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Air Arabia delivers record 2022 net profit of $327 mln, up 70 pct


Air Arabia, the first and largest low-cost carrier (LCC) operator in the Middle East and North Africa, announced historic financial results for the full year ending December 31, 2022, almost doubling the profit and passengers’ numbers of the previous year, as the airline continued with its growth plans, delivering remarkable financial and operational performance.
Air Arabia reported a net profit of $327 million (Dh 1.2 billion) for the full year ending December 31, 2022, an increase of 70 per cent compared to Dh 720 million registered for the full year 2021. The airline turnover for the full year 2022 reached Dh 5.2 billion, an increase of 65 per cent compared to Dh 3.2 billion registered for the full year 2021.

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The financial and operational results achieved in 2022 were strongly supported by the growth in passenger numbers that exceeded pre-pandemic levels.
Air Arabia served more than 12.8 million passengers in 2022 from its seven hubs in the UAE, Morocco, Egypt, Armenia, and Pakistan, an increase of 90 per cent compared to 6.8 million passengers carried in 2021. The average seat load factor – or passengers carried as a percentage of available seats – for the full year stood at a high 80 per cent.

Commenting on the results, Sheikh Abdullah Bin Mohammad Al Thani, Chairman of Air Arabia, said: “Air Arabia’s 2022 record profitability is considered the best in the company’s operating history. The remarkable operational and financial performance reflect the carrier’s robust business model, its management team, as well as its discerning growth strategy. Although the year 2022 continued be challenging, the aviation industry has begun returning to normality as airlines and airports worldwide witnessed faster recovery following the drop in demand cause by the pandemic.”
He continued: “Air Arabia Group maintained its robust growth in 2022 by increasing its fleet size and adding new routes across its global network while launching the operations of its latest joint venture airlines in Armenia and Pakistan. We are proud that Air Arabia’s value-driven product and services now reaches a wider and fast-growing customer base spread across key regional markets.”
In the fourth quarter ending December 31, 2022, Air Arabia reported a net profit of Dh 356 million, 24 per cent less than the Dh 467 million registered in the same quarter last year, which witnessed record high yield margins and lower fuel prices. The turnover for the last quarter 2022 reached Dh 1.4 billion, an increase of 7 per cent compared to the same quarter last year. Air Arabia carried more than 3.6 million passengers from its seven hubs in the fourth quarter, an increase of 44 percent compared to 2.5 million passengers carried in the same period last year. The average seat load factor for the same period stood at impressive 79 per cent, reflecting the stable recovery witnessed in demand for air travel.
Al Thani added: “The solid fourth quarter and full year results were supported by the carrier’s cost control measures, strong yield margins and higher demand for its value-driven product. We remain committed to proving our customers with the best travel deals while continuously investing in growth and product innovation.”
Air Arabia added 24 new routes to its global network in 2022 from its operating hubs in the UAE, Morocco, Egypt, Armenia, and Pakistan. The carrier took delivery of 10 new aircraft and ended the year with a fleet of 68 Airbus A320 and A321 aircraft operating to over 190 routes across the Middle East, Africa, Asia, and Europe.
Air Arabia Group has also launched operations of its latest joint ventures airlines in Armenia and Pakistan.
In June, ‘Fly Arna,’ Armenia’s National Airline, started its operations from its base in Yerevan and continued to expand its network by adding five new routes; while ‘Fly Jinnah,’ Pakistan new low-cost carrier, started its operations in October and added 4 domestic destinations.

Air Arabia Group along with DAL Group signed an agreement to form ‘Air Arabia Sudan,’ a joint venture company that will be based in Khartoum. The new airline will follow the same low-cost business model providing its customer base with a reliable operation and value-driven product.
Al Thani concluded: “While airlines continue navigating various challenges this year, we are confident of the fundamentals of the aviation sector and the underlying demand for affordable air travel. Air Arabia continues to drive its business by a clear strategy for growth and supported by its commitment to continuously maximize value offering to its customers and shareholders.”
In October, Air Arabia celebrated 19 years of successful operations which transformed the air travel industry in the wider MENA region.

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Business

Abu Dhabi Overtakes Oslo for Sovereign Wealth Fund Capital in Global SWF’s First City Ranking

Today, industry specialist Global SWF published a special report announcing a new global ranking of cities according to the capital managed by their Sovereign Wealth Funds (SWFs). The findings show that Abu Dhabi is the leading city that manages the most SWF capital globally, thanks to the US$ 1.7 trillion in assets managed by its various SWFs headquartered in the capital of the UAE. These include the Abu Dhabi Investment Authority (ADIA), Mubadala Investment Company (MIC), Abu Dhabi Developmental
Holding Company (ADQ), and the Emirates Investment Authority (EIA). Abu Dhabi now ranks slightly above Oslo, home to the world’s largest SWF, the Government Pension Fund (GPF), which manages over US$ 1.6 trillion in assets. Abu Dhabi and Oslo are followed by Beijing (headquarters of the China Investment Corporation), Singapore (with GIC Private and Temasek Holdings), Riyadh (home to the
Public Investment Fund), and Hong Kong (where China’s second SWF, SAFE
Investment Corporation, operates from). Together, these six cities represent two thirds
of the capital managed by SWFs globally, i.e., US$ 12.5 trillion as of October 1, 2024.
For the past few decades, Abu Dhabi has grown an impressive portfolio of institutional
investors, which are among the world’s largest and most active dealmakers. In addition
to its SWFs, the emirate is home to several other asset owners, including central banks,
pension funds, and family offices linked to member of the Royal Family. Altogether, Abu
Dhabi’s public capital is estimated at US$ 2.3 trillion and is projected to reach US$ 3.4
trillion by 2030, according to Global SWF estimates.
Abu Dhabi, often referred to as the “Capital of Capital,” also leads when it comes to
human capital i.e., the number of personnel employed by SWFs of that jurisdiction, with
3,107 staff working for funds based in the city.
Diego López, Founder and Managing Director of Global SWF, said: “The world ranking
confirms the concentration of Sovereign Wealth Funds in a select number of cities,
underscoring the significance of these financial hubs on the global stage. This report
offers valuable insights into the landscape of SWF-managed capital and shows how it is
shifting and expanding in certain cities in the world.”

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AM Best Briefing in Dubai to Explore State of MENA Insurance Markets; Panel to Feature CEOs From Leading UAE Insurance Companies

AM Best will host a briefing focused on the insurance markets of the Middle East and North Africa (MENA) on 20 November 2024, at Kempinski Central Avenue in Dubai.
At this annual regional market event, senior AM Best analysts and leading executives
from the (re)insurance industry will discuss recent developments in the MENA region’s
markets and anticipate their implications in the short-to-medium term. Included in the
programme will be a panel of chief executive officers at key insurance companies in the
United Arab Emirates: Abdellatif Abuqurah of Dubai Insurance; Jason Light of Emirates
Insurance; Charalampos Mylonas (Haris) of Abu Dhabi National Insurance Company
(ADNIC); and Dr. Ali Abdul Zahra of National General Insurance (NGI).
Shivash Bhagaloo, managing partner of Lux Actuaries & Consultants, will his present
his observations in an additional session regarding implementation of IFRS 17 in the
region. The event also will highlight the state of the global and MENA region
reinsurance sectors, as well as a talk on insurance ramifications stemming from the
major United Arab Emirates floods of April 2024. The programme will be followed by a
networking lunch.
Registration for the market briefing, which will take place in the Diamond Ballroom at the
Kempinski hotel, begins at 9:00 a.m. GST with introductory comments at 9:30 a.m.
Please visit www.ambest.com/conference/IMBMENA2024 for more information or to
register.
AM Best is a global credit rating agency, news publisher and data analytics
provider specialising in the insurance industry. Headquartered in the United
States, the company does business in over 100 countries with regional offices in
London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City.

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Future of Automotive Mobility 2024: UAE Leads the Charge in Embracing Digital Car Purchases and Alternative Drivetrains

-UAE scores show highest percentage among the region in willingness to purchase a car
completely online
– Openness to fully autonomous cars has grown to 60% vs previous 32%.
– More than half of UAE respondents in the survey intend to move to hybrid cars during
next car purchase, while less than 15% intend to move to fully electric car.
– UAE sees strong use of new mobility services such as ride-hailing (Uber, Careem, Hala
Taxi)
– The perceived future importance of having a car is not only increasing in UAE but is
higher than any other major region globally, even China

Arthur D. Little (ADL) has released the fourth edition of its influential Future of Automotive Mobility (FOAM) report, presenting a detailed analysis of current and future trends in the automotive industry. This year’s study, with insights from over 16,000 respondents across 25 countries, includes a comprehensive focus on the United Arab Emirates (UAE). The report examines car ownership, electric vehicles,
autonomous driving, and new mobility services within the UAE.

“The UAE is at the forefront of automotive innovation and consumer readiness for new mobility
solutions,” said Alan Martinovich, Partner and Head of Automotive Practice in the Middle East
and India at Arthur D. Little. “Our findings highlight the UAE’s significant interest in
transitioning to electric vehicles, favorable attitudes towards autonomous driving technologies,
and a strong inclination towards digital transactions in car purchases. These insights are critical
for automotive manufacturers and policymakers navigating the evolving landscape of the UAE
automotive market.”
Key Findings for the UAE:
1. Car Ownership:
o Over half of UAE respondents perceive that the importance of owning a car is
increasing, with the study showing the increase higher than any other major
region, including China.
o Approximately 80% of UAE respondents expressed interest in buying new (as
opposed to used) cars, above Europe and the USA which have mature used
vehicle markets

2. Shift to Electric and Hybrid Vehicles:
o While a high number of UAE respondents currently own internal combustion
engine (ICE) vehicles, more than half intend that their next vehicle have an
alternative powertrain, with significant interest in electric and plug-in hybrid
(PHEV) options. Less than 15% plan to opt for pure battery electric vehicles
(BEVs).

3. Emerging Mobility Trends:

o Ride-hailing services are the most popular new mobility option among UAE
residents, with higher usage rates than traditional car sharing and ride sharing.
The study indicates a strong openness to switching to alternative transport modes
given the quality and service levels available today.

4. Autonomous Vehicles:
o UAE consumers are among the most open globally to adopting autonomous
vehicles, with a significant increase in favorable attitudes from 32% in previous
years to 60% this year versus approximately 30% in mature markets. Safety
concerns, both human and machine-related, remain the primary obstacles to
broader adoption.

5. Car Purchasing Behavior and Sustainability:
o The internet has become a dominant channel for UAE residents throughout the car
buying process, from finding the right vehicle to arranging test drives and closing
deals. UAE car buyers visit dealerships an average of 3.9 times before making a
purchase, higher than any other region in the world, emphasizing the need for
efficient integration of online and offline experiences.
o Upwards of 53% of respondents from the region would prefer to ‘close the deal’
and complete the purchase of their car online, which is the highest for any region
in the world.
o Sustainability is a key factor cited by UAE consumers as influencing car choice.
The UAE scored among the top half of regions, highlighting the importance of
environmental considerations.

“Our study confirms the promising market opportunities for car manufacturers (OEMs) and
distributors in the UAE” commented Philipp Seidel, Principal at Arthur D. Little and co-Author
of the Global Study. “Consumers in the Emirates show a great and increasing appetite for cars
while being among the most demanding globally when it comes to latest vehicle technologies
and a seamless purchase and service experience.”
The comprehensive report, “The Future of Automotive Mobility 2024” by Richard Parkin and
Philipp Seidel, delves into global automotive trends and their impact on various regions,
including the UAE. This study is an invaluable tool for industry stakeholders seeking to navigate
and leverage the dynamic changes driving the future of mobility.

 

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