Tuesday, Jun 12, 2012
Beijing: Emirates will not refinance its $550 million Islamic bond or sukuk, and will instead repay the sum in full, according to Tim Clark, Emirates president.
The bond, which matures on June 15, is expected to be paid in full and “not refinanced” given Emirates’ “strong cash balance”, Clark told Gulf News yesterday in an interview in Beijing, putting an end to the uncertainty that Emirates might be looking to refinance the bond.
“No, we are not refinancing the $550 million. We are just about to repay the sukuk. So, it’s going out. Whether we go for other bonds in the future, but we are not refinancing that one. It does mature this month but it’s going back. And it’s being repaid in full,” said Clark.
He said that the airline is well placed to finance its future aircraft deliveries. “We have a very strong cash balance at the moment. In very difficult times to have grown our cash the way we did, it’s pretty good. Alright, some of that is the bond money that’s existing at the moment, but nevertheless we will repay. If we need more in the future, we will go out and get some more.”
Asked if Emirates was indeed considering another bond soon, Clark said: “Possibly… never say never,” adding that there is, however, no timeframe in mind. “We are well financed for our future aircraft deliveries. We are covered,” he said.
Clark said recently that debt markets had become tougher for all airlines and that Emirates wasn’t sure that it needed to refinance its $550 million debt.
Emirates’ 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.
Meanwhile, Emirates reportedly said last week that it has raised Dh1.9 billion from an Islamic facility for the purchase of three aircraft, and that the carrier completed the 12-year loan to buy planes including the Boeing 777-300ERs and Airbus A380 with Dubai Islamic Bank, Al Hilal Bank and Ajman Bank.
By Shweta Jain Senior Reporter
Gulf News 2012. All rights reserved.
