Qatar Airways made a “substantial” loss in its last financial year because of a regional dispute that has banned the airline from four Arab countries, its chief executive said on Wednesday without revealing the extent of the losses.
Qatar Airways has been banned from flying to 18 cities in Saudi Arabia, the United Arab Emirates, Bahrain and Egypt since June 2017, with each of the four countries breaking-off ties with Qatar because of Doha's support for terrorist organizations.
“We have increased our operating costs. We had to also take a hit on revenues so we don’t think that our results for the last financial year will be very good,” Chief Executive Akbar al-Baker told reporters at the Eurasia Airshow in Antalya, Turkey, according to Reuters.
“I don’t want to say the size of the loss but it was substantial.”
Other activities the airliner carries out had made a profit, although not enough to offset the impact of the company's losses.
Qatar Airways has several subsidiary units, including food and beverage services and ground floor services at airports.
The state-owned airline will need another eight weeks to finalise its books and make adjustments before it announces its financial results for the year to March 31, Baker said. The airline had warned of the loss for several months.
Following the Doha boycott and the Qatar Airways ban, the airline was forced to fly longer on many routes west and south of Qatar, increasing fuel consumption.
That has forced the airline to fly longer flights on many routes to the west and south of Qatar which requires more fuel and increases costs.
Qatar Airways has no immediate plans to ask its sole shareholder, the government of Qatar, for a capital injection but may do so if the airspace ban continues and there is pressure on its debt equity ratio, Baker said.
