Abu Dhabi’s Etihad Airways said Thursday it posted a $1.87 billion loss last year, hit by “one-off” impairments on aircraft and investments in troubled Alitalia and airberlin.
The government-owned carrier said total impairments amounted to $1.9 billion, including a $1.06 billion “charge on aircraft, reflecting lower market values and the early phase out of certain aircraft types.”
“There was also a $808 million charge on certain assets and financial exposures to equity partners, mainly related to Alitalia and airberlin,” the company said.
Old fuel-hedging contracts also hurt the carrier’s results, Etihad said, adding that their financial impact is expected to diminish this year.
“A culmination of factors contributed to the disappointing results for 2016,” said Mohamed al-Mazrouei, chairman of the board of Etihad Aviation group.
Launched in 2003, Etihad has expanded rapidly and bought minority stakes in carriers around the world as it increased its share of global travel along with larger Gulf rivals Emirates and Qatar Airways.
Etihad owns 49 percent of Alitalia, 29 percent of airberlin, 40 percent of Air Seychelles, 19.9 percent of Virgin Australia and a 24-percent stake in India’s Jet Airways. It also has a share in Air Serbia.
Alitalia went into administration in May after staff rejected job and salary cuts which management had proposed as a condition for injecting new funds under a two-billion-euro rescue plan for the loss-making Italian carrier.
Meanwhile, losses incurred by the German carrier airberlin over the past two years amounted to 1.2 billion euros ($1.4 billion).
Join GhanaStar.com to receive daily email alerts of breaking news in Ghana. GhanaStar.com is your source for all Ghana News. Get the latest Ghana news, breaking news, sports, politics, entertainment and more about Ghana, Africa and beyond.