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Etihad...highest rating

Etihad welcomes 'A' rating by Fitch

ABU DHABI, June 3, 2015

Etihad Airways, the national carrier of the UAE, has been assigned the rating of ‘A’ with a Stable Outlook, by Fitch Ratings, a leading credit ratings agencies.

Fitch Ratings issued the Long-term Issuer Default Rating (IDR) following a detailed independent analysis of Etihad Airways’ business, its commercial performance and its equity alliance strategy.  

James Hogan, president and chief executive officer of Etihad Airways, said: “The Fitch A rating is further independent recognition of the strength of this business and of our strategy.”

In the rating, Fitch states that the airline has managed to establish a global network with the scale and depth similar to that of its more established European and Gulf peers despite being relatively young. One of the key advantages pointed out was the geographic location of its hub in proximity to the fast-growing travel markets of Asia, Middle East and Africa as well as the US pre-clearance at its Abu Dhabi hub, shorter connecting time and greater domestic access to key markets such as Europe and India, through its airline partnerships.

The Fitch rating recognises that Etihad Airways is in a good position to deliver increasing profitability with the carrier having recently reported revenues of $ 7.6 billion and net profits of $73 million for 2014, marking its fourth consecutive year of profitability.

“We have a clear mandate from our shareholder to deliver long-term, sustainable profitability. Our organic growth, boosted by our minority equity investment model, is increasingly being recognised as a highly effective strategy to deliver that return,” Hogan said.

“We have already raised more than $11 billion to support our growth, from more than 80 financial institutions around the world. We raise that finance on commercial terms, with no sovereign guarantees or letters of comfort,” he noted.

The ratings also highlighted that having reached scalability, Etihad plans to increase its focus on profitability and cost management through network management, fleet optimisation and higher fleet utilisation. Moreover, the cooperation with equity airline partners may also bring in synergies and cost savings on joint fleet orders, joint procurement (eg ground handling, catering, fuel, etc) and aircraft maintenance and joint staff training, among other things, it said.

“The A rating also supports Etihad Airways’ strategy of fast-paced organic growth and establishing minority equity investments in key strategic partners around the world. These are delivering significant benefits, with our Etihad Partners delivering new revenues as well as major business synergies,” he said. – TradeArabia News Service




Tags: Etihad | Rating | Fitch |

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