Emirates repays over 70% of $4.8bn pandemic debt

November 15, 2024, 2:50 PM

Emirates took on $4.8bn in debt over the pandemic. Its deputy president and chief operations officer Adel Al Redha told AGBI that it has already paid back almost 70%

Airline received over AED32bn in pandemic support
Over half of money already repaid to ICD
Boeing delivery delay ‘challenging’

Dubai’s Emirates airline has already repaid billions of dollars of debt it raised during the pandemic, a senior official told AGBI.

The emirate’s flagship carrier raised AED17.5 billion ($4.8 billion) in debt during the pandemic, when the aviation industry was brought to its knees as planes were grounded globally by strict lockdown rules.

“I would say 70 percent of that is already paid,” Adel Al Redha, deputy president and chief operations officer of Emirates airline, said on the sidelines of the Bahrain International Airshow on Wednesday.

During the pandemic, Emirates also received AED14.85 billion from its parent company, the government-backed Investment Corporation of Dubai (ICD).

In its latest financial results, Emirates revealed that $544 million in dividends had been paid to ICD. Regular dividends have been paid since 2022.

Emirates airline recorded a post-tax profit of AED8.7 billion for the first half of the year, down 7 percent compared to the same period last year, with the drop attributed to the first time the carrier had to pay UAE corporate income tax.

Over the six months the company completed retrofits on eight aircraft as part of a $4 billion programme. To date, 40 aircraft have been retrofitted: 32 A380s and eight B777s.

The programme was necessitated by the delays in the delivery of Emirates’ 777X aircraft order from Boeing. It was announced last month that the delivery date, initially pencilled in for 2021, had been put back by a further year to 2026.

Boeing said the delay was a result of challenges encountered during programme development, a temporary suspension of flight testing and labour strikes.

Al Redha said of the delay in delivery: “Obviously, it does present us with a serious challenge,” and it had “held back the expansion of certain destinations”.

Emirates is scheduled to take delivery of the first of 65 A350 aircraft, mid-range and long-range, later this month, with the full quota due to be on board within three and a half to four years.

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On Friday, an Emirates spokesperson issued the following statement to AGBI: “As disclosed in our financial reports, Emirates received AED14.85 billion ($4.1 billion) as equity injection from our owners during the COVID-19 pandemic. Unlike debt, equity injections do not ‘come due’, and shareholders instead expect returns in the form of dividend.

“In our financial year 2022-23, Emirates returned to profit post-pandemic and resumed paying dividend to the Investment Corporation of Dubai (ICD). Since 2022-23, the Emirates Group has paid AED8.5 billion ($2.3 billion) in dividend.

“Separately, during the pandemic, Emirates raised a total of AED17.5 billion ($4.8 billion) from the market to meet our financial requirements. As of 30 September 2024, the outstanding debt raised during Covid 19 stands at AED4.6 billion, which will be settled as per current maturity dates ending 2032 or earlier subject to market conditions.”

* A version of this article was published on Thursday, 14 November. It was updated on Friday, 15 November to clarify that Adel Al Redha was referring to the AED17.5 billion in debt raised during the pandemic, not the AED14.85 billion in equity payments received from ICD.