After years of heavy losses that date back to pre-pandemic, Etihad Airways has just reported a record profit for the first half of the year. Let’s take a look at the details.
In this post:
Etihad financial results for first half of 2022
Etihad Airways has reported a core operating profit of $296 million for the first half of 2022, which compares favorably to a $392 million loss during the same period in 2021. This is despite fuel costs having increased by almost 60% compared to the same period last year.
Let’s look at some of the key metrics comparing the first half of 2022 and the first half of 2021:
- Passenger revenue was $1.25 billion, compared to $320 million in 2021
- Cargo revenue was $800 million, compared to $760 million in 2021
- Operating revenue was $2.29 billion, compared to $1.23 billion in 2021
- Passengers carried were 4.02 million, compared to 980,000 in 2021
- Available seat kilometers were 24 billion, compared to 16.43 billion in 2021
- Seat load factor was 75%, compared to 25% in 2021
- 71 aircraft operated, compared to 64 in 2021
Now, admittedly the first half of 2021 was a very bad time for airlines, so that’s not exactly a valuable comparison to how things were pre-pandemic. However, pre-pandemic Etihad had some other major challenges, which I’ll get more into below.
I think it’s also interesting to note the highlights related to Etihad Guest during the six month period, as there are some impressive results there as well:
- Etihad Guest had a record new member acquisition in June 2022, increasing to 7.95 million members
- Flight redemptions increased 15% in the first half of 2021 compared to pre-pandemic levels in 2019
Now, when it comes to operating results of government-owned Middle Eastern airlines, I think there’s understandably always a level of skepticism. Can these results be trusted? I’d say yes, but perspective is important. Of course economics are a bit different when the government owns not just the airline, but also the airport, and on top of that has the ability to provide financing at a scale and at rates that other airlines may not have access to.
I do believe this profit is mostly “real” in relation to past results. However, the economics are definitely a bit different than they’d be in the rest of the world.
Etihad’s transformation is working (but it’s boring)
In the several years leading up to the pandemic, Etihad Airways lost around $6 billion. The airline was essentially lighting money on fire, until a new transformation plan was put into place.
Prior to the pandemic, Etihad engaged in possibly the worst airline investment strategy in history, in order to create the Etihad Airways Partners concept. The Abu Dhabi-based airline invest in airlines like airberlin (which liquidated), Alitalia (which was taken over by the Italian government), Jet Airways (which liquidated, but is coming back without Etihad involved), Air Serbia (which Etihad sold most of its stake in), Virgin Australia (which went through bankruptcy), and Air Seychelles (Etihad sold its 40% stake for $1).
Not only was there the Etihad Airways Partners strategy, but Etihad also planned to compete head-on with Emirates and Qatar in terms of its route network and fleet, and at one point Etihad had hundreds of planes on order.
For a long time the government of Abu Dhabi seemed to be onboard with this strategy… but then it wasn’t. The airline has since undergone a major transformation, which has included scrapping the ridiculous Etihad Airways Partners concept, canceling all kinds of aircraft orders, retiring A380s, and more.
Etihad is now focused on being lean and profitable, rather than being big and sexy. In a way, current CEO Tony Douglas has taken exactly the opposite approach of what former CEO James Hogan took. Admittedly both of their plans probably reflect the wishes of the government.
As customers, I think we all miss the sexiness and intrigue of the “old” Etihad. But you also can’t blame the airline for not wanting to lose billions.
Bottom line
Etihad Airways has reported a record half year profit for the first half of 2022. Admittedly this has been a pretty good time for the airline industry, but much more significantly, it reflects Etihad’s overall transformation. Unlike most other airlines, Etihad was losing billions even pre-pandemic.
While Etihad isn’t nearly as intriguing of an airline as it used to be, I’m happy to see that the carrier is more sustainable.
What do you make of Etihad’s financial results, and overall transformation?
We have flown 6 times in the 1st class Appartments. We were very fortunate to experience the wonderful level of comfort and service in there A380.
Thank you Etihad for the ride. Will never forget.
Let’s hope we can enjoy the Business Class in future plane fleet.
Etihad airways always up in the world always reminds in pray
Allah bless for Etihad airways
Thanks to Etihad airways
I just flew seat 2K on EY131 AUD IAD Monday. Wonderful product, tasty food excellent FAs, Pateri, Christina, & Margo. Beautiful end to my Birthday RTW
Having flown with them recently I only have great things to say about them - All flights were full in premium and the product exemplary- I hope that they continue on their upward journey
Disagree with you entirely. Etihad is no longer just an airline. With the inclusion of the multiple logistics, infrastructure, tourism and airport services, Etihad is now an umbrella for the gateway to Abu Dhabi. If anything, the company has grown despite a narrowing of its fleet and airline operations. A significant chunk of its profit came due its effective cargo and logistics operations.
I do like their solid soft and hard product in business class and haven’t had any notable unpleasant experience with them. Guess, I’m not posh enough to see all the “drama” surrounding Etihad’s development.
They did not have a good record with forming an airline alliance group.
They should have joined one of the major groups.
In accounting there is no such thing as core operating profit. This is a made up term which stripa out a lot of oosts which may or may not be one time.
One of the most disgusting airline I’ve ever travelled with, I would never ever suggest anyone to book their flight with etihad. Its total ripoff, I travelled with them back in November 2021 and they lost my baggage and its been 9 months I haven’t got any reimbursement even though it clearly says on their website that if we are unable to find your baggage for 21 days we will pay you for that but...
One of the most disgusting airline I’ve ever travelled with, I would never ever suggest anyone to book their flight with etihad. Its total ripoff, I travelled with them back in November 2021 and they lost my baggage and its been 9 months I haven’t got any reimbursement even though it clearly says on their website that if we are unable to find your baggage for 21 days we will pay you for that but its so sad that I haven’t got a single penny. I went to india for my wedding and my whole wedding stuff was in that bag. So please don’t waste your money and time its my request to everyone Their customer service is so unprofessional if you call them they will just say that we can send an email to the head office but we can’t provide you any email as its confidential, they don’t have any email where you can directly contact them.
That's basically very airline these days, lol. Welcome to the "new normal."
After that length of time your Travel Insurance kicks in, yes?
Have you maybe considered it could just be the Indian airport handlers? One bad experience does not equate to being a bad airline, this sort of thing isn't unique to any single airline. Stick to Air Kaneda if you hate it so much, Lovepreet :)
You forgot Etihad Regional, which was actually Darwin Airlines. It was a weird airline. I flew them in 2014. Sad that they are gone. Here is my trip report: https://www.flyertalk.com/forum/trip-reports/1624233-etihad-regional-cdg-lej-ams.html
Yes they made a profit but robbing us, I will never travel with them again.
They just wouldn't let me travel on the specified day coz they wanted to make money. They would not rebook me.
A bunch of thieves.
The Etihad Partners strategy wasn’t the issue - in other circumstances that would work very well. The problem was the specific airlines they invested into, no doubt in part because they invested into so many airlines so quickly, picking up whatever was available (often not great choices) rather than patiently waiting for good deals (read: good airlines) to come along. It’s a shame. The plan was good, but the execution was poor.
It'd almost be excusable were it not a repeat of all the same mistakes that Swissair made 20yrs prior.
A blind person could've seen how badly those partners were going to work out, but EY just trudged ahead anyway....
I'm really perplexed as to your comments lately on Etihad. You even called them a LCC two weeks ago. My flights with them as of late have been really wonderful. As an example they have a much superior and consistent J product compared to EK. Pre Clearance in AUH is great and the lounges are more than comfortable. No, the few F cabins left certainly do not have the wow factor of EK, but it's...
I'm really perplexed as to your comments lately on Etihad. You even called them a LCC two weeks ago. My flights with them as of late have been really wonderful. As an example they have a much superior and consistent J product compared to EK. Pre Clearance in AUH is great and the lounges are more than comfortable. No, the few F cabins left certainly do not have the wow factor of EK, but it's still a great product with private suites and fantastic dine on demand food.
Sure, they were far more bling when they had Residence/Apartments on A380's. But they are far from being Fly Dubai level now. I also love their redemptions on Aeroplan.
I think that's because of their new stringent economy hand luggage allowance, even so they are far from a LCC.
One of the holding companies of the Abu Dhabi Government (ADQ) bought out some of Etihad's subsidiaries and sister companies last year. I wonder how that fits into the profits this year, could a large part of the profits be attributed to that?
Source for context:
https://www.google.com/amp/s/www.thenationalnews.com/business/aviation/2021/12/23/adq-to-fold-etihads-support-services-into-its-new-aviation-holding-company/%3foutputType=amp