukraine battle to affect the broader aviation sector. Notably oil costs have jumped additional because the Russian invasion of Ukraine and the barrel value of Brent crude oil has now handed the $100 mark for the primary time since 2014.