Air Arabia approves payment of 10% cash dividend. Yield pressures ahead

Air Arabia announced the Board of Directors approved the payment of a cash dividend of 10% for 2009 at its third Annual General Meeting (Arabian Business, 23-Mar-2010). Chairman, Sheikh Abdullah bin Mohammed Al Thani, stated 2010 "remains uncertain" with pressure on yields increasing. The carrier reported 14.2% year-on-year increase in revenue to 536.9 million and a net profit of USD123.1 million (-11.4% year-on-year) for the 12 months ended 31-Dec-2009. Meanwhile, Air Arabia Egypt is expected to commence operations in 2H2010 - later than originally expected.

Air Arabia: "Last year represented serious challenges to the global aviation sector and led to the industry's highest loss ever. With pressure on yields increasing significantly due to continuous overcapacity and volatile oil prices associated with the world's financial crisis, the year 2010 remains uncertain. In 2010, Air Arabia will continue to focus on efficient low cost operations while utilising its assets as well as providing our customers with the most competitive fares, more destinations and best value for money services," Sheikh Abdullah bin Mohammed Al Thani, Chairman. Source: Arabian Business, 23-Mar-2010.