Despite unarguably difficult times for the airline sector last year, the Emirates Group – comprising Emirates Airline, Dnata and their subsidiary companies – has posted a record profit increase of 248 per cent, posting a net profit for the financial year ended 31 March 2010 of AED 4.2 billion (US$ 1.1 billion).

“It has been an exceptional year of continued profitability against a backdrop of the worst global recession in generations,” said His Highness Sheikh Ahmed bin Saeed Al Maktoum, chairman and chief executive, Emirates Airline and Group.

“The first half of the financial year however, was extremely challenging as the world continued to grapple with the economic crisis. Our pioneering spirit and ability to adapt in adverse conditions helped us to push through this harsh economic climate with an extremely strong performance in the latter part of the year.”

Group revenue remained stable at AED 45.4 billion reflecting lower passenger and cargo yields offset by increased traffic. The group profit margin improved to 9.1 per cent from 2.6 per cent a year earlier. The group’s cash balance grew to AED 12.5 billion at the end of March, a notable improvement of 43.3 per cent or AED 3.8 billion against the previous year and is all the more remarkable considering this cash balance is after the carrier made some AED 3.4 billion in investments mainly in new aircraft, other aircraft related equipment and dedicated lounges.

Despite a 16.9 percent capacity increase during 2009-10 to 28,526 million ATKM (Available Tonne Kilometres), the Emirates’ operating costs in total decreased by 2.7 per cent compared with the previous year. Fuel costs in 2009-10 were significantly lower than the previous year by a notable AED 2.5 billion (US$ 691 million), accounting for 29.9 per cent of total operating costs, down from 35.2 per cent the previous year.

Dnata too managed the crisis well, posting a 20.9 per cent rise in net profit to reach AED 613 million while revenue remained stable with a marginal drop of 0.7 per cent to AED 3.2 billion.

In 2009-10, the airline’s passenger fleet expanded with the delivery of 15 new aircraft, four Airbus A380’s, 10 Boeing 777-300ERs and one Boeing 777 freighter. At the end of the financial year Emirates’ fleet reached 142 aircraft including four freighters. During the year Emirates became the largest Boeing 777 operator when it took delivery of its 78th B777 aircraft.

Clarifying an oft-repeated query about subsidies, Sheikh Ahmed said the group was “unsubsidised and wholly unprotected from foreign competition in our home market, thanks to Dubai’s open skies policy”.