Category Archives: emirates

Emirates Airlines, 30th Year of Profit

In its recently released annual reports, Emirates Group had revenue of US$ 27.2 billion, and it’s 30th straight year of profits at $1.1 billion and will pay $545 million as a dividend to the Dubai Investment Corporation.

Emirates Airlines revenue increased 9% to US$ 25.2 billion, while its profit increased to $762 million and this was attributed to strong performance in cargo which offset fuel price increases of 15% during the year. Fuel now accounts for 28% of their operating costs, while staff expenses are 15%. The Emirates Group has 80 subsidiaries and 103,000 employees, a number which declined by 2% in the year. The report notes that there was a 2.2% reduction in flight handled at Dubai’s two airports due to termination of flights between Dubai and Qatar, from the, still ongoing, dispute with Qatar.

Emirates carried 58.5 million passengers and received 17 new aircraft, in the year taking its fleet to 268. It is the world’s largest operator of the Boeing 777 and A380 planes and announced new orders for 36 A380’s and 40 B787-10’s. Emirates revenue was from six regions topped by Europe with $7.3 billion revenue, followed by East Asia/Australasia $6.9 billion, the Americas $3.7 billion, and revenue from African routes was $2.6 billion (an increase 8%).  In Africa, they fly to 27 destinations and the report notes that their results in Africa were achieved in spite of political instability and currency volatility including massive devaluation in some countries. Revenue from the Gulf & Middle East was $2.3 billion, and West Asia/ Indian Ocean was $2.1 billion. During the year Emirates signed partnerships with Fly Dubai and Cargo Lux and extend one with Qantas.

Emirates SkyCargo revenue was US$ 3.4 billion (14% of the airline’s revenue) from its freighter fleet of 13 777’s, while Emirates’ hotel’s revenue was US$ 203 million, Emirates also tested the use of blockchain to streamline cargo delivery, digitize their supply chain and eliminate paper usage.

Dnata, a separate entity in the Emirates Group, had its best year yet with $3.6 billion of revenue and $359 million profit. Dnata serves 300 airlines in 35 countries and its international business which included handling 3. 8 million tons of cargo and serving 55 million meals during the year, now accounts for 68% of its revenue. Dnata acquired AirLogistics in the US, signed deals to do ground handling in New York,  and maintenance in Singapore and had other expansions in Europe while creating two new travel reservation systems.

Leaner, Fitter KQ at 40

Kenya Airways (KQ) just released their quarter three operational  results for December 31 (2016). Continuing on the restructuring changes that came after they announced their last financial results, theThe fleet and seats available for sale was 3% smaller as a result of off-loading idle aircraft from the fleet, through sale of Boeing 777s, and leases and returns of others.

Despite the smaller fleet, KQ flew 1.1 million passengers in the quarter, almost 5% more than last year with a cabin factor of 72% up from 68%. The passengers were on routes in Europe (102,749), Middle East & Far East (138,700), Africa (530,842) and within Kenya (347,136)

KQ increased the number of flights in Africa, while reducing capacity on others as a result of  using Boeing 787s and Boeing 737s on the Middle East, China and India routes that were previously served with Boeing 777s. They added routes to Cape Town, as well as others on the Nairobi-Entebbe-Bangui and Nairobi-Doula- Bangui but suspended flights to Gaborone and Abuja.

KQ’s financial year-end is on March 31, 2017 and they are currently celebrating their 40th anniversary with a 40% fare sale on all routes, and with special fares in business class, marking their beginning in the year 1977. They also just announced an interline cargo agreement with Qantas through which they target to fly 30 tonnes of flowers per month to Australia, as they explore shipping even more flowers to China and the Far East

Last week also saw Kenya Airways largest shareholder, the Government of Kenya, flex its muscle by canceling a third Emirates daily flight into Nairobi that was to begin in June 2017. Emirates currently flies Boeing 777s twice daily between Nairobi and Dubai.

Kenya – Dubai: Fresh Exports & Chamber Commerce Trade

There’s a delegation from the Dubai Chamber of Commerce & Industry in Nairobi this week and they were hosted by the Kenya National Chamber of Commerce and Industry (KNCCI). The Dubai Chamber announced that they will open a representative office in Nairobi, their fourth in Africa, after Addis, Accra, and Maputo – to do market research, discover opportunities for partnership and value addition, support Dubai businesses in Kenya and give Kenyans information about business opportunities in Dubai.

dubai-flag

Kiprono Kittony said Kenya imports about $900 million from Dubai and exports about $300 million. He said that some challenges of business in Kenya include double taxation between the counties, infrastructure to the counties, corruption, but that he saw endless trade opportunities for their 14,000 members in 45 counties.

Naushad Merali said that when he first went to Dubai in 1982, it was smaller than Mombasa, but it had since transformed, thanks to Sheikh Mohammed’s leadership.  He said Kenya was one country with a stable currency and Dubai investors would not have to worry about moving money in and out the country – and that while manufacturing was difficult due to dumping from Asia, the advantage was if you were doing agro-business, especially of things that are grown here. A Stanbic bank executive said they were the largest bank in Africa said they were ready to finance projects in infrastructure energy, renewable energy, tourism, electricity transmission etc. – and that while banks are able to do projects of $25 – $ 60 million, with larger than $100 – $200 million, ones there was need to syndicate across borders.

bananas-for-dubai

Hot button issue. Kittony also spoke of Kenyan flowers that go to Amsterdam and then get re-shipped to Dubai. He added that Kenya had developed a disease-free livestock belt that could export to Dubai and the Gulf states (GCC). Someone else said that there are only 5 Kenyan fresh products on Dubai supermarket shelves (including mango and avocado) out of a potential 70 others, and lots of fresh stuff is sent to Europe where it is repacked and relabeled before being shipped to Dubai. While someone else said the lack warehouses and charter flights from Mombasa and Eldoret were the problem, another said that there were 14 Emirates flights a week, along with others from Kenya Airways and Etihad (and Qatar) – so flights were not the problem. Another said that Kenya had simply not marketed itself fully to Dubai in terms of what it could produce and export and get to Dubai via a 4 hours flight or a 12-day ship ride. Kiprono later lamented that flights flew into Eldoret, full of cargo, and flew out largely empty – while they could carry flowers, coffee, bamboo and other things.

Twitter Week Top 10 December 22

Twitter is a micro-blogging tool that is really nifty for doing mini-posts, forwards and other remarks that (are on any subject) and are maybe not worthy of a full blog post. Here’s a summary of my week on Twitter in a Dave Letterman top 10 format covering tech events, new planes, sluggish car sales, strange naiorbians and other topics

10 Mainstream Blogging: #F1 blogger quits work to blog full time-best wishes @f1fanatic_co_uk! http://tinyurl.com/yegm5l3
– Great reads: the 75 best business-blogs of 2009 http://www.businesspundit.com/the-75-best-business-blogs-of-2009/ includes @emeka_okafor

9. Tech Nairobi @whiteafrican is live blogging from @AfricaGathering today, refresh this post for the latest: http://bit.ly/75WgJ3 #agathering #agnairobi09
– Look out for @afromusing’s guide to buying solar gadgets.(via @sciculturist) <-----it's about time! #giftsforocha
– Stealth Startups, Get Over Yourselves: Nobody Cares About Your Secrets http://goo.gl/fb/hLw6 (via @rafiq)
– R/t: on the @ushahidi blog – 3 misconceptions about #ushahidi

idle castle brew facility

8. Brew Chatter SA giant beer brewer SAB considering re-entering kenya market after Deal with EABL in tanzania sours (Via @Nairobi star)
– konyagi vs waragi http://chickabouttown.com/2009/12/20/konyagi-vs-uganda-waragi/

7. GoK Absurdities 1. We dont accept sealed letters for PS, unless you have delivery book 2.This gate is locked between 9am and 4pm
– Harambee house is a corruption free zone, @SupremeGREAM – and so is a police roadblock #nyayohouse
– So new Police comm. Iteere got the 3rd class Moran/Golden Heart of Kenya; but so did Pauline & Ida
– Labour leader Atwoli sermons on #citizentv opposes privatization of #nationalbank #KCB #newKCC and kenya ports authority

6. Plane Chatter– know everything about today’s maiden boeing 787 flight (weather permitting) http://tinyurl.com/yewg5pl (via @flightblogger)
– 787 has taken off, take that copenhagen. R/t @coldtusker #787 is supposed to have a lower carbon footprint so supports #Copenhagen goals
– via @FlyingEmirates a Kenyan wins Emirates A380 dream prize (to Bangkok, Sydney or Seoul ) <----i'm so jealous! http://bit.ly/8yKvNA
– @coldtusker @alykhansatchu crown will fight to keep emirates independent as long as it can (perhaps pare down new plane buys to do so)
– #onejetone among airlines appying for licenses again – mombasa, harare, london
4:43 PM Dec 18th from web

5. Investor Awareness – ICT Kenya board tender for digitization of court records http://www.ict.go.ke/images/pdfs/6593719R_2.pdf @kenyanpundit
– Securities Industry Training Institute launched in Uganda-progs on capital markets,corp.fin, asset-mgmt, entrepreneurship, corp.govnance etc
– Send Nairobi Stock Exchange complaints by SMS to 8485, cost 10/= (also to receive) http://www.nsecomplaints.co.ke/ (via @NSEKenya)
– r/t @alykhansatchu Kenya Economic Update 2009 from the World Bank http://bit.ly/90sYCp simply definitive and full of Data that will surprise
– On CitizenTV ‘how to be rich’ is a golden dream prod .i.e @alfredmutua – they had ad for cobra squad season 2 DVD as perfect x-mas gift

4. Cars, Cars, Cars – r/t @SupremeGREAM today i was at biggest car yard on ngong rd and the only people there were salesmen, wash guyz and suppliers-grim(econ)! are you seeing some slowdown in autos? soe eyards have KBE and KBH that are gathering dust. – got a KBC Mark II been in the yard that long. today took it for a random drive. 780k bring the money. down from 1050k @inexes – Wambie wapunguze bei ya hizo magari! lol @bankelele
– r/t @Shitawabah saw a LAMBOGHINI today morning at 8;59 a.m yellow KBK 001A… ! eeeiy ! * but nid t say it was hot! <--wow! really? pics?
– r/t @karuoro If you own a Toyota-use toyodiy.com to look up part numbers so you know what to order (thanks-1/2 cars in kenya are toyota)

3. Peculiar Nairobi – @mountainous nation wrote that the only 3D theatre in kenya to watch #Avatar is in Nyali. Also #F1 off-season more
– Reading sundaynation about kayamba africa new album: ‘ KA is made up of 45 members who were all present. It has 6 band members’ (huh?)
– My dad was scandalized by the food portions at ONami, full house though
– Labour leader Atwoli sermons on #citizentv opposes privatization of #nationalbank #KCB #newKCC and kenya ports authority
– Family bank atm’s are so f’n unreliable these days. Spend some of that rights issue cash propely will ya? #gotissuez
Peculiar habits of Nairobians http://sogomo.blogspot.com/2009/12/ten-nairobi-pecularities-i-could-do.html

2. Credit Crunch – @coldTusker wouldn’t be uchumi be a better pick for al-waleed ‘distressed asset’ philosopy? @coldtusker – I think Al-Waleed looks for management as well. Kingdom doesn’t supply management. Maybe he will look at Uchumi as well
– At empty local; not sure if its mid-month economy or competition from new joint up the road with #kidum playing tonight
r/t @siphojanuary More than 8 million South Africans are 3 months behind on their debt repayments – National Credit Regulator
Dubair/t @ coldtusker Read the signs. The day Emirates stops serving alcohol means the new owners are in control. Dubai may keep Emirates in name only. Who knows who owns it now? Not for public consumption. – There is no free lunch. Something has to give. I think Emirates is the ‘guarantee/collateral’
r/t @alykhansatchu Dubai = Ozymandias Look on my works, ye mighty, and despair!’ Nothing remains http://bit.ly/1wWz2g

1. Phone Woes
Safaricom I thought my phone had gone schitso calling me every minute! But its some dude who sent big #mpesa to wrong number one digit off (not me!)
– dear #safaricom there are black hole spots (no service) in Nairobi CBD #gotissuez
– Safaricom have had a really crap network in Nairobi CBD all week. Only way to call their subscribers is by using zain or orange
– #barclays call centre number works and calls picked up instantly 3900000 #safaricom should learn http://www.moseskemibaro.com/?p=763
Zain #ogilvy media clarify that they are NOT repsonsible for advertising & PR of #zain africa #passthebuck #itwasntme (via @NationMedia)
– R/t @JustDes – #Zain PR and Advertising is handled by #ZKAdvertising. #Zain Media will be handled by #OgilvyAfricaMedia. @PeterNjenga – Any URL for this #Ogilvy media #Zain Africa #advertising thingie? Wanna know who’s getting paid but screwing up Zain #marketing?
– @JustDes thanks for clarifying about ZK and Zain http://www.zekgroup.com/index.php?option=com_content&task=view&id=6&Itemid=10 @peternjenga
mobile phones need messengers – Paying telkom,kenya power and safaricom bills this morning-if you are post-paid anything,you need a messenger to hoof around Nairobi – Where can one pay safaricom post pay bill on sunday, other than westgate?
– r/t @tmsruge True, because banks won’t allow transfers to mobile, which I think is another missed rev stream 4 banks – Sounds to me like a biz opportunity to me! Kenyan mobile $$ innovations are a bit one-track minded!
r/t @zulusafari even with mobile $ you still have to physically visit an office to put $ in ur account – seriously! it’s ridiculous. And why can I not pay by cc’d online!!!! @whiteafrican
r/t @ kahenya @whiteafrican @bankelele it keeps messengers busy and employed
r/t @whiteafrican which makes absolutely no sense in this day and age of digital money transactions locally.
competition for MPesa r/ @ Obopay Essar Telecom Kenya & Obopay Launch Mobile Money Transfer Service http://su.pr/21Vq0y

Can Africa Profit from the World Cup?

I was supposed to write a piece on business opportunities for the 2010 World Cup for Kenya; however the notice was short and though I started research, I never got to finish it by the deadline. Also I lost my notes and forgot about it, till I was jolted back by an e-mail from Emirates Airlines yesterday advertising world cup travel packages that include airline tickets, hotels selection and, most important, specific match tickets. I tried one and it came to about $4,000 to watch Algeria vs. England.

Back to the post, so besides global giants like Sony and Coca Cola, what other opportunities are there for Kenyan and other African nations & companies?

Airlines: while Emirates is the official partner of FIFA and can put together packages, their passengers flying to SA have to route through Dubai. Meanwhile local airlines like South African Airways, Kenya Airways, and Ethiopian Airlines that have huge footprints in Africa can fly hundreds of fans in and out of SA daily.

Road transport: Nairobi is 3,000 kilometers from Johannesburg and which would take perhaps a week to travel by road. Bunson Travels, a Nairobi agency, has scheduled an overland bus and truck transport package to South Africa, with the possibility of match tickets on some of the higher priced packages.

Tourism: The World Cup will draw thousands of people making their first or a rare trip to African continent, which can yyield opportunities for locales outside South Africa
Beach tourism: The World Cup is associated with summer, but takes place in winter in SA (southern hemisphere), and while the weather will be relatively mild compared to Europe and US winters, its not beach strolling weather like you could get in Mombasa, Zanzibar or Seychelles.
Regional packages: Ethiopian Airlines has travel packages that cover more than one country e.g. see the attractions of Ethiopia, Tanzania, Egypt, and Kenya and will probably sell those in SA. Likewise Kenya Airways (or local agents) who will probably have travelers from Thailand and China can draw on the same to entice people on the way back e.g. also tour the Great Rift highlands of Kenya and Ethiopia and visit athletic camps to see where world beating Olympic athletes hone their skills.

new Ole Sereni hotel neat Nairobi airport

Nairobi hotels: these are 4 hour flight away from South Africa, and will be much cheaper than the premium priced rooms in Johannesburg next June/July. Seasoned travelers may choose to cool off and wait to minimize their hotel bills
Sports counter programming: how about an event that takes place immediately after the world cup e.g. an international rugby tournament (safaricom safari sevens?), safari rally or a cross country event.
Training camps: for teams to practice away from fan and media attention, but in similar climate e.g. Naivasha

Logistics: Looking at the staggering numbers from the last world cup there are opportunities for hospitality, medical, security and other personnel, including K street. In IT support, there will be data, video, broadcast, and programming opportunities all of which will need capacity e.g. at the recent zuku internet launch, the Wananchi CEO bragged about the company having more fibre capacity than the entire current usage of South Africa!

Financing: Three years ago UAP insurance launched a World Cup savings plan (what happened to it?). And while Visa is the official FIFA partner, I won’t be surprised if Equity Bank launches a ‘world cup loan’ package to enable tardy fans to finance a trip to SA.

Curios: Local companies should put their African art and curios online with local companies like verviant And mamamikes, and not have to be there in SA physically to sell them to visitors.

Governments: there are opportunities for proactive governments to get involved and promote their countries with marketing campaigns, or with travel advice for locals, expedited transit visas (JKIA) or passport renewals. See what UK government is doing.

Which other local (non SA) companies have World Cup related packages, or have started, or can position themselves to profit from the 2010 World Cup in South Africa? Please post comments below, but not unrelated advertising spam