Etihad Airways, which is based in Abu Dhabi, has been able to turn a profit and is now focusing on improving its transparency, governance, and balance sheet. This is in preparation for a potential initial public offering (IPO) if its sovereign wealth fund owner decides to list the company. Etihad, which is the national carrier of the United Arab Emirates, announced net profits for 2022 and 2023, marking a significant turnaround from the significant losses it had experienced since 2016.
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Etihad is owned by Abu Dhabi wealth fund ADQ, which has listed several holdings since 2022. This is part of a broader strategy to diversify the oil-rich emirate's economy, deepen capital markets, and spur investment. According to Bloomberg, ADQ (which took over Etihad in October 2022 and appointed CEO Antonoaldo Neves) is considering an IPO for the airline as early as this year. Neves said in an interview with Reuters that the company is "working very hard so that whenever is the proper time to do an IPO, we are going to be ready." Neves said that it was well known that ADQ's objective is to list portfolio companies and that any IPO decision would be made by ADQ, not Etihad. However, in a sign of change, Etihad will publish its 2023 annual report by mid-April for the first time, including details of pandemic-related government support.
Etihad approved a seven-year growth plan in 2022 to turn around its streak of losses. In 2023, the company announced a net profit of 525 million dirhams ($143 million) and a previously unreported net profit of 92 million dirhams in 2022. Neves explained that the company is increasing efficiency to drive profits, which includes scrapping unprofitable routes and returning grounded aircraft to service. The company's "Journey 2030" plan aims to triple passengers and double its fleet by 2030.
This marks a return to growth after about six years of downsizing, which followed a failed bid to compete with Gulf rivals Emirates and Qatar Airways. Etihad had bought stakes in foreign airlines including Air Berlin, Alitalia, India's Jet Airways, and Virgin Australia, which all went bankrupt. Neves clarified that Etihad no longer holds those stakes and does not intend to invest in other carriers. Instead, the company is focusing on connecting Southeast Asia, the Gulf, and the Indian subcontinent to Europe and the U.S. East Coast with frequent flights, rather than ultra-long haul routes. Etihad currently operates 80 Boeing and Airbus passenger jets and five freighters.