Middle East Airlines to Reach Profits of $1.5 billion in 2013


Middle East Airlines are expected to report higher profits this year, according to IATA’s latest report. Carriers in the region are predicted to make a total of $1.5 billion. This estimate is rosier compared to the previous, which pointed that the figure will be equal to only $1.4 billion.

Read more: Dubai passenger traffic increased by 16.3% to 21.9 million year to date

From IATA researchers explain that the reason for this change in the forecast is mainly the strong passenger demand. Moreover, it is predicted to continue to rise and it may surpass the initial estimate of 12.6% and reach 15%.

According to the report, the Middle East is one of the most successful and important traffic hubs. That is because the region connects a number of developing countries with emerging economies located in Africa and Asia.

Passenger capacity in the Middle East will probably continue its rise registered since 2011. It is predicted that this year it will hit 12.6% which is an increase with nearly 4% compared to two years ago. ME passenger traffic will also follow a similar tendency.

Not only ME carriers and airline industry enjoy good forecasts. IATA predicts that every region will see higher profits this year. Nevertheless, some of them will experience more modest growth.

On a global level, the sector is expected to witness profits of $12.7 billion. That is $2.1 billion more compared to the previous prognosis. IATE explains that the rise in the figures here is due to the cost reductions, as well as the lower oil prices.

However, some regions, like Europe, for example will have difficulties balancing the profits with the costs. Airlines will make around $4 for each passenger. That is quite worrying since this it is obviously still too low.

Luckily, profits are not expected to reach critical levels because of the increased number of additional revenues and passengers. It is predicted that carriers will enjoy a record amount of passengers in 2013 – 3.13 billion. In addition, they will break a record in terms of filled seats – 80.3%.

The additional revenues of airlines, on the other hand, will increase by 5% reaching $36 billion. The cause for that are the extra services offered by carriers, involving seats, meals and baggage.

The least powerful and stable region is predicted to continue to be Africa. There, carriers will make a profit of barely $100 million. According IATA, this is caused by the passengers’ safety concerns. In comparison, Latin America is expected to make profits of 600 million in 2013, while Europe has the potential of reaching $1.6 million of profits.


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