Emirates repays $550m sukuk in full
By Editor - Tue Jun 19, 7:28 am
Dubai: Emirates airline said on Monday it has repaid a $550 million (Dh2.01 billion) sukuk bond in full on its maturity date June 18, 2012 and eyes more Islamic financing in the future amid the Eurozone debt crisis.
Gulf News had reported last week in an interview with the airlines’ President, Tim Clark, in Beijing, that the airline will repay its bond in full instead of refinancing it.
The $550m sukuk bond, listed on the Luxembourg Stock Exchange, was originally issued in 2005 with a seven year term, and was the first of its kind to be issued by Emirates, the carrier said in a statement, adding that it represented its “commitment to utilising a diverse range of funding tools, including Islamic financing”.
“With the Eurozone debt crisis on-going it is likely that Islamic financing, with its large pool of liquidity, will play an increasingly important role for us moving forward,” Shaikh Ahmad Bin Saeed Al Maktoum, President of Dubai Civil Aviation and Chairman and CEO of Emirates airline and Group, said in a statement.
He added that the repayment of Emirates’ first ever sukuk bond is part of the airline’s “varied financing strategy” and reflects its “robust financial position”.
Long term growth
“Our consistent profitability and sound business model continue to ensure that we receive sufficient offers of financing to support our long term growth,” he said.
Clark, meanwhile, said last week that Emirates was indeed considering another bond soon and that the airline was “well financed” for its future aircraft deliveries.
“Emirates uses a variety of financing options, including: operating leases, EU/US export credits, commercial asset-backed debt, Islamic financing, Conventional bonds as well as Islamic Sukuks,” it said in the statement.
The airline’s net profit fell 72 per cent in the last fiscal as the airline took a $1.6 billion hit from high fuel costs as well as a massive hit from having to ground a large number of its Airbus A380s following wing-cracks.
By Shweta Jain, Gulf News