Gulf LCC Air Arabia substantially improved its half-year profits, despite continuing economic and geopolitical pressures in the region, the airline said.

The Sharjah-based carrier said its first-half net profit was up 47% at AED338 million ($92 million), compared to AED230 last time. It achieved the result on revenue of AED2.17 billion, up 20%.

Passenger numbers rose 12% to 5.82 million, while seat factor was 84%.

The airline said its 1H performance exceeded market expectations, citing strong cost control measures, improvement in yield and higher customer demand. It added 10 new routes to its network during the first half, which was marked by the arrival of its first Airbus A321neoLR.

The airline cautioned, however, that overall economy growth in the Middle East and North Africa (MENA) region was expected to continue at a “modest pace of 1.5 to 3%.”

It added that escalating geopolitical tensions in the region were expected to add further pressure on the economy, while slow economic growth in the eurozone was creating a tougher operating environment. Additionally, oil price volatility is expected to continue.

“Air Arabia’s record second-quarter and first-half 2019 performance reflects the strength of the business model we operate, as well as the appealing demand for the value-driven services that Air Arabia offers,” chairman Abdullah Bin Mohamed Al Thani said.

“The global and regional aviation industry continued to be impacted by pressing economic challenges and escalating geopolitical tensions during the first half of this year; despite that, Air Arabia managed to register record performance supported by strong passenger demand, momentum growth and operational efficiency.”

The new Airbus A321neoLR, which joined 53 A320ceos in the fleet, has since been joined by a second example, with three more expected by the end of the year. The new aircraft can carry 215 passengers in a single-class layout.

The larger aircraft will help the carrier expand to new medium-haul markets, in addition to strengthening its existing routes with increased seat capacity.

Four new destinations are being added from its main hub in Sharjah this year, to Kuala Lumpur (Malaysia), Tunis (Tunisia), Vienna (Austria) and Bishkek (Kyrgyzstan), with flights commencing in 3Q.

“Growth prospects for the MENA region remain strong for the aviation industry and especially for the low-cost travel segment,” Al Thani said. “We look forward to the remainder of the year as we continue to focus on expanding our geographic reach, driving cost control measures and investing further in value-driven product offering to our customers.”

During the first half, Air Arabia launched its new complimentary IFE system SkyTime that allows passengers to live stream digital content on smartphones, tablets or laptops on board.

Alan Dron