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Airlines going public with an IPO listing is not “uncommon”, Antonoaldo Neves, CEO of Etihad Airways, said amid speculations of its possible listing following a stellar performance in 2023, with a positive outlook projected for this year.
“Airline is a capital-intensive business,” Neves told reporters and noted the airlines can benefit if they gain “access to the capital markets and public markets through an IPO”.
“Airlines and IPO are something very common. It’s not uncommon,” he told reporters as the company announced annual results for last year.
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In 2023, Etihad registered a total revenue growth of 11 per cent reaching Dh20.3 billion ($5.5 billion), operating result of Dh1.4 billion ($394 million), net profit of Dh525 million ($143 million), and passenger revenue hitting Dh16.7 billion ($4.5 billion).
Neves, however, stressed the decision to go public belongs to the shareholder, and not to the company management.
“We are working so hard to make sure that the company ticks all the boxes. So, that if one day the shareholder decides to do it, we are ready. The management has to be ready to do whenever the shareholder decides,” Neves said and pointed out that Etihad has the “obligation to be ready” whenever it’s the time for an IPO.
“If and when the shareholder starts the process, we will only know one month before that because we have to file an intention to float. There is no filing today about that. And if one day it happens, three, six months, one, two years, we’re going to be ready.”
Neves noted the team has to work hard to be ready for an IPO.
“If the shareholder decides it’s time to tap into that pool of capital, I need to be ready. I don’t want to be in a position where the shareholder calls me and says: ‘Well, I want to do it in 30 days’. And I tell: ‘I need one year’. It’s not a good position to be in as a CEO. So, you need to be ready. If you’re ready for an IPO, then you are a good company. What we’re doing here is making sure that Etihad is a great company.”
Neves noted the speculation of an IPO is a “happy” and “flattering” development.
“Five years ago, the speculation was different. It was ‘Look, Etihad is going to shut down, and returning planes’. It’s flattering that now the speculation is about IPO.”
Neves pointed out that an IPO is “not a destination”.
“The management is not here for an IPO. The management is here to make sure that we deliver on the mandate of the shareholder, which is to deliver extraordinary experience and make money.”
The CEO is excited about the year ahead as plans are underway to ramp up fleet with up to 10 planes, and newer destinations.
“We will have six A320s by June, and three 787 wide body by the end of the year or January 2025. So, we will have six to 10 planes. We will have 15 more planes in 2025.”
Etihad recorded a 40-per cent rise in passenger numbers, with 14 million passengers last year, and Neves said the target for 2024 was to reach 17 million passengers.
“It’s an expected figure. If we get the planes, there is no reason why we can’t fly 17 million passengers.”
Etihad launched 15 destinations in 2023. Last month, it started flying to Antalya in Turkey and Jaipur in India, and at least 3 more coming up this year. “We are excited for 2024.”
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