Qatar Airways reported record losses for the fiscal year endng March 31, blaming higher fuel costs and currency volatility, amid an ongoing boycott by Arab countries restricting its flights.
The state-owned carrier widened its net loss to 2.3 billion Qatari riyals (Dh2.32bn), compared to 252.5 million Qatari riyals a year earlier, Qatar Airways said in a statement on Wednesday. The nearly ten-fold rise in annual losses outpaced the 14 per cent increase in full-year revenues of 48 billion riyals.
The Doha-based carrier faced a "challenging year" and the "disappointing" financial results are attributable to "the loss of mature routes, higher fuel costs and foreign exchange fluctuations," Akbar Al Baker, Qatar Airways Group chief executive, said.
Qatar Airways is grappling with a two-year boycott by Saudi Arabia, UAE, Bahrain and Egypt, who severed economic ties with the Gulf state in June 2017. The dispute resulted in airspace closures over the four countries for Qatar Airways, forcing it to slash 20 routes and take longer flight diversions, which increased fuel costs and flight times.
The carrier’s losses were widened by a slowing global economy and geopolitical tensions between Iran and the US.
Al Baker said that "in the face of adversity," the airline still added 11 new destinations, boosted the number of passengers carried, added 25 new aircraft to the fleet and grew its cargo business to the largest in the world.
During the fiscal year, Qatar Airways acquired a five percent stake in China Southern Airlines, giving it access to the fast-growing Chinese market and adding to its existing investments in global airlines. It has minority stakes in Air Italy, Hong Kong's Cathay Pacific, British Airways' parent IAG, and South America's LatAm.Al Baker added he was optimistic about the current fiscal year as the airline's underlying fundamentals remain "extremely robust."