O N C O U R S E

ANNUAL REPORT
2017-18
THE EMIRATES GROUP
ANNUAL REPORT

2017-18

His Highness Sheikh Mohammed bin Rashid Al Maktoum

Overview

Emirates
Vice President and Prime Minister of the UAE and Ruler of Dubai
dnata

Group 2018 marks 100 years since the birth of the late Sheikh Zayed bin
Financial
Sultan Al Nahyan, the founding father of the UAE. It is an appropriate
Information time to reflect on his vision and legacy which has shaped and guided
Additional the journey of our nation for more than four decades.
Information

We are moving into a future where change will be constant and

people will experience unprecedented transformation in their daily
lives. More than ever, Sheikh Zayed’s values of wisdom, respect,
sustainability, and human development will provide a strong
compass for the UAE and Dubai’s plans to build the most advanced,
inclusive and prosperous city in the world.

Every year, the UAE makes great strides in its pursuit of overall
excellence. In the latest edition of the World Bank’s “Doing Business”
report, we moved up five positions to rank 21st in the world for Ease
of Doing Business. For the fifth year in a row, we were also
the highest ranked Arab nation in the list. The UAE’s global
competitiveness has been the result of our forward looking and
broad-based economic diversification strategy.

From our modest beginnings as a trading post, Dubai has grown

in importance as a regional hub for financial services, transport,
construction and many other sectors. We have been able to achieve
this position by harnessing the advantages of our geographical
location and by embracing the principles of free market competition.

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We have invested in building a best-in-class physical
infrastructure to support a thriving and diverse economy,
and consciously worked towards building an open and
inclusive society focused on the happiness and prosperity
of our citizens, residents and visitors.
Our ambition is to make Dubai a global hub for
Overview innovation and development, through a comprehensive
Emirates
transformation agenda outlined in our Dubai Plan 2021
and Smart Dubai 2021 strategies. Expo 2020 Dubai will
dnata
offer yet another platform to connect minds across
Group geographical boundaries and build bridges that will
Financial contribute immensely towards our ability to adapt to
Information
change and transition to a knowledge-based economy.
Additional
Information
By placing the wellbeing of people at the heart of our
strategy and by giving top priority to sustainability, we are
driving well-rounded growth, which in turn will increase
opportunities, attract innovators, and deliver tangible
progress and a better quality of life.
The Emirates Group is one of the UAE corporations that
is closely linked to the UAE and Dubai’s development.
Emirates and dnata’s relentless pursuit of excellence,
innovation and sustainability, reflect the values that have
underpinned the progress of our nation.
They have both grown from their base in Dubai to
achieve global prominence with operations spanning
over 84 countries and a strong reputation for quality.
Embracing competition and constant change, the Group
has remained successful through the years by continually
investing in people, infrastructure and technology, and by
having an unbroken commitment to transformation
and excellence.
The track record of the Emirates Group leaves me in no
doubt that it will continue to make a strong and positive
impact on the success story of Dubai and the UAE in the
years to come.
The Ghaf tree (prosopis cineraria) is the national
tree of the UAE. Indigenous to the UAE, it is
sturdy, evergreen and drought tolerant
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ANNUAL REPORT

2017-18

Overview

Emirates

dnata

Group

Financial
Information
Emirates is a global airline, serving 155 airports in 83 countries from its hub in Dubai,
Additional
Information United Arab Emirates. Operating the world’s largest fleets of Airbus A380 and Boeing 777
aircraft, its main activity is the provision of commercial air transportation services.

dnata is one of the largest combined air services providers in the world, serving over 300
airlines in 35 countries. dnata’s main activities are the provision of cargo and ground
handling, catering and travel services.

Emirates and dnata are independent entities and do not form a group as defined by
International Financial Reporting Standards. However, these entities are under common
management. Therefore, in the Management Review section of this document, they are
together referred to as the Emirates Group.

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Overview

Emirates

dnata
6 FINANCIAL HIGHLIGHTS
Group
8 CHAIRMAN’S STATEMENT
Financial
Information
12 LEADERSHIP
Additional
Information

14 EMIRATES: DELIVERING RESULTS 38 DNATA: ANOTHER OUTSTANDING YEAR 62 GROUP KEY EVENTS

20 INVESTING IN OUR STATE-OF-THE-ART FLEET
22 STRENGTHENING OUR GLOBAL NETWORK
24 AIR CARGO INDUSTRY LEADERSHIP
28 MAKING FLYING BETTER
32 BUILDING OUR BRAND
36 OUR PEOPLE, OUR SUCCESS
47 INDUSTRY LEADERSHIP AT WORLD’S BUSIEST 70 OUR GROWING NETWORK
INTERNATIONAL HUB
75 EMIRATES FINANCIAL COMMENTARY
51 BUILDING A QUALITY REPUTATION ACROSS OUR
85 DNATA FINANCIAL COMMENTARY
GLOBAL OPERATIONS
91 EMIRATES INDEPENDENT AUDITOR’S REPORT
55 GLOBAL EXPERTS IN WORLD CUISINES
96 EMIRATES CONSOLIDATED FINANCIAL STATEMENTS
59 GLOBAL PRODUCTS, SERVICES AND EXPERTISE
139 DNATA INDEPENDENT AUDITOR’S REPORT

142 DNATA CONSOLIDATED FINANCIAL STATEMENTS

180 ADDITIONAL INFORMATION

182 EMIRATES TEN-YEAR OVERVIEW

184 DNATA TEN-YEAR OVERVIEW

186 GROUP TEN-YEAR OVERVIEW

187 GROUP COMPANIES OF EMIRATES

188 GROUP COMPANIES OF DNATA

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190 GLOSSARY
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Financial Highlights
Overview

Emirates

dnata

Group
Emirates Group
Financial highlights 2017-18 2016-17 % change
Financial Revenue and other operating income* AED m 102,409 94,706 8.1
Information
Operating profit AED m 5,282 3,659 44.4
Additional Operating margin % 5.2 3.9 1.3 pts
Information
Profit attributable to the Owner AED m 4,113 2,460 67.2
Profit margin % 4.0 2.6 1.4 pts

Financial position
Total assets** AED m 141,625 133,281 6.3
Cash assets AED m 25,365 19,066 33.0

Employee data
Average employee strength number 103,363 105,746 (2.3)

* After eliminating inter company income/expense of AED 2,987m in 2017-18 (2016-17:

AED 2,559m).

** After eliminating inter company receivables/payables of AED 254m in 2017-18 (2016-17:
AED 324m).

Percentages and ratios are derived based on the full figure before rounding.

The financial year of the Emirates Group is from 1 April to 31 March. Throughout this
report all figures are in UAE Dirhams (AED) unless otherwise stated. The exchange rate of
the Dirham to the US Dollar is fixed at 3.67.

6
THE EMIRATES GROUP Revenue and operating income in AED m Profit attributable to the Owner in AED m Revenue and operating income in AED m Profit attributable to the Owner in AED m
ANNUAL REPORT

2017-18 17-18 92,322 17-18 2,796 17-18 13,074 17-18 1,317

16-17 85,083 16-17 1,250 16-17 12,182 16-17 1,210

15-16 85,044 15-16 7,125 15-16 10,630 15-16 1,054

14-15 88,819 14-15 4,555 14-15 9,160 14-15 906

13-14 82,636 13-14 3,254 13-14 7,565 13-14 829

Overview

Emirates

dnata

Group
Emirates dnata
Financial highlights 2017-18 2016-17 % change Financial highlights 2017-18 2016-17 % change
Financial Revenue and results Revenue and results
Information
Revenue and other operating income AED m 92,322 85,083 8.5 Revenue and other operating income AED m 13,074 12,182 7.3
Additional Operating profit AED m 4,086 2,435 67.8 Operating profit AED m 1,196 1,224 (2.3)
Information
Operating margin % 4.4 2.9 1.5 pts Operating margin % 9.1 10.0 (0.9) pts
EBITDAR AED m 24,970 21,248 17.5 Profit attributable to the Owner AED m 1,317 1,210 8.8
EBITDAR margin % 27.0 25.0 2.0 pts Profit margin % 10.1 9.9 0.2 pts
Profit attributable to the Owner AED m 2,796 1,250 123.7 Return on shareholder's funds % 19.3 20.3 (1.0) pts
Profit margin % 3.0 1.5 1.5 pts
Return on shareholder's funds % 7.9 3.8 4.1 pts Financial position
Total assets AED m 14,292 12,047 18.6
Financial position Cash assets AED m 4,945 3,398 45.5
Total assets AED m 127,587 121,558 5.0
Cash assets AED m 20,420 15,668 30.3 Key operating statistics
Net debt (including aircraft operating Aircraft handled number 659,591 623,611 5.8
lease) to equity ratio % 216.4 237.9 (21.5) pts Cargo handled tonnes '000 3,083 2,844 8.4
Meals uplifted number '000 55,718 60,747 (8.3)
Airline operating statistics
Travel services:
Passengers carried number '000 58,485 56,076 4.3 Total Transaction Value (TTV) AED bn 11.3 10.7 5.6
Cargo carried tonnes '000 2,623 2,577 1.8
Passenger seat factor % 77.5 75.1 2.4 pts Employee data
Overall capacity ATKM million 61,425 60,461 1.6 Average employee strength number 41,007 40,978 0.1
Available seat kilometres ASKM million 377,060 368,102 2.4
Aircraft number 268 259 9 nos

Employee data
Average employee strength number 62,356 64,768 (3.7)

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2017-18

Overview
Chairman’s statement
Emirates

dnata Ready to face challenges

Group
and maximise opportunities
Financial
Information
Our core businesses of aviation and travel have always been vulnerable
Additional to market dynamics and unexpected events, whether natural or
Information
man-made.

In 2017/18, we saw the gradual recovery of economic activity in key

markets which drove a strong uptick in airfreight activity and, to a
lesser extent, a rise in air travel and tourism demand.

Business conditions, while improved, remained tough. We saw

ongoing political instability and currency volatility in Africa including
massive devaluations. On the flip side, we benefitted from the relative
strengthening of key currencies like the Euro and Australian dollar
against the US dollar.

For Emirates, surging oil prices in the second half of our financial
year increased our operating costs. But it also stoked the embers of
economic recovery which contributed to better seat load factors and a
modest climb in yields.

Through the year, there was continual pressure on airfares as low cost
airlines began operating new aircraft capable of longer missions, and
targeting the same consumer segments as us. At the same time, legacy
airlines in Europe and Asia were investing more in new products, and
were more aggressive in leveraging their joint ventures.

dnata was also not immune to the vagaries of global markets.

Our operations at Iraq’s Erbil International Airport faced a six-
month disruption from September 2017, due to a ban imposed on
international flights.

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THE EMIRATES GROUP
ANNUAL REPORT
2017-18
Overview
Emirates
dnata
Group
Financial
Information
Additional
Information
In Europe, security risks contributed to a sharp drop in short-haul travel
to key European cities, while a supply shortage was experienced in
secondary European destinations as a result of travellers changing their
travel plans. However, this was balanced by a healthy increase in long-
haul travel and cruise bookings.
Competition across dnata’s business divisions remained cut-throat,
and we had to work even harder to grow new and existing customer
relationships, not through price discounts, but by investing to deliver
high-quality services and high standards of safety.
Solid business growth and performance
Against this backdrop, Emirates and dnata forged ahead to deliver the
Group’s 30th consecutive year of profit.
Our solid business growth and strong performance has led to record
Group revenues exceeding AED 100 billion for the first time, and a profit
of AED 4.1 billion, up 67% from last year.
Emirates carried 58.5 million passengers, 4% more than last year, and
our seat load factor improved to 77.5%. dnata handled 660,000 aircraft
and 3.1 million tonnes of cargo, a 6% and 8% increase over 2016/17
Emirates and dnata have delivered
the Group’s 30th consecutive
year of profit, and remain on
course for future success
respectively. dnata also served over 55 million meals to our customers at
62 locations around the world, and recorded a total transaction value of
AED 11.3 billion in our travel business.
2017/18 was a very good year for air cargo, the traditional bellwether for
economies, and both Emirates SkyCargo and dnata airport operations
reaped the fruits of investments into specialised products and facilities
that expanded our capabilities, and enabled us to offer even better
services to our customers.
While expanding our business and growing revenues, we also tightened
our cost discipline.
Across the Group, we progressed our initiatives to rebuild and
streamline our back office operations with new technology, systems
and processes. This year, our reduced recruitment activity, coupled
with restructured ways of working gave us gains in productivity, and a
slowdown in manpower cost increases.
Our investments
In 2017/18, the Group collectively invested AED 9.0 billion in new aircraft
and equipment, the acquisition of companies, modern facilities,
the latest technologies, and employee initiatives.
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THE EMIRATES GROUP
ANNUAL REPORT

2017-18

Overview

9.0
Emirates

dnata

Group Emirates made two significant commitments for new aircraft during
the year. At the 2017 Dubai Airshow, we announced a US$ 15.1 billion
Financial

AED
Information agreement for 40 Boeing 787-10 Dreamliners which will be delivered
from 2022. In February, we raised our commitment to the Airbus
Additional
Information A380 programme with a US$ 16 billion deal for 36 additional aircraft,
BILLION
including 16 options. These orders support our long-standing
strategy to operate efficient wide-body aircraft that offer the latest invested collectively across the Group on acquisitions,
passenger comforts. new aircraft and equipment, modern facilities,
employee initiatives and technology
Through the year, we introduced product and service improvements
on board and on the ground. We know that we need to continually
our acquisition of Destination Asia, one of Asia’s largest destination
work hard to earn our customers’ loyalty and win new fans, and these
management companies operating in 11 countries across the region.
investments will help us ensure that the Emirates experience remains at
the leading edge. Our Catering business will enter the Canadian market when our
CAD 7 million catering facility in Vancouver opens at the end of 2018.
We also expanded our customer proposition through partnerships.
We also invested in new catering facilities in Dublin, Ireland; and
Emirates entered into significant partnerships with flydubai and
Melbourne, Australia; and opened new marhaba lounges in Karachi,
Cargolux in 2017/18, boosting our global network connectivity and the
Pakistan, and Melbourne, Australia.
choice of air services that we offer for passenger and cargo customers
respectively. We also received authorisation to extend our partnership In addition, we worked hard to consolidate our acquisitions of previous
with Qantas until 2023. Emirates Skywards welcomed new partners into years with a focus on integrating efficiencies and steady organic growth.
our loyalty programme, offering members even more redemption and
earning opportunities. Our strategic focus on delivering safe, efficient, and high-quality services
consistently across our network has been critical to our success in
dnata strengthened our international footprint and capabilities with winning new ground handling and catering contracts during the year.
several key investments during the year. We entered the US cargo This also speaks to our ability to build strong long-term relationships
market with our acquisition of AirLogistix USA, and expanded our with our customers.
cargo handling capabilities with investments in new warehouses
and equipment at London Gatwick, UK; Amsterdam-Schiphol, During the year, we continued to seek balanced, diverse, and innovative
Netherlands; and Adelaide, Australia. In the travel space, we completed sources of funding from international markets to support our growth.

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Overview

4.9
Emirates

dnata

Group In 2018, we join the UAE in celebrating the 100th year since the birth
of the late Sheikh Zayed bin Sultan Al Nahyan, the country’s founding
Financial

US$
Information
Additional
Information
BILLION RAISED
using a variety of financing structures, including a US$ 600
million Sukuk in March
One of the highlights for 2017/18 was the successful execution of a
US$ 600 million Sukuk, the proceeds of which are earmarked for
aircraft financing.
On course for future success
Emirates and dnata have always responded to the immediate challenges
of each business cycle with agility, while not losing sight of the future.
We continue to work closely with key partners to deliver solutions
that improve customer experience, business outcomes, and drive our
respective industries forward. For instance, in October, we launched
the world’s first Aviation Experimental (X) Lab in Dubai’s Area 2071
with a consortium of partners. This initiative brings together airlines,
manufacturers, ground logistics, regulators, engineers, academics, and
start-ups under a single roof to seek solutions for the future of
air transport that no single organisation has the resources to deliver
on its own.
father. Sheikh Zayed’s values of wisdom, respect, sustainability, and
human development will continue to guide the way we conduct and
grow our business.
Looking ahead, the World Travel and Tourism Council forecasts
that there will be 1.8 billion international tourists by 2030, and the
International Air Transport Association (IATA) expects 7.8 billion
passengers to travel in 2036, nearly double the number of air travellers
in 2017.
Our dynamic hub, Dubai, already holds key spots on the global stage for
aviation and tourism. The city is also gearing up to welcome 25 million
visitors for the Expo 2020 Dubai in two years’ time.
Dubai’s business and tourism-friendly policies, and its infrastructure
investments will continue to position our home city favourably to
facilitate and benefit from the anticipated growth in demand for global
connectivity and air transport services.
At Emirates and dnata, we are ready to meet the opportunities and
remain on course for future success.

Over the years, we have diligently laid the foundations for a sustainable
and profitable future through our ongoing investments in infrastructure, HH Sheikh Ahmed bin Saeed Al Maktoum
technology, our people, and high-quality products. Chairman and Chief Executive, Emirates Airline and Group

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Leadership
Overview

Emirates

dnata

Group

Financial
Information

Additional
Information

HH SH E I K H AH M ED B I N
SA E ED AL M AK TOU M
Chairman & Chief Executive
Emirates Airline & Group
SI R T I M CL AR K G ARY C HAPM AN
President President
Emirates Airline Group Services & dnata

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THE EMIRATES GROUP
ANNUAL REPORT

2017-18

Overview

Emirates

dnata

Group

Financial
Information

Additional
Information

ADEL AHMAD AL REDHA THIERRY ANTINORI ABDULAZIZ AL ALI ALI MUBARAK AL SOORI NIGEL HOPKINS CHRISTOPH MUELLER

Executive Vice President Executive Vice President Executive Vice President Executive Vice President Executive Vice President Chief Digital &
Chief Operations Officer Chief Commercial Officer Human Resources Chairman’s Office, Facilities Service Departments Innovation Officer
Emirates Airline Emirates Airline Emirates Group & Project Management and Emirates Group Emirates Group
Non-Aircraft P&L

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THE EMIRATES GROUP
ANNUAL REPORT

2017-18

Overview

Emirates

dnata

Group

Emirates
Financial
Information

Additional
Information

14
THE EMIRATES GROUP
ANNUAL REPORT

2017-18

Delivering results
Overview

Emirates

dnata
Emirates is the world’s largest international airline. We facilitate global travel
Group

Financial
and trade traffic to Dubai, and through Dubai, connecting 157 destinations on six
Information
continents with high quality air travel and transport services. Over the years, Emirates
Additional
Information has earned a reputation for excellence with our focus on safety, efficiency, quality, and
service, across all aspects of our business and operations.

In 2017/18, we delivered a solid performance despite the relentless competitive

pressure and ongoing geopolitical challenges.

Emirates posted a profit of AED 2.8 billion, with revenues at AED 92.3 billion. Yields
across the network improved compared to the previous financial year, however these
gains were largely offset by higher fuel prices and increased competition. We closed the
year with an average passenger yield of 25.3 fils, up 2.3% from last year.

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THE EMIRATES GROUP
ANNUAL REPORT

2017-18

Overview

Emirates

dnata

Group

Financial
Information

Additional
Information

16 Emirates’ new First Class cabin on a Boeing 777-300ER aircraft

THE EMIRATES GROUP
ANNUAL REPORT

2017-18

Overview

Emirates

dnata

Group During the year, Emirates carried a new record of 58.5 million passengers
and 2.6 million tonnes of cargo across our network. Our average seat
Financial
load factor was 77.5%, against a 2% increase in capacity.
Information
Additional This reflects the modest uptick in consumer confidence and travel
Information
demand, the healthy rebound in airfreight demand, and Emirates’
continued ability to win over customers with our award-winning
products and services - both above and below wing.
The year also came with its share of challenges. Higher oil prices raised
our operating costs and ate into our profits.
As we began the 2017/18 financial year, the
new US restrictions on electronic devices
in aircraft cabins had just come into effect.
This followed the enhanced security vetting
procedures and new US entry requirements
implemented at the start of 2017.
Emirates worked closely with stakeholders to
address the new security requirements, and
Strengthening our customer proposition
During 2017/18, Emirates added two new passenger and three new
freighter destinations to our global network, offering our customers
even more travel choices.
In addition to our own organic network growth, we also expanded our
global connectivity through strategic partnerships. In July, we entered
a significant partnership with flydubai, which includes an extensive
codeshare agreement, integrated network collaboration, fleet
synergies, strategic schedule alignment, and initiatives to streamline
the customer journey across Emirates’ and flydubai’s operations at
Dubai International airport.
At the end of March, Emirates’ customers could access 92 additional
destinations on flydubai’s network. We also extended our successful
partnership with Qantas for a further five years until 2023, ensuring
customers of both airlines continue to enjoy expanded travel choices
and seamless connections between Australasia and key cities in Europe,
Middle East and Africa, as well as reciprocal frequent flyer benefits.

58.5
by July, our US flights were no longer subject
to the ‘electronics ban’. However, the raft of enhanced security measures
had impacted consumers’ travel appetite, leading us to reduce services
to the US for several months. It was close to year-end before we were
able to restore some of our US capacity in line with the gradual recovery
in demand.

Through the year, we continued to lay a solid foundation for our MILLION PASSENGERS
future with significant investments in our people, product, aircraft,
flew on Emirates in 2017/18,
and the latest infrastructure for our business. This will help extend our
a new record
competitive edge and ensure our long-term success.

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Overview On the cargo front, Emirates SkyCargo entered a strategic operational
partnership with Cargolux to collaborate on freighter aircraft capacity,
Emirates
block space and interline, and connectivity between Dubai and
dnata Luxembourg. In October, the partnership was reinforced with the
Group announcement of a codeshare agreement for cargo between the
two carriers.
Financial
Information
During the year, we signed agreements worth US$ 31.1 billion for 40
Additional Boeing 787 Dreamliners and 36 additional A380s. These new aircraft,
Information
which will be delivered from 2020 onwards, illustrate our long-standing
strategy of operating efficient wide-body aircraft that offer the latest
passenger comforts and features.
We continued to invest in providing our customers with industry-
leading travel experiences, and a strong value for money proposition.
One of the year’s highlights was the highly anticipated launch of new
cabin products for our Boeing 777 fleet, which include our game
changing fully-enclosed First Class suites, as well as refreshed Business
Class and Economy Class cabins for our 777-300ER; and our new, wider
Business Class seats arranged in a 2-2-2 layout on our 777-200LR.
On our A380 fleet, we introduced a refreshed version of our popular
Onboard Lounge.
Reducing our environmental impact, contributing to the community
As an airline, fuel efficiency has always been a key focus area for our
sustainability efforts. The delivery of 17 new aircraft, and retirement of
eight older aircraft in 2017/18 has enabled us to keep our average fleet
age at a youthful 5.7 years. Newer aircraft are also more efficient to
operate, helping us reduce our emissions per ATKM.

Our efforts were rewarded by customer loyalty, as Emirates Skywards
crossed a milestone of 20 million members, and by accolades including
“Best Airline in the World”, “Best Economy Class”, and “Best First Class”
in the TripAdvisor Travelers’ Choice® Awards for Airlines 2017 which are
based on unbiased customer reviews.
Emirates spends billions of dirhams on fuel each year,
so naturally we monitor the development of biofuel
technology with great interest. One of the highlights this
year is our participation in the “Fly Green Day” at Chicago
O’Hare airport in November, where we operated our first
‘official’ biofuel flight. In this initiative, the biofuel was
blended into the main airport fuel supply, rather than
specially tankered to the aircraft. We remain supportive
of developments towards safe, cost competitive, and truly

31.1
sustainable biofuels, and a commercially viable supply chain.

Through the year, our flight operations specialists continued to work

closely with air traffic management providers and airports around
the world to deliver more flight efficient routings and operational

US$
procedures to help reduce flight time, fuel consumption
and emissions.

BILLION
On the ground, we implemented a range of simple yet effective
commitment for new aircraft, with agreements for 40 measures to become more energy efficient and reduce our
Boeing 787 Dreamliners, and 36 additional Airbus A380s environmental impact.

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THE EMIRATES GROUP
ANNUAL REPORT
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Overview
Emirates
dnata
Group
Financial
Information
Additional
Information
Across 30 commercial and residential buildings in the UAE where
Emirates conducts business or has leased employee accommodation,
we organised energy usage studies, and surgically reduced the time
that lights and air conditioning are kept running during non-operational
hours. These energy savings reduced our electricity bills by about 8%
each month.
We also replaced over 400 light fixtures at our Dubai headquarters’
carpark with LED luminaires, cutting our energy consumption by 80%.
The new LED lights also have double the lifetime of previous fixtures,
reducing replacement costs.
Through the Emirates Airline Foundation, our non-profit
charity organisation, we continued to make a difference
in the lives of disadvantaged children. Projects supported
by the foundation span from India to Africa, including
Sri Lanka and Bangladesh. Our aim is to increase our
presence in the markets we fly to, and to strengthen local
communities by investing in the future of children
in need.
In 2017/18, the foundation helped fund the building of
a new facility for Safe Centre for Autism and Asperger’s
The Emirates Airline Foundation, our non-profit
charity organisation, continued making a
difference in the lives of disadvantaged children
with projects spanning from India to Africa
Syndrome in the UAE. The modern facility, slated to open end-2018, will
enable 100 more children to access special education.
In South Africa, we donated a new school bus and founded the building
of a new garage for the Fikelela Centre, an outreach programme in the
Western Cape that provides care and housing for 40 children under the
age of eight, who have been abandoned, orphaned, affected or infected
by HIV/AIDS.
The foundation supported Australian Doctors for Africa (ADFA) in their
missions to Ethiopia and Somaliland, where they delivered training
programmes, installed new equipment for hospitals, and performed
advanced orthopaedic care for patients in need. We also supported
doctors volunteering with the Italian organisation Mission Bambini in
their travel to Zambia to provide heart surgery for paediatric patients
suffering from congenital and rheumatic heart diseases.
In Nairobi, Kenya, we supported the meals programme at the Little
Prince Nursery and Primary School. Feeding the children, who are
from the poorest areas in the slums, keeps them at school, helps them
concentrate and stay healthy.
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Overview

Emirates

dnata

Group

Financial
Information
Emirates operates a modern and efficient fleet
Additional of Airbus A380 and Boeing 777 aircraft
Information

Investing in our state-of-the-art fleet

Emirates’ commitment to deliver superior comfort and an exceptional
inflight experience to customers is reflected in our investment in a state-
of-the-art fleet, with the latest wide-body aircraft.
At the end of 2017/18, our fleet was 268 aircraft strong, including
102 Airbus A380s, 153 Boeing 777s, and 13 Boeing 777 freighters.
Emirates is currently the largest operator of the Airbus A380 and the
Boeing 777 aircraft, two of the most popular and efficient aircraft
flying the skies today.
In November, Emirates announced a US$ 15.1 billion commitment for
40 Boeing 787-10 Dreamliners at the 2017 Dubai Airshow. These new
aircraft will enter into service from 2022 onwards, replacing older aircraft
that will be phased out from the fleet, allowing us to maintain efficient
operations and continue delivering an unmatched travel experience to
our passengers.
Emirates fleet, the Airbus A380 has helped us elevate our passenger
experience in the nine years since the aircraft joined our fleet. This latest
order takes Emirates’ total commitment to the A380 programme to
178 aircraft.
During the 2017/18 financial year, we received 17 new aircraft - nine
Boeing 777s and eight Airbus A380s. This included the landmark
delivery of our 100th Airbus A380 in November 2017.
We also retired eight aircraft as part of our fleet renewal strategy.
Our investment in new aircraft and retirement of older
aircraft kept our average fleet age at a youthful 5.7 years,
a figure that is considerably lower than the aviation
industry average.
World class fleet support

In January, Emirates announced a US$ 16 billion order for 36 additional In March, Emirates unveiled a new Business Class cabin
A380 aircraft, including 16 options - to be delivered from 2020 onwards. with wider seats in a 2-2-2 configuration on the first of its
The world’s largest commercial passenger aircraft and flagship of the 10 Boeing 777-200LR aircraft.

20
THE EMIRATES GROUP
ANNUAL REPORT

2017-18

Overview

Emirates

dnata

Group
The refurbishment of the aircraft was carried out completely in-house by
the Emirates Engineering team working closely with Boeing and other
Financial
Information
suppliers, demonstrating our world-class fleet support capabilities. The
aircraft was converted to a two-class configuration and Economy Class
Additional
Information seats were also refreshed. The remaining nine Boeing 777-200LR aircraft
in the fleet will be progressively reconfigured by Emirates Engineering
over the next year.
In addition to the cabin reconfiguration project, our Engineering team
completed 95 C-Checks on our fleet during the year to maintain them
in peak condition. With cutting-edge facilities including seven heavy
maintenance and four light maintenance hangars, and the expertise
acquired by being the largest operator of the Airbus A380 and Boeing
777 aircraft types, Emirates Engineering has also selectively
offered Maintenance, Repair and Overhaul (MRO) services
to external customers.
In January, Emirates Engineering’s Calibration Laboratory
became one of the first in the region to achieve ISO 17025
certification, which ensures the accuracy and standards of
tools and equipment used in the servicing of aircraft and
Sultan Al Nahyan. Demonstrating our commitment and support to Expo
2020 Dubai, Emirates also rolled out the first of 40 aircraft bearing the
special Expo 2020 Dubai liveries in three themes. Spanning 40% of the
total external surface area including the top of the aircraft, the Expo
2020 Dubai liveries are some of the largest decals to have been installed
by the team.
As part of our mission to constantly innovate and improve
efficiency across our operations, Emirates Engineering launched a trial
project to manufacture aircraft cabin components using the latest
3D printing technology.
Using Selective Laser Sintering (SLS), we printed video monitor shrouds
and cabin air vent grills that weigh less than components manufactured
traditionally. This has the potential for significant reductions in emissions
and costs when compounded over the entire fleet of Emirates aircraft.
Other advantages include quicker per-part production times and
reduced wastage of raw materials. With phase one of trials successfully
completed, Emirates will progress to the next project phases to
incorporate SLS 3D printing into our operations.

157
other components.

The Emirates Aircraft Appearance Centre – the world’s

largest dedicated aircraft painting facility completed 22 paint makeovers
in addition to end of lease repainting on seven aircraft. The centre also
undertook 19 large and 138 small decal installation projects on our
Airbus A380 and Boeing 777 aircraft.
D E C A L I N S TA L L AT I O N S
As a tribute to the founding father of the UAE, 10 Emirates aircraft were and 22 paint makeovers completed in-house at
fitted with a bespoke decal of the late His Highness Sheikh Zayed bin
Emirates Engineering

21
THE EMIRATES GROUP
ANNUAL REPORT
2017-18
Strengthening our global network
Overview
Emirates
dnata
Group Emirates connects the world to, and through, our hub in Dubai - offering
high quality air transport services to 155 destinations in 83 countries on
Financial
Information six continents.
Additional We continued to grow our network organically by adding new routes
Information
and flight services in response to opportunities created by the dynamic
competitive landscape and evolving consumer demand.
Through our strategic partnerships and codeshares, we also expanded
our network reach and relevance to customers.
In 2017/18, we launched two new passenger destinations and three
freighter destinations. We grew our European footprint with the addition
of daily services to Zagreb, Croatia. In the Far East, we started flights to
Phnom Penh, Cambodia, via a linked service from Yangon, Myanmar.
Our freighter network expanded with the addition of: Luxembourg City;
Maastricht, Netherlands; and Aguadilla, Puerto Rico.
As we took delivery of aircraft into our fleet, Emirates was able to add
capacity to 15 existing destinations, offering customers more choice of
flight timings and onward connections. We also expanded the number
of destinations served by our A380s to 48 with the introduction of
our flagship aircraft to Nice. In addition, Emirates led one-off A380
services to Colombo, Bahrain and Beirut. Our A380 product continues
to enjoy tremendous popularity among consumers, and over 99 million
passengers have flown on the aircraft as it enters its 10th year of service
in the Emirates fleet.
Strategic partnerships: more connectivity and consumer choice
Rather than pursue formal alliances, it has always been Emirates’
strategy to focus on targeted and strategic partnerships that deliver
22
mutual customer and commercial benefit. This enables us to retain
control over our own destiny and respond to industry changes
with agility.
Emirates’ portfolio of 22 codeshare partners in 61 countries and 130
interline partners extend the reach of our own global network, offering
more flight options for our customers.
In July, Emirates announced a significant partnership with flydubai,
enabling both airline to leverage and complement each other’s
networks, unlocking further growth and operational
scalability. The partnership includes an extensive codeshare
agreement, and goes further with a strong focus on
integrated network collaboration, fleet synergies and
strategic schedule alignment. Efforts are also underway
to streamline the customer journey across Emirates’ and
flydubai’s operations at Dubai International airport.
At the end of March, Emirates and flydubai offered
customers access to 92 destinations on our combined
networks, and by the end of 2018, customers will be able to
book travel to 157 destinations.
The partnership opened up new city-pair connections that did not exist
previously, allowing both Emirates and flydubai to feed traffic into each
other’s complementary networks, serving a bigger pool of customers
in more cities to bring them immense value and choice, along with
strengthening Dubai’s position as a global aviation hub.
The new model has opened up flydubai’s robust regional networks in
Russia, Central Asia and the Middle East for Emirates customers.
THE EMIRATES GROUP
ANNUAL REPORT
2017-18
Overview
Emirates
dnata
Group
Financial
Information
Additional
Information
For flydubai customers, the new partnership has allowed for seamless
connectivity to Emirates’ worldwide network spanning six continents.
Since the first codeshare operations began at the end of October,
more than 400,000 passengers have taken advantage of the seamless
connectivity offered by the Emirates and flydubai partnership.
In March, we received reauthorisation from the Australia Competition
and Consumer Commission to extend our partnership with Qantas until
2023. The evolution of our partnership involves network changes that
deliver greater year-round frequency and expanded services to Australia
and New Zealand for Emirates customers.
More than eight million passengers have travelled on
Emirates and Qantas’ combined network since 2013,
demonstrating the partnership’s exceptional customer and
connectivity proposition.
Under the renewed partnership, Qantas rerouted its
Australia-Dubai-London services to operate via Singapore
from March 2018, in addition to operating its own non-stop
flight from Perth to London. Customer demand for flights
between Australia and Dubai will remain well-served by
Emirates with 91 weekly services to Perth, Melbourne,
Phnom Penh in Cambodia joined Emirates’ global passenger network in 2017
Sydney, Brisbane and Adelaide, including nine daily A380 flights. Qantas
passengers will continue to have access to over 45 onward connections
on Emirates to Europe, the Middle East and Africa.
These changes mean customers now have three options for travel
between Europe and all Australian points on both Emirates and Qantas
- via Dubai, via Perth or via Singapore, and continue to enjoy reciprocal
frequent flyer benefits on both airlines.
The renewed partnership will also benefit customers flying between
Australia and New Zealand with increased flight services operated by
Qantas, as Emirates ceases trans-Tasman flights to Auckland, focussing
instead on our non-stop Dubai-Auckland service, and new Dubai-Bali-
Auckland flights which will launch in June 2018. We retain our existing
Dubai-Sydney-Christchurch flight.
In North America, Emirates enhanced its codeshare agreement with
JetBlue Airways to offer connections to an additional 20 routes for our
passengers, offering more flexibility and seamless connections in the
US. Today, Emirates passengers can access over 97 JetBlue destinations
across the US, Caribbean and Mexico from our 12 US gateways.
Additionally, our partnership with Alaska Airlines provides seamless
connections to 31 destinations via Seattle, Los Angeles and San
Francisco in the west coast of USA and Canada.
23
THE EMIRATES GROUP
ANNUAL REPORT

2017-18

Overview

Emirates

dnata

Group

Financial
Information

Additional
Information Emirates SkyCargo operates a dedicated freighter fleet of 13 Boeing 777s

Air cargo industry leadership

Emirates SkyCargo continues to lead the global air cargo industry as
the world’s largest international cargo airline measured by freight tonne
kilometres flown (FTKMs). In addition to belly-hold cargo capacity
offered on our fleet of 255 passenger aircraft, Emirates SkyCargo also
operates 13 Boeing 777 freighters.
In 2017/18, Emirates SkyCargo achieved a revenue of AED 12.4 billion,
an impressive increase of 17% over the previous year. This outstanding
performance in a resurgent air freight market enabled Emirates
SkyCargo to contribute 14% to the airline’s total transport revenue.
Carrying a record 2.6 million tonnes of cargo, Emirates SkyCargo
remains an important enabler of global trade, connecting production
and consumer markets across six continents. We successfully rode
the crest of the rise in demand for air freight capacity through the
development of a new portfolio of transportation solutions tailored
to industry verticals, landmark industry partnerships, and continuous
investment in products and facilities.
Innovative and specialised solutions
This year, we launched Emirates Fresh - a bespoke solution
for perishable commodities such as fruits, vegetables,
flowers, seafood and meat which retains their freshness
during the entire air transportation process. We also
developed the Emirates Fresh ventilated cool dolly
container to transport fresh cut flowers and ready-to-sell
cut fruits and vegetables.
Emirates Pharma, our customised offering for
pharmaceutical industries, has met with resounding success. Since the
launch in the last financial year, we saw the volume of pharma shipments
increase by 38%.
This year, we continued to advance our offering for pharma customers.
In partnership with DuPont, we introduced White Cover Xtreme, the next
generation thermal blanket that protects sensitive cargo from extreme
heat and cold, and rainy conditions. We also rolled out our pharma
corridors programme to offer enhanced origin-to-destination protection.

24
THE EMIRATES GROUP
ANNUAL REPORT

2017-18

Overview

Emirates

dnata

Group In the first phase of this programme, 12 cities across three continents
joined our pharma corridors network.
Financial
Information
Our Emirates Wheels product for the automotive industry and private
Additional car collectors has also met with great success. The average number of
Information
cars transported on our network has grown to between 150 and 200
cars per month - not only in the peak summer period, but throughout
the year.
Emirates SkyCargo is also exploring bespoke offerings in other sectors.
In November 2017, we signed an MoU with Dubai CommerCity to
develop new solutions for the e-commerce sector using Dubai as a hub.
in June with the aim of building up connectivity and improving the
seamless movement of goods between our hubs.
The success of the partnership is underpinned by Emirates SkyCargo’s
and Cargolux’s complementary strengths in terms of fleet, network and
operations, as well as our shared values in customer service excellence.
Emirates SkyCargo also worked in partnership with Qantas Freight to
strengthen the cargo capacity offered on the Trans-Tasman route for our
customers in Australia, New Zealand and across the world.
Freighter services and charter operations

First-of-its-kind partnership Emirates SkyCargo operates scheduled weekly freighter services to

In May, Emirates SkyCargo and Cargolux announced a unique strategic
operational partnership. Under this first-of-its-kind agreement between
a mainline cargo airline and a specialised freight operator, Emirates
SkyCargo and Cargolux work together on a number of areas including
over 45 destinations across the globe. In addition to Luxembourg, we
launched freighter services to Maastricht in the Netherlands, and to
Aguadilla in Puerto Rico.

12.4
freighter aircraft capacity, block space and interline, and connectivity
between Dubai and Luxembourg. In October, the partnership was
reinforced with the announcement of a codeshare
agreement for cargo between the two carriers.
AED

AED
Emirates SkyCargo has had one Cargolux Boeing 747
aircraft full time in its fleet since June 2017. This allows us
to offer nose loading freighter capacity to customers for
BILLION
transporting outsized and odd shaped shipments. Through
the partnership, we now offer cargo customers an extended revenue achieved in 2017/18, illustrating the resurgent air freight
global reach to destinations on Cargolux’s network. We also market and Emirates SkyCargo’s success in developing innovative
commenced scheduled freighter services to Luxembourg bespoke products and industry partnerships

25
THE EMIRATES GROUP
ANNUAL REPORT

2017-18

Overview

Emirates

dnata

Group

Financial
Information

Additional
Information

Emirates Wheels is a bespoke

solution for the automotive
26 industry and private car collectors
THE EMIRATES GROUP
ANNUAL REPORT

2017-18

Overview

Emirates

dnata

Group In addition, our freighter have flown to some 140 destinations on
charter operations. In all, we operated more than 362 charter operations
Financial
in the financial year, carrying a variety of cargo - from Emirates Team
Information
New Zealand’s sail boat from Auckland to Bermuda for the America’s
Additional
Cup race, to KhalifaSat, the first satellite built completely on UAE soil
Information
from Dubai to Incheon, South Korea.
Precious cargo that have been transported on Emirates SkyCargo
freighters also include champion racing and eventing horses flown for
major equine sporting events including the Dubai World Cup and the
Longines Global Masters.
Our freighter aircraft with the unique rose decal brought cheer to
people on special occasions. The aircraft touched down in Barcelona
for the Catalan festival of the Rose and in Shanghai to mark Chinese
Valentine’s Day. A special floral decoration was organised in Dubai to
mark the transport of perishables around the traditional South Indian
festival of Onam.
Setting standards
At the IATA World Cargo Symposium in March, Emirates SkyCargo
was awarded the Cargo iQ certification in recognition of our efforts
to provide customers with more transparency on the status of their
shipments and to minimise any errors in the process. We have invested
in setting up a dedicated 24/7 operational Cargo Operations Control
Centre (COCC) in Dubai which uses live cargo data and Cargo iQ metrics
to track a shipment’s journey against its ideal route map.
We were also awarded the ‘Authorised Economic Operator’
(AEO) certification by the UAE Federal Customs authorities
in March 2018. This allows faster customs clearance of
cargo travelling on Emirates SkyCargo in the UAE, leading
to quicker delivery times for our customers.
Emirates SkyCargo won a number of accolades this year in
recognition of our emphasis on quality and excellence in

28
customer service. These include: ‘Best Cargo Airline Middle
East’ for a record 28th time at the annual Cargo Airline of
the Year 2017 awards; ‘Best Air Cargo Carrier- Middle East’
at the 2017 Asian Freight, Logistics and Supply Chain (AFLAS) Awards;
‘Best Carrier - All Services’ and ‘Best Carrier - Flown as Booked’ at the
Quality Award Italy 2016, organised by the IATA Airfreight Forwarders
Association Italy (ANAMA).
RECORD WINS
With our expertise, network and customer focus, Emirates SkyCargo
as the ‘Best Cargo Airline Middle East’ at the annual
is in a strong position to deliver solutions that meet our customers’
Cargo Airline of the Year 2017 awards, in addition to
transportation needs and add further value to their business.
other accolades

27
THE EMIRATES GROUP
ANNUAL REPORT
2017-18
Making flying better
Overview
Emirates
dnata
Group Our customers remain at the heart of our business. We continually
innovate and invest in what matters most to our customers, from
Financial
Information product innovations to service enhancements.
Additional This year, Emirates again raised the bar for inflight product innovation
Information
with the launch of our latest Boeing 777-300ER in November. We
presented new interiors and enhancements across all cabin classes,
including our game-changing First Class private suites.
Incorporating cutting-edge technology, Emirates’ new fully enclosed
private suites have brought several world-firsts to market, including:
‘virtual windows’ in the middle aisle using real-time fibre-optic camera
technology, a NASA-inspired ‘zero gravity’ seating position, and a
personal video call service for our First Class customers. Design details
such as personalised lighting and climate control features within the
suite were inspired by the luxury automotive brand Mercedes-Benz.
In March, we unveiled a new Business Class cabin for our Boeing 777-
200LR aircraft, with wider seats in a 2-2-2 layout. This US$ 150 million
investment will see all 10 of our existing 777-200LR aircraft refurbished
to offer a two-class product of 38 Business Class seats and 264 seats in
Economy Class by 2019.
Our popular A380 Onboard Lounge also underwent a makeover. The
revamped social area entered service in August, delighting customers
with modern finishes, more seating options, and mood lighting amongst
other features.
We served over 110 million meals on board during the year, delighting
our customers with regionally inspired menus, and special treats for
widely celebrated events like Chinese New Year, Christmas, Diwali, and
28
Ramadan. We invested more than AED 540 million in our wine and
spirits programme in 2017/18, working directly with top vineyards
and distilleries around the world. Our commitment to finding the best
partners and products saw a range of upgrades across our cabins,
including inflight amenities, kids’ activity packs, and a myriad of other
little touches to enhance our customers’ comfort.
We continued to invest in onboard connectivity for our customers.
Over 99% of all Emirates flights are now Wi-Fi enabled, hosting more
than 10.3 million internet sessions in 2017/18. In addition, 451,511 calls
were made and over 1.6 million sms messages were sent using mobile
phones on our flights.
During the year, we more than doubled our free Wi-Fi data offer for
customers in all cabin classes to 20MB, and Skywards members in
certain tiers as well as customers in First and Business Class receive
unlimited free Wi-Fi. We also signed up with Thales to give our
customers best-in-class connectivity with speeds of up to 50Mbps on
our Boeing 777X aircraft due for delivery in 2020.
Emirates continues to provide customers across all classes a
host of entertainment options at their fingertips with the
industry’s most comprehensive inflight entertainment
system, ice. Awarded Skytrax’s “Best Inflight Entertainment”
for a record 13th year, ice now offers over 3,500 channels
presented in 43 languages, including over 700 movies from
around the world.
Customer experience on ground and online
The on-ground experience has always been an integral part
of the Emirates customer journey.
THE EMIRATES GROUP
ANNUAL REPORT

2017-18

Overview

Emirates

dnata

Group

Financial
Information
Emirates game changing,
fully enclosed First Class private suite
Additional
Information inspired by Mercedes-Benz

This year, we added a new dedicated lounge in Boston for our premium
passengers and frequent flyers, taking the number of dedicated Emirates
Lounges around the globe to 41. We also refurbished existing lounges
in Singapore and Bangkok, and completed a US$ 11 million makeover of
our lounges in Dubai airport Concourse B.
We partnered with premium automotive brand BMW for
an upgraded fleet of cars to chauffeur our Business Class
passengers in the UAE to and from the airport. We also
partnered with Mercedes-Benz for a fleet of S-Class cars
for our First Class passengers, providing an on-ground
extension of our latest Boeing 777 First Class experience.
During the year, we upgraded our contact centre
flights, check-in, gate and baggage. From August to March, nearly
12 million notifications were sent via the Emirates App, and it is
fast becoming the preferred channel for our customers on the go.
Our investment to offer LiveChat for customer service has also paid
off, achieving the highest satisfaction levels amongst all customer
engagement channels. In 2017/18, we handled over 1 million customers
on LiveChat, accounting for about 10% of all inbound queries to our
contact centres, representing a 260% increase in volumes from the
previous year.
Through the year, we worked closely with our partners and stakeholders
to streamline the customer journey at our Dubai hub. This included pilot
initiatives to fast-track and simplify passenger check-in, baggage drop-off
and tracking, and the use of advanced technology within the terminal.

150
technology platform which gave us more flexibility in
routing calls to our employees, thus increasing our customer response
times. We also introduced a new reservations system that makes it
easier for our front line employees to serve customers, and supports
continuous improvements to our system. As a result, customer
satisfaction scores increased by 14 percentage points since the
beginning of the year. US$
MILLION INVESTMENT
Helping our customers enjoy a stress-free journey, we began mobile
to refurbish all 10 of Emirates’ existing Boeing 777-200LR aircraft into a two-class product
push notifications to send customers real-time information on their
with new, wider Business Class seats, and refreshed Economy Class cabins by 2019

29
THE EMIRATES GROUP
ANNUAL REPORT

2017-18

Overview

Emirates

dnata

Group

Financial
Information

Additional
Information

Premium passengers and frequent flyers enjoy access to

30 41 dedicated Emirates Lounges around the world
THE EMIRATES GROUP
ANNUAL REPORT

2017-18

Overview

Emirates

dnata

Group Building loyalty Emirates Skywards continued to pursue partnerships that offer relevant
opportunities for our diverse membership base. We now provide access
Financial This year, our loyalty programme Emirates Skywards reached a milestone to more than 1.8 million hotel properties around the world through the
Information
of 20 million members worldwide. The programme’s steady growth hotel booking sites of Booking.com and Rocketmiles. We also expanded
Additional over the past 18 years stems from our focus on offering members value, our travel and lifestyle rewards partners with the addition of marhaba
Information
choice and flexibility. Meet and Greet service in Dubai and Mileslife in Asia.

In 2017/18, Emirates Skywards members redeemed 100 million miles
a day on average, on reward flights, hotel stays, retail purchases and
lifestyle experiences, including exclusive access to world-class sports and
cultural events supported by the airline. Flight upgrades and Cash+Miles
flight bookings topped the redemption categories with nearly 400,000
transactions each in the past 12 months.
We launched a new partnership with Standard Chartered Bank in
Pakistan, taking our programme’s total number of financial partners to
13 and expanding our co-brand credit card presence to seven countries.
With the addition of flydubai to the programme, we expanded by
61 new cities the number of destinations on which members can
earn miles.

We fully digitalised the Emirates Skywards card during the year, In February, we were recognised at the 10th annual Loyalty Awards
removing the need for members to carry a physical card, and we 2018, organised by FlightGlobal, clinching ‘Excellence in Management’
launched a dedicated Skywards section within the Emirates App to for outstanding strategy and leadership.
provide members with timely access to relevant programme information.
We are also putting big data to work to deliver more personalised offers
and experiences through predictive data modelling, leading to higher
engagement amongst our members.

100
MILLION SKYWARDS MILES
redeemed per day on average

31
THE EMIRATES GROUP
ANNUAL REPORT

2017-18

Overview

Emirates

dnata

Group

Financial
Information
Emirates interacts with, and inspires audiences
Additional around the world through creative campaigns,
Information events, and its direct digital channels

Building our brand

Our strong brand is one of our most important business assets.
Emirates’ global brand footprint and reputation as an airline
synonymous with quality and excellence continues to be an important
driver for our success in sales and marketing activity, and in attracting
talent, partners and investments for our business.
Emirates continued to strategically invest in our brand throughout
2017/18, with initiatives that cut across marketing, events and
sponsorships, and digital user experience.
We also stepped outside of conventional airline advertising to promote
Emirates’ latest products, creating cut-through with the use of humour.
In November, we worked with TV motoring expert Jeremy Clarkson to
unveil Emirates’ game-changing First Class private suites which were
inspired by Mercedes-Benz. In January, we released a new campaign to
promote our Economy Class and showcase our win as ‘Best Economy
Class” at the TripAdvisor Travellers’ Choice Awards for Airlines 2017.
Our online brand experience

This year we continued to reach, inspire, and interact with audiences
around the world through creative and impactful marketing campaigns,
corporate and industry events, as well as our direct digital channels.
One of the year’s highlights was the October launch of a US$ 15 million
campaign to promote our extensive global network. The campaign
illustrates how Emirates connects the world via Dubai, while cleverly
incorporating our inflight experience.
Our success in building brand familiarity and preference also drives
more consumers to interact with Emirates on our direct digital channels.
That is why we invest to ensure that our customers enjoy the same
high-quality Emirates brand experience online as they do inflight and
on the ground.
With the strong consumer shift towards using mobile devices to
manage travel, Emirates has focussed on providing an even better
mobile user experience.

32
THE EMIRATES GROUP
ANNUAL REPORT

2017-18

Overview

Emirates

dnata

Group
This year, we added handy new push notifications to help customers
while they travel. This feature sends alerts to customers when check-
Financial
Information
in opens, or if there are changes in departure times or gates; and also
proactively provides information on their baggage, flight status, and
Additional
acceptance status if they are on standby to fly.
Information
Over 10 million customers have downloaded the Emirates
App. Across iOS and Android, more than 1 million active
users interact with our app every month. Today over half of
the airline’s online check-ins are completed via our mobile
app. Importantly, our customers are telling us they love our
app, with user ratings of 4.4 / 5 on Android’s Google Play
Store and 4.5 / 5 on the UAE Apple App Store.
This year, we rolled out our redesigned emirates.com
making our brand experience as relevant and engaging as possible for
our diverse customer base.
Through the year, we continued to successfully use social media
platforms to gain positive exposure and connect with our customers.
By end-March, we had 18.1 million followers across Twitter, Facebook,
Instagram, LinkedIn and YouTube, with highly engaged fans on all
platforms. Today, Emirates is the most followed airline brand on
Instagram, YouTube and LinkedIn.
Throughout the year, we marked special occasions such as Father’s
Day, International Women’s Day, and widely celebrated festivals like
Eid, Diwali, Lunar New Year, and Christmas, with branded content that
showcased our company, our people, and our products in creative ways.

10
website that ensures our customers can enjoy the same
Emirates content and browsing experience, whether they are on their
mobile phones, tablets or computers. In December, we launched a new
homepage, which resulted in an uplift in flight searches and bookings.

During the year, we also launched new local language emirates.com

websites for Croatia, Sweden, Belgium (Flemish), and Indonesian Bahasa,
and a completely redesigned careers website for candidates seeking
MILLION CUSTOMERS
opportunities with the Emirates Group.
have downloaded the Emirates App. Across iOS and
Today, Emirates offers online content in more local languages than any Android, more than 1 million active users interact with
other airline, reflecting our global footprint and also our commitment to our app every month

33
THE EMIRATES GROUP
ANNUAL REPORT

2017-18

Overview

Emirates

dnata

Group
Sports sponsorships: global exposure and consumer engagement
Financial Sponsorships are one of the most visible ways Emirates brings our brand
Information
to life. Our sponsorships provide us the platform to reach and engage
Additional with consumers, linking Emirates with sports and cultural events that
Information
consumers are passionate about.
This year, Emirates partnered with football clubs Real Madrid and Paris
Saint Germain on a campaign using the clubs’ star players and our cabin
crew to highlight our shared values: teamwork, ambition, innovation,
and a passion for sports. The two videos produced for the #oneteam
campaign have been watched over 4 million times by end-March.
Through our partnerships with the world’s largest events and sporting
clubs, Emirates has become one of the most recognised brands in
global sports across football, cricket, tennis, golf, rugby, horseracing
and Formula 1®.
2024 season. This agreement is the largest ever
signed by the club and one of the biggest ever
agreed in football. Our partnership with Arsenal
is the longest running in the Premier League and
one of the longest relationships in world sport.
Arsenal’s home ground will also continue to be
known as Emirates Stadium up to 2028.
In August, we extended our title partnership
with the prestigious FA Cup through to 2021,
continuing our role as the first-ever title sponsor of this tournament.
We also renewed our European Tour agreement for another four years.
The new deal includes Emirates becoming an Official Partner of the
2018 Ryder Cup. Emirates currently supports 19 events on the European
Tour International Schedule, as well as the Race to Dubai, engaging with
millions of golf fans around the world.

During the year, our brand sponsored sports events were watched On the sailing front, Emirates welcomed the victorious crew of Emirates
by a global television audience of 9.2 billion. A total of 1,427 events Team New Zealand in Dubai, as they celebrated their epic win of the

9.2
generated 120,300 hours of dedicated Emirates branded TV broadcast prestigious 2017 America’s Cup.
coverage with a media value of US$ 3.7 billion.

We also continued to strengthen our association with some of the top

properties in sports.

In April, we signed one of the largest sponsorship deals in global

football, when we renewed our shirt sponsorship of Real Madrid for a
further five years until 2023. BILLION VIEWERS
reached on global TV via broadcasts of Emirates-sponsored
Emirates again made history when we extended our shirt sponsorship of
sports events during the year, with 120,300 hours of dedicated
Arsenal Football Club for a further five years until the end of the 2023-
Emirates brand exposure

34
THE EMIRATES GROUP
ANNUAL REPORT

2017-18

Overview

Emirates

dnata

Group

Financial
Information

Additional
Information

Emirates’ #oneteam campaign with Real Madrid

35
THE EMIRATES GROUP
ANNUAL REPORT

2017-18

Overview

Emirates

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Group

Financial
Information
Dubai Fitness Challenge: our employees’
Additional physical and emotional wellbeing is one
Information of our priorities

Our people, our success

Every day, our people deliver the exceptional travel experience that We celebrated the contributions made by our female employees on
Emirates is known for. Our agility and our ability to rise to any challenge the occasion of Emirati Women’s Day in August and on International
and come up with innovative solutions has always been thanks to our Women’s Day in March. Women have always been an important
talented, passionate, and diverse multinational workforce. part of the Emirates success story.

We are committed to investing in recruiting, training and developing
talent. We believe in empowering our employees and recognising
their contributions.
We were proud this year to have been recognised by Universum as the
Number 1 Employer of Choice in the UAE.
Recognising our stars
In 2017/18, 12,080 employees from the Group were recognised through
Najm, our rewards and recognition programme. Five outstanding
employees who went above and beyond their call of duty or who helped
deliver a significant positive impact on the business were rewarded with
the Chairman’s Najm awards.
36
Our employees’ physical and emotional wellbeing is one of our
priorities. To this end, we encouraged our colleagues to take part in
the Dubai Fitness Challenge which ran for a month from 20 October.
Launched by HH Sheikh Hamdan bin Mohammed bin Rashid Al
Maktoum, Crown Prince of Dubai and Chairman of the
Dubai Sports Council, the initiative encouraged individuals
to exercise 30 minutes every day for 30 days in a row. As
an additional incentive, all employees who successfully
completed the fitness challenge were rewarded with one
free service-related ticket to travel to any destination on
Emirates’ network.
As part of our commitment to keep our employees happy,
we also gave one service-related ticket for the second year
in a row to all eligible employees to mark International Day
of Happiness.
THE EMIRATES GROUP
ANNUAL REPORT

2017-18

Developing our workforce

Overview

Emirates One of the year’s highlights was the official launch of the Emirates Flight
Training Academy (EFTA), our state-of-the-art training centre for cadet
dnata
pilots. The Academy was officially inaugurated by His Highness Sheikh
Group Mohammed bin Rashid Al Maktoum, Vice President and Prime Minister
Financial of the UAE and Ruler of Dubai in November. Our investment in the
Information academy reflects Emirates’ commitment, as a global leader in aviation,
Additional to develop career-ready pilots for our airline as well as the broader
Information aviation industry.
Spread over an area of nearly 200 football fields in Dubai South,
EFTA houses 36 cutting-edge ground school classrooms, ground-
based simulators, a fleet of 27 modern training aircraft, a 1,800 metre
dedicated runway with modern navigation aids and lighting, an
independent air traffic control tower, rescue and firefighting service, and
a maintenance centre.
The training approach followed by EFTA is also quite
unique. Cadets move from training on the Cirrus SR 22 G6
single piston-engine aircraft directly to the Very Light Jet
(VLJ) Embraer Phenom 100EV aircraft. This allows cadets
more training time on jet aircraft which is more relevant for
commercial airline pilot careers. The first batch of students
under our National Cadet Programme moved into the
facility in September 2017. EFTA also placed an order for six
Over the last year, our Group Leadership & Talent team delivered
the equivalent of over 5,585 days of training to 13,105 employees. In
addition our employees signed up for and completed 61,642 online
courses. Using technology and online platforms allows our employees
better access to training content to refresh their skills and further hone
their competencies.
In partnership with the UK government, we rolled out a new e-learning
course for our cabin crew and airport ground employees on preventing
human trafficking.
Emirates Aviation University, our Group’s academic business division,
expanded its course offerings by launching five new business-centred
programmes in partnership with Coventry University. We also partnered
with Boeing for seven students to take part in a mentorship
programme developed by Boeing Middle East. In addition to academic
and career guidance, students also get a valuable opportunity to
develop their leadership skills and to get exposure to a corporate
working environment.
Emirates Aviation University organised a career fair in February, working
with key partners such as Rolls-Royce. The University also inaugurated
new student residences in summer 2017.

12,080
full motion Flight Simulation Training Devices configured
for the Cirrus SR 22 G6 and Embraer Phenom 100EV aircraft.

Our National Recruitment and Development team continued to develop

new career advancement opportunities for Emirati colleagues. We
partnered with PwC Middle East to offer UAE National graduates a
secondment opportunity with one of the world’s renowned professional
services company. We also enrolled Emirati colleagues in the latest
cohort of the Rolls-Royce leadership programme, bringing the total EMPLOYEES RECOGNISED
number of Emirati colleagues who have benefitted from the programme through Najm, our rewards and recognition programme
to 105 in the past six years.
37
THE EMIRATES GROUP
ANNUAL REPORT

2017-18

Overview

Emirates

dnata

Group

dnata
Financial
Information

Additional
Information

38
THE EMIRATES GROUP
ANNUAL REPORT

2017-18

Another outstanding year

Overview

Emirates

dnata
dnata delivered another outstanding year of robust growth in 2017/18. Profits
Group

Financial
rose 9% to AED 1.3 billion with revenue up 7% to AED 13.1 billion, surpassing all
Information
previous records.
Additional
Information
Each of our four business divisions - UAE Airport Operations, International
Airport Operations, Travel and Catering - experienced solid growth. The strong
performance correlates with our focus on quality, safety, our people, and driving
efficiencies across all our businesses in costs, processes, and resources.

Across our global network, we won new ground handling and catering contracts,
entered into new markets and renewed existing partnerships. We invested AED 600
million in acquisitions, new facilities and equipment, leading-edge technologies
and people development.

39
THE EMIRATES GROUP
ANNUAL REPORT

2017-18

Overview

Emirates

dnata

Group Our UAE Airport Operations completed a host of key initiatives aimed at
significantly enhancing the efficiency of our processes and infrastructure
Financial
Information in ground handling and cargo management. This positions us well to
serve Dubai International (DXB), the world’s number one airport for
Additional
Information international passenger traffic and Al Maktoum International (DWC),
which, when completed, is projected to be one of the world’s largest
passenger and cargo airports.
Our International Airport Operations entered the US cargo market for
the first time with the acquisition of AirLogistix USA, which included
a state-of-the-art cargo handling centre at George Bush
Intercontinental Airport in Houston. We also opened a
second cargo facility at Dallas Fort Worth International
Airport and expanded our ground handling services to
New York’s John F. Kennedy Airport Terminal 4. Our airport
hospitality brand, marhaba, opened new lounges at Karachi
and Melbourne airports.
This year, we also completed our acquisition of Destination Asia,
one of Asia’s largest destination management companies with
operations in 11 countries, marking dnata’s first foray into the
region’s inbound travel market.
The travel industry remains extremely competitive. Our focus is to
stay ahead by continuously looking at new opportunities in our core
business streams and in the associated travel services arena.
In April 2018, Catering announced an agreement to acquire Qantas’
catering business, subject to the approval of the Australian Competition
and Consumer Commission. Under the agreement, dnata will supply
catering for Qantas flights for an initial period of 10 years. Qantas’
catering businesses include wholly-owned subsidiaries Q Catering
Limited and Snap Fresh Pty Limited, an advanced meal production plant
in Queensland. If approved, this acquisition will allow us to leverage our
global network and catering expertise for Qantas.

In October 2017, we celebrated 10 years of handling the

10
Airbus A380 aircraft, starting with the arrival of the first
commercial flight from Singapore to Sydney in 2007. dnata is the world’s
most experienced A380 ground handler, serving 10 operators of the
world’s largest commercial jet at 18 airports.

Our Travel division saw a volatile year of trading as international security

threats continued to dampen demand, particularly short-haul travel
in Europe. However, this was more than offset by a healthy demand
in long-haul travel. Demand for cruise holidays remained strong,
particularly in Australia, with Imagine Cruising, our cruise business,
reporting a strong set of results in its first year of trading in this market.
YEARS
of handling the world’s largest passenger aircraft.
dnata is the most experienced A380 ground handler,
serving 10 operators at 18 airports

40
THE EMIRATES GROUP
ANNUAL REPORT

2017-18

Overview

Emirates

dnata

Group

Financial
Information

Additional
Information

dnata’s vision is to be the world’s most

admired air travel services provider
41
THE EMIRATES GROUP
ANNUAL REPORT

2017-18

Overview

Emirates

dnata

Group

Financial
Information

Additional
Information

dnata’s ground handling operations

42 span 80 airports around the world
THE EMIRATES GROUP
ANNUAL REPORT
2017-18
We welcomed Canada as our newest market when we won a licence to
Overview
provide flight catering services to airlines using Vancouver International
Emirates Airport. We have committed to invest CAD 7 million to build a catering
dnata facility in Vancouver, which will open in Q4 of 2018. We also opened
new catering facilities in Dublin and Melbourne, and strengthened our
Group
presence in the US with the acquisition of a New York-based inflight
Financial catering company, 121 Inflight Catering.
Information
Additional
As we continue to expand our business in traditional flight catering,
Information we are simultaneously responding with expertise and product offerings
to our airline customers looking for more onboard retail to boost
ancillary revenues.
Today, dnata operates in 35 countries where our 41,000 employees serve
more than 300 airlines and 235,000 travellers every day. Given the scale
of our operations and the number of people we impact, our primary
goal is to invest in laying a strong foundation of sustained business
practices and corporate values that will generate enduring growth.
In January, we announced a significant investment in Quantum,
a three-year programme that will transform our processes in business
support functions like Finance, HR and Procurement to ensure that
we thrive in the future business landscape and continue growing our
global presence. The latest Enterprise Resource Planning (ERP) solution
provided by SAP will establish the tools needed to run our businesses
35
IN
COUNTRIES
Our 41,000 employees serve more than
300 airlines and 235,000 travellers every day
efficiently by automating processes wherever possible. Quantum will
ultimately provide us real time, consistent information, to make better
decisions, manage and govern our global businesses more consistently,
effectively, and provide scalability for continued growth and expansion.
Phase one of this project is expected to be completed within the next
two years and will focus on dnata’s international businesses followed by
dnata’s UAE-based businesses, and Emirates’ operations.
Industry recognition
For the fourth consecutive year, we were named Air Cargo
News’ Ground Handler of the Year. We also picked up
significant awards for our Dubai ground handling operation
at the Aviation Business Awards; for our Travel division
at the World Travel Awards; for our Singapore Catering
business from Pax International; and for our Cargo team
from International Transport News.
Our commitment to investing in our people, in safety,
technology and the dnata brand is putting us on course to achieve our
vision to be the world’s most admired travel services provider.
Fostering a safety culture
Safety and doing things the right way continue to be at the heart of
everything we do. 2017/18 was focused on progressing dnata towards
becoming a learning organisation on safety and standards, where every
incident is regarded as an opportunity to improve and to put preventive
measures in place. Nearly 9,000 employees in Dubai participated in our
third dnata Culture Survey to get insights on our progress and how to
make an even safer place to work in. Similar surveys were rolled out to
our operations internationally.
43
THE EMIRATES GROUP
ANNUAL REPORT

2017-18

Overview

Emirates

dnata

Group During the year, we held leadership workshops across our network Committed to sustainable operations
to introduce the Integrated Management System (IMS), which was
Financial
launched in 2017. The IMS is a single framework of policies, procedures At dnata, we endeavour to effectively fulfil our environmental
Information
and processes across our businesses covering health, safety, security, responsibility wherever we operate. With our scale of operations,
Additional
environment and quality management. we recognise that even small initiatives can have a large impact.
Information

We also launched the Heart and Minds programme to support
employee behaviour and foster an organisational culture focused on
our One dnata values of safe and reliable operations. Our Safety &
Standards team commenced the development of a common standard
for observing, reporting, managing and investigating incidents for
application across our operations globally.
Across our network and business units, we are deliberately
investing in sustainable operations to conserve water
and energy consumption, recycle waste, reduce
carbon emissions and recycle materials, such as paper,
plastic, cardboard, wood, glass, metal, used cooking and
mineral oils.

In 2017/18, we invested AED 150 million to replace our

150
fleet of Ground Support Equipment (GSE) across our airport
operations, ensuring that modern, efficient equipment are
being deployed. Notably in the UAE, we already run a fleet of electric
GSE, with 30 baggage tractors, two conveyor belts and two pushback
tractors, and have added a further 50 Prius Hybrids to the fleet.

AED
MILLION
In the UK, we have partnered with a local GSE manufacturer to develop
electric trucks which could significantly reduce carbon emissions.
invested to replace our fleet of Ground Support Equipment (GSE) Leading by example, dnata’s senior leadership team in Dubai has also
across our airport operations, ensuring modern, efficient equipment replaced its fleet of company-provided vehicles with hybrid cars.

44
THE EMIRATES GROUP
ANNUAL REPORT
2017-18
Overview
Emirates
dnata
Group
Financial
Information
Additional
Information
Making a positive difference in our communities
dnata4good is dnata’s Corporate Social Responsibility programme,
designed to make a positive difference in the communities around
us through employee engagement and community involvement. The
programme encourages volunteer work, philanthropic efforts and
fundraising activities in support of three main causes – Education,
Humanitarian, and Wildlife Conservation.
Our projects supporting Education aim to address the
cycle of poverty and underlying obstacles that prevent
children from receiving quality education. Our employees
have launched initiatives to assist in the building of
schools and classrooms, vocational training, school meals,
early childhood education, teacher training, curriculum
development, and literacy and numeracy education.
This year, we completed our sixth school-building trek
to raise funds for the dnata4good schools programme. To date, more
than AED 900,000 has been contributed towards this programme. In
partnership with Dubai Cares, this money has helped build five schools
dnata’s fleet of hybrid vehicles at Dubai International airport
in poverty-stricken communities in Malawi and Nepal, with a sixth soon
to be constructed in Senegal.
We also actively support wildlife conservation in our operating regions
and beyond. In 2017, dnata Dynamos, a group of cyclists led by dnata
employees completed a challenging 618km cycling trek through France,
raising AED 150,000 for Rhino Revolution and Dubai Cares.
In 2017, dnata observed Breast Cancer Awareness month for the first
time. Our teams across the network collaborated with locally registered
charities to increase awareness of breast cancer and raise funds for
research into a cure for the disease.
dnata4good also supports three global observation days in alignment
with the United Nations: World Book Day, Breast Cancer Day and
Environment Day.
In the nearly four years since launching dnata4good, over 100 projects
have been completed and more than 10,000 employees across our
global network have participated in at least one initiative. So far, over
AED 4 million has been raised by our employees, including dnata
matching funds dirham for dirham.
45
THE EMIRATES GROUP
ANNUAL REPORT

2017-18

Overview

Emirates

dnata

Group

Financial
Information

Additional
Information

Safety and doing things the right way

46 remain at the heart of everything we do
THE EMIRATES GROUP
ANNUAL REPORT
2017-18
Industry leadership at world’s busiest international hub
Overview
Emirates
dnata
Group dnata’s UAE Airport operations manage passenger and cargo aircraft
landing at or departing Dubai. In 2017/18, revenues grew steadily by 4%
Financial
to AED 3.2 billion. Our teams handled over 211,000 aircraft movements,
Information
more than 89 million passengers, and in excess of 731,000 tonnes of
Additional
cargo at Dubai International (DXB) and Al Maktoum International (DWC)
Information
at Dubai World Central. Our airport hospitality brand, marhaba, serves
nearly one million passengers every year with its comprehensive range
of airport lounges and meet and greet services.
We continue to be recognised in the industry for our uncompromising
focus on operational excellence and customer service. We were named
Ground Services Provider of the Year in the 2017 Aviation Business
Awards. We were also named “Most Reliable Cargo Handling Company’
at the Logistics, Warehouse & Supply Chain Awards 2017, and were
presented with the Best Safety Management (Investigation) Award
by our customer, Cathay Pacific, in recognition of our high quality
investigation and rectification efforts.
40
AED
AED
MILLION
will be saved over the next five years by taking
the maintenance of airside buses in-house
Optimising processes and resources
As our operations expand in tandem with the growth
of Dubai as an aviation hub, we rigorously challenge
our processes and work practices by applying leading
technology and training to improve efficiency, safety, and
avoid unnecessary cost on a sustainable basis. In March,
we moved into our state-of-the-art airport operations
control centre, and in June, our load control centre moved
to a new, low-cost location off-airport.
In May, we brought the maintenance of airside buses
in-house. From this move, we expect to improve the quality of
maintenance, as well as generate savings of AED 40 million over
the next five years.
We accelerated the recycling programme for our fleet of 12,000 units
of Ground Services Equipment (GSE) at DXB and DWC. Instead of
replacing the equipment at the end of their life cycle, we now perform
a mechanical overhaul to put them back in service. Over 100 units of
GSEs have been renewed to-date, reducing waste generated from this
category of equipment by 250 tonnes, while passing all safety and
quality checks and achieving savings in excess of AED 14 million.
In DWC, we began testing new equipment and processes at the
passenger terminal, which has been undergoing significant expansion
works to serve the future growth of travellers and flights. The learning
from these tests is also being applied to enhance the efficiency of our
operations at DXB. We partnered with flydubai to trial remote control
electric vehicles used to service narrow-body aircraft.
47
THE EMIRATES GROUP
ANNUAL REPORT
2017-18
Overview
Emirates
dnata
Group Underpinning our success and ongoing commitment to excellence is
a strong culture that reflects our One dnata values. During the year,
Financial
Information we launched our LEAN academy, with its first 12 graduates. LEAN
is a methodology to help eliminate waste, reduce complexity and
Additional
optimise resources to add value to our customers. We trained the entire
Information
management team in the basic principles. Our employees generated
over 100 ideas, which are being evaluated for implementation.
In November, nearly 9,000 employees completed our third Culture
Survey, which tracks our progress on making dnata a better and safer
place to work. The response rate is the highest ever achieved, and the
results showed a significant improvement in employee engagement and
safety culture, reflected in improvements in all safety measures.
Transforming the future of cargo management
In line with a strong global pick-up for air cargo transport, we saw cargo
volumes handled increase by 2% to 731,000 tonnes during 2017/18.
Revenues from our cargo business increased by 6%.
The year saw a steady delivery of initiatives started
in 2014 to optimise our operations, covering facility
improvements, process changes, infrastructure upgrades
and IT development. We opened a new customer service
centre and cargo integrated control centre located in
the Dubai Airport Free Zone, as well as another cargo
warehouse, increasing our processing capacity by 25%.
In addition, we completed the conversion of all diesel-
powered forklifts to electric ones. This is reducing the
carbon footprint at cargo operations in Dubai by 80%,
48
saving 200,000 litres of fuel per year, and reducing CO2 emissions by
47 tonnes per year.
We also embarked on a series of technology initiatives aimed at
transforming our processes to meet future growth.
In September, we made a substantial investment in a cutting-edge
cloud-based software platform that will enable freight forwarders,
agents and airlines to plan all land transport processes with us more
efficiently. This solution, which will be implemented by July 2018, is the
first of its kind in the aviation cargo industry.
In March, we became the first ground handler to implement a global
roll-out of the iCargo terminal operation suite across all our stations.
This investment will enable us to manage our air cargo movement
worldwide seamlessly and have all our operations on one cargo
management IT platform using unified processes. The system will be
gradually implemented, and by 2020, will have a user base of over 5,000
employees across 27 stations in 10 countries.
We also successfully tested the use of blockchain technology to further
streamline and simplify our cargo delivery processes from origin to final
destination. We are now able to track the paper trail of cargo containers
by digitizing the supply chain, thereby eliminating redundant data,
improving transparency and tightening information security for
all stakeholders.
Throughout the year, we organised Cargo Connect, a series of forums to
demonstrate to our customers how our digital transformation roadmap
will provide significant efficiency improvements to their business. As the
aviation services leader in the market, we will continue to engage and
collaborate with all stakeholders in the UAE aviation eco-system to drive
innovation, and ultimately, deliver even better services.
THE EMIRATES GROUP
ANNUAL REPORT

2017-18

Overview

Emirates

dnata

Group

Financial
Information

Additional
Information

dnata was named ‘Ground Services Provider of the Year’

at the 2017 Aviation Business Awards

49
THE EMIRATES GROUP
ANNUAL REPORT

2017-18

Overview

Emirates

dnata

Group

Financial
Information

Additional
Information

dnata handles the world’s largest commercial

50 passenger aircraft for 10 airlines at 18 airports
THE EMIRATES GROUP
ANNUAL REPORT

2017-18

Building a quality reputation across our global operations

Overview

Emirates

dnata

Group Our international ground handling operations are in 78 airports around
the world, serving more than 300 airlines.
Financial
Information
dnata is one of the world’s largest providers of airport services,
Additional supporting airline customers with aircraft appearance; load control and
Information
flight operations; passenger assistance; lounges; technical maintenance;
cargo and ramp services.
In 2017/18, we focused on integrating the new businesses we acquired
the previous year and on leveraging our global network to deliver strong
growth. We handled 449,000 aircraft turnarounds, 2.4 million tonnes of
cargo, and saw strong revenue growth of 14% to AED 3.8 billion.
More than just size and scale, our teams are earning recognition for our
high quality standards, and winning over customers. Through the year,
we won over 90 contracts with new and existing customers, including
Etihad, Lufthansa Group, Air Canada, China Airlines, Saudia and Japan
Airlines. In November alone, we commenced 10 new contracts in one
day with six airlines at airports in Adelaide, Karachi, Islamabad, Lahore,
Amsterdam, Manchester, Toronto and Dallas.
The confidence our customers have placed in us reflects their
endorsement of our track record as well as the investment we have
Expanding in key markets
In the US, we received a new licence to provide ground
handling services at John F. Kennedy International Airport’s
(JFK) Terminal 4 in New York. This strengthened our existing
operations in JFK’s terminals 1, 7 and 8, as well as for UPS
and United States Postal Service. We also commenced
operations at Singapore Changi Airport’s new Terminal 4
with our customer, Cathay Pacific, and at JFK’s Terminal 8
with Cathay Pacific and Qantas.
marhaba, our airport hospitality brand, welcomed two
new lounges, at Karachi’s Jinnah International Airport in
Pakistan, and at Melbourne’s Tullamarine Airport Terminal 2, which is our
first Australian passenger lounge.
During the year, our operations at Iraq’s Erbil International Airport was
disrupted from September 2017 to February 2018 due to a ban imposed
on all international flights into and out of the Kurdistan region of Iraq.
Despite this, we continued serving domestic flights while ensuring our
readiness to recommence ground handling for international flights when
they resumed.

90
continuously made in our people, systems and processes to be a

+
preferred provider of air services in each market. This includes investing
AED 82 million on replacing our fleet of ground handling vehicles across
our global network.

CONTRACTS
won with new and existing customers, including Etihad,
Lufthansa Group, Air Canada, China Airlines, Saudia and Japan Airlines
51
THE EMIRATES GROUP
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Overview

Emirates

dnata

Group Boosting cargo capability In the UK, we enlarged our cargo handling capacity at Gatwick Airport to
support our growing customer base. We also expanded in Amsterdam
Financial In recent years, dnata has significantly expanded its global cargo with the opening of an additional cargo warehouse at Schiphol Airport.
Information
offering, including the opening of new cargo facilities, as well as The 91,000 sq ft (8,500 sqm) facility has a capacity of over 80,000
Additional investing in technology and leading-edge equipment. We now handle tonnes of cargo break down and build up per year. In
Information
2.4 million tonnes of cargo at 43 airports worldwide and continue to addition, dnata is the first handling company at Schiphol
increase our presence in key markets. Airport to offer temperature-controlled cargo dollies to
its infrastructure. The high-tech containers are specially
In May, we acquired AirLogistix USA, marking our first entry into the US
designed to serve the pharmaceutical industry with
cargo market and a further step towards becoming a global leader in
a closed temperature-controlled system for seamless
the handling of perishable and pharmaceutical cargo. The acquisition
delivery of temperature-sensitive goods from the
includes a 30,000 sq ft, state-of-the-art cargo handling centre at George
warehouse to the aircraft.
Bush Intercontinental Airport, the only dedicated perishable cargo
facility at Houston airport. In Australia, we opened our first airside cargo facility
in Adelaide. We also enhanced our export screening
As part of the same investment in AirLogistix USA, we officially opened
capability for USA bound cargo, investing AU$ 1.5 million
a second cargo facility in Dallas Fort Worth International airport (DFW)
in new infrastructure, improved operating procedures and employee
in March 2018. The 37,000 sq ft cargo centre features the only dedicated
training, which will strengthen the security of our customers’ shipments.
cool-chain perishable cargo at DWF and bears IATA’s CEIV accreditation
for the highest international standards.

91,000
ADDITIONAL

SQ FT
cargo warehouse opened at Schiphol Airport with capacity to handle over
80,000 tonnes of cargo per year

52
THE EMIRATES GROUP
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2017-18

Overview

Emirates

dnata

Group

Financial
Information

Additional dnata invests in its people, equipment and technology to

Information deliver safe, efficient and sustainable operations

Achieving efficiency and sustainability
While managing the rapid expansion of our business footprint, we are
concurrently committed to operating with a mindset of efficiency and
environmental sustainability.
In July, we opened a new 6,900 sqm maintenance base at
Singapore Changi Airport featuring green technology. With
three times more capacity than the first facility, the new
maintenance base can handle an average of 9,000 repairs
and maintenance activities annually.
capable of operating for 16 hours a day on batteries and saving an
estimated 32 tonnes of CO2 per year per truck.
Our commitment to excellence continues to garner industry
endorsement. For the fourth consecutive year, we were named by Air
Cargo News as ‘Ground Handler of the Year’. Our UK operation won
‘Best Air Cargo Terminal Operator - Europe’ for the third year running at
the 2017 Asian Freight Logistics and Supply Chain Awards.

32
To improve the maintenance operations of our ground
service equipment fleet in Australia, we signed a long
term agreement with Adaptalift GSE for a programme to
replace, renew, and refurbish our equipment. In addition to
increased utilisation, reliability and enhanced service to
our airline customers, the programme will lead to more efficient
operating costs.

In the UK, as part of our ‘Cleaning our air from the ground up’ TONNES OF CO2
philosophy, we deployed 10 electric vehicles across our operations saved per year per truck through our partnership with a GSE
which contribute positively to reducing our carbon footprint. We also manufacturer in the UK to develop electric trucks that can
partnered with a local GSE manufacturer to develop electric trucks operate for 16 hours a day

53
THE EMIRATES GROUP
ANNUAL REPORT

2017-18

Overview

Emirates

dnata

Group

Financial
Information

Additional
Information

54
dnata’s talented and passionate chefs use the freshest local ingredients
and the finest recipes to produce meals for our customers
THE EMIRATES GROUP
ANNUAL REPORT

2017-18

Global experts in world cuisines

Overview

Emirates

dnata

Group Every day, dnata prepares over 150,000 meals for more than 140 airlines
in 62 catering locations around the world.
Financial
Information
Our ability to deliver consistent and quality standards, our expertise in
Additional adding value to our customers’ business, and our ability to anticipate
Information
change and invest for sustainable growth, continue to win us new
contracts and recognition in the industry.
This year, we were named ‘Airline Caterer of the Year’ Asia by
readers of Pax International. We also earned accolades from our
customers including: ‘Best Global Caterer (Golden Spoon) 2017’ from
Beijing Capital Airlines, and ‘Best Corporative Caterer’ 2017 from
Xiamen Airlines.
In 2017/18, our catering business achieved a 7% increase in revenue to
AED 2.1 billion, driven by improved performance in most markets. We
uplifted more than 55 million meals to airline customers and continued
to expand our value-added inflight services such as onboard retail.
We won a number of new airline customers and extended existing
partnerships with others, including Hainan Airlines, Singapore Airlines
and Air China.
In several markets, we expanded our in-airport service, launching the
marhaba lounge brand at Melbourne Airport and catering for Emirates
and Lufthansa at their respective Milan Malpensa airport lounges.
We continued to add to and enhance our airport café and restaurant
business, which now includes more than 40 outlets across our network.
During the year, we rebranded our Australia flight catering business,
Alpha Flight Services, to dnata catering. This is in line with our ambition
to bring all our global businesses under the One dnata umbrella where
possible, to better leverage the strengths and synergies that come with
being a group, and to provide a consistent brand experience to our
customers around the world.
Strategic growth
While we continually drive excellence and results in our ongoing
operations, we also concurrently make strategic investments in markets
where we can add value and capitalise on growth opportunities.

150,000
MEALS
served each day to over 140 airlines in 62 catering locations
around the world

55
THE EMIRATES GROUP
ANNUAL REPORT
2017-18
Overview
Emirates
dnata
Group In Australia, we opened an AU$ 50 million state-of-the-art catering hub
at Melbourne Airport in September. With a space of 11,000 sq ft and a
Financial
Information capacity to prepare more than 750,000 meals a month, it is the largest
such facility in the southern hemisphere and attests to our ability to run
Additional
Information large-scale projects in mature markets.
In January, we opened our second catering facility in Ireland. The new
facility at Dublin Airport represents a strategic investment into a market
where we see great growth potential, with passenger traffic reaching
30 million annually, and an expanding base of international airlines.
The new facility currently has the capacity to produce 120,000 meals a
month, which can be increased if required.
In February, we entered the Canadian market when we were awarded a
licence to provide flight catering services to airlines departing Vancouver
International Airport. This exciting opportunity enables us to bring our
expertise in global and diverse cuisine, particularly halal and Asian,
to airlines and their passengers. We have commenced plans to invest
over CAD 7 million to build and fit-out a dedicated catering facility at
Vancouver, and expect to start operations in Q4 2018.
3
SILVER MEDALS
and a bronze for Cantonese cuisine at the World
Master Chefs Competition held in Hong Kong
56
We strengthened our presence in the North American market with
the acquisition of 121 In-flight Catering, a New York-based inflight
and VIP caterer in March 2018. This is pending approval from the
Committee of Foreign Investments in the United States (CFIUS).
121’s heritage in high-end restaurant catering aligns with our
ongoing focus on culinary excellence. Alongside the experienced 121
management team, we intend to expand further in the US, starting at
Nashville International Airport, where we will open a catering facility
in May 2018.
Capitalising on global trends
With passenger traffic growth from Asia projected to outpace other
regions in the next two decades, we have been enhancing our
capabilities as global experts in cuisine styles for this region.
Over the last five years, while building on our long-established
strengths in halal and Western cuisine, we have consciously focused
on developing culinary expertise in regional Asian cuisines such as
Chinese, Japanese, and Korean.
Our chefs have proven their specialist skills, garnering top placings at
Asian culinary competitions. In 2017/18, we won three silver medals
and a bronze for Cantonese cuisine at the World Master
Chefs Competition held in Hong Kong.
Our strategy continues to reap business results. During
the year, we have expanded our presence with China
Southern, Hainan Airlines, Air China and Tianjin Airlines in
Australia. We now provide inflight meals to every Chinese
airline flying into Australia.
THE EMIRATES GROUP
ANNUAL REPORT

2017-18

Overview

Emirates

dnata

Group

Financial
Information
dnata’s team of industry experts provides
customers with inflight retail solutions backed
Additional
by the latest technological innovations
Information

Our ability to identify key trends has enabled us to invest ahead
and capitalise on opportunities to continue thriving in a highly
competitive industry.
Building for flexibility and sustainability
Adding value to our customers
As the airline industry continues to invest in ancillary revenue
opportunities, we have been able to use our retail capability and
expertise to support our customers in their onboard retail strategies.

As we upgrade, expand, or invest in new facilities, we On top of the quality products we offer for inflight sales, we also provide
deliberately build for flexibility and sustainability, so that we dedicated support services, such as managing crew engagement,
can respond to catering trends and customer needs with training and incentive programmes, and a suite of technology solutions
agility and speed to market. Our food preparation areas, for customer marketing and management.
for instance, are equipped with modular systems that can
be easily reconfigured. Our dedicated product development and design business, En Route
International, expanded its product partnerships in 2018 with a number
Wherever possible, we have also invested in green building of leading, on-ground global brands now looking to us to launch their
design, equipment, processes and technology that support products inflight.
our commitment to sustainable operations. For instance,
replacing diesel powered ramp vehicles with hybrid and
electrical ones in the UK and UAE, using solar powered water heating
systems in Italy and the Czech Republic, and recycling used cooking oil
and packaging materials in Jordan.

57
THE EMIRATES GROUP
ANNUAL REPORT

2017-18

Overview

Emirates

dnata

Group

Financial
Information

Additional
Information

dnata Travel manages Arabian Adventures,

the Gulf region’s leading Destination
Management Company that creates
58 memorable experiences for visitors to the UAE
THE EMIRATES GROUP
ANNUAL REPORT

2017-18

Global products, services and expertise

Overview

Emirates

dnata

Group dnata’s diverse portfolio of market-leading travel businesses means that Tapping opportunities in the Middle East
we are well-placed to serve customers from all segments of the travel
Financial
Information industry with our products, services and expertise. In the Middle East, an upswing in both inbound and outbound tourism
demand presented opportunities to expand our operations in the region.
Additional Our travel brands include: Congress Solutions International; dnata
Information
Travel; Emirates Holidays; G Travel International; Gold Medal; MMI Travel; In the UAE, we continued to see a healthy increase in the number of
Netflights; Pure Luxury Worldwide Holidays; Sunmaster; The Global Travel inbound passengers. In 2017/18, 9.5 million customers who travelled to
Group; Travel2; Travelbag; and Travel Republic, as well as destination or transited through Dubai, used our services, a 9.1% increase from the
management companies (DMCs) Arabian Adventures and Gulf Ventures previous year. City Sightseeing Dubai, our hop-on-hop-off-tours, saw a
providing in-resort services and offering ground tours and activities in healthy 12% growth in bookings with revenues rising by 11%.
the UAE and Oman. We also have strategic stakes in Imagine Cruising,
Our travel management business in the UAE and in eight other countries
Destination Asia, City Sightseeing Dubai, and Travel Counsellors. We
across the region performed strongly, with sales growth of 14%,
manage EmQuest on behalf of the Emirates Group, and we have wholly
underpinned by a record number of new contracts, and achieving over 95%
owned and joint venture companies in eight countries in the Middle East
in customer retention rates.
and Indian subcontinent region.

In November, we launched the Yalago brand as a global leisure bedbank

In 2017/18, our travel division recorded solid growth, achieving a total
to serve third-party customers in the leisure travel segment with
transaction value of AED 11.3 billion. We purchased close to eight million
accommodation bookings, and have already secured 27 external customers.
room nights, a healthy increase over the previous year, as we continued
We also invested significantly in a health and safety programme, partnering
to optimise our centralised land purchasing function. Across our B2B and
with an independent provider to regularly audit all of our hotel suppliers
B2C brands, our Net Promoter Score finished at 63%, which is 10% points
around the world, so that our customers have peace-of-mind when booking
higher than the industry benchmark for Leisure, Travel & Tourism.

8
their stay with us.

Emirates Holidays expanded to the US, bringing our offering of exceptional

travel experiences to discerning travellers. We successfully trialled the use
of artificial intelligence in the US market with a cutting-edge advertising
campaign incorporating an AI-powered chatbot that interacts with
customers directly, recommending destinations and vacation packages
MILLION based on their preferences. We also expanded our online transactional
room nights purchased during the year presence to more countries and introduced Arabic websites.

59
THE EMIRATES GROUP
ANNUAL REPORT
2017-18
Overview
Emirates
dnata
Group As the travel industry continues evolving in a very competitive
environment, we are forging ahead with strategic investments in
Financial
Information our business transformation.
Additional In 2017/18, we created two travel reservation systems for Emirates Holidays
Information
and dnata Travel’s B2B business, to replace existing ones. The new systems
provide enhanced functionality and a more efficient way to serve our
partners and customers. In our contact centres, we are close to upgrading
our entire telephony platform worldwide, which coupled with a new
industry leading CRM system, will allow us to provide a superior customer
experience along with far greater efficiencies.
In December, EmQuest, Emirates’ technology distribution arm for the travel
industry, extended its partnership with global technology company Sabre
for an eight-year period. This exclusive partnership in the UAE, established
in 2009, has enabled EmQuest to be the preferred technology distributor
for travel management companies operating in the UAE.
On 9 February, it was announced that Hogg Robinson Group plc (HRG), in
which dnata holds a 21.85% shareholding, had received a recommended
cash offer from American Express Global Business Travel. On 16 March, the
offer was approved by the shareholders of HRG. However completion of
the acquisition remains subject to certain conditions, including regulatory
clearances. Following the expected completion of the transaction, dnata
intends to continue to partner with HRG in the Middle East and West Asia
where strong relationships have been developed over the past decade with
our corporate customers and agency partners.
Staying ahead of the pack in Europe
In Europe, the travel industry faced a challenging trading year. Customer
demand shifted away from higher security risk destinations in the
60
Eastern Mediterranean to the Western Mediterranean and led to
subsequent supply challenges and increased prices for the consumer.
On the positive side, the impact was mitigated by a healthy increase in
long-haul travel and cruise bookings.
Other industry challenges that we tackled during the year
included: the rise in fraudulent personal travel insurance
claims, and compliance with the European General Data
Protection Regulation (GDPR), which comes into force in
May 2018.
We also demonstrated our crisis management capability
with the robust handling of natural disasters, terrorist
activity, and company failures. For instance when Monarch
Airlines collapsed, disrupting the travel plans of many, we
were able to help our affected customers rebook their
travel plans quickly, minimising their inconvenience.
Our UK-based Imagine Cruising business completed its first year of
trading in Australia, where our Cruise and Stay Holidays were well
received. To boost growth in this market, Imagine Cruising acquired
Holiday Planet, a leading travel company in Perth.
During the year, we completed our new senior management team,
recruiting best-in-class professionals who bring breadth and depth of
travel experience to drive our growth in Europe and the Middle East.
We also established a panel of external advisers, who are distinguished
veterans in the travel industry, to lend their expertise and experience in
our expansion strategy.
THE EMIRATES GROUP
ANNUAL REPORT

2017-18

Overview

Emirates

dnata

Group

Financial
Information dnata serves customers from all
segments of the travel industry
Additional through our diverse portfolio of
Information products and services

Expanding in Asia Award-winning quality and service

In India, dnata won its biggest corporate travel management Our focus on quality and service continues to be valued by our
contract and achieved overall growth of 20% in the year. customers and recognised by the industry.

We completed our acquisition of a stake in Destination Asia, a
leading DMC with presence across 11 Asian countries. This formally
marked our entry into South East Asia’s inbound travel market.
At the World Travel Awards Middle East 2017, dnata Travel
won triple honours. We were named ‘UAE’s Leading Travel
Agency’ for the fourth consecutive year, ‘Abu Dhabi’s
Leading Travel Agency’, and ‘The Middle East’s Leading
Business Travel Agency’.

Arabian Adventures MICE became the first UAE-based

6
DMC to win the prestigious ‘Crystal Award for Excellence
in Incentive Travel’ from the Society for Incentive Travel
Excellence (SITE).

In the UK, Emirates Holidays swept the British Travel Awards

2017 with six wins. The team was voted by the travelling British
public for: Best Luxury Holiday Company, Best Family Holiday
TROPHIES Company, Best Holiday Company to the Middle East, Best Holiday
won at the British Travel Awards 2017 Company to the Indian Ocean, Best Holiday Company to Southern
Asia, and Best Holiday Company to South-East Asia (Silver Award).

61
THE EMIRATES GROUP
ANNUAL REPORT

2017-18

Overview

Emirates

dnata

Group

Financial
Information

Additional
Information
0 2 M AY
dnata is named Ground Handler of the Year at the 2017
Air Cargo News awards for the 4th consecutive year

1ST QUARTER

01 APRIL 10 APRIL
Emirates Holidays launches operations Emirates wins ‘Best Airline in the World’ at
in the USA as Emirates Vacations TripAdvisor’s Travelers’ Choice Awards for
Airlines 2017

03 APRIL 10 APRIL
Emirates SkyCargo launches SkyFresh, a dnata’s Catering team in Singapore
range of cool chain solutions for perishables picks up the ‘Airline Caterer of the Year’
and fresh consumables award from PAX International, a leading
publication for the catering industry

62
THE EMIRATES GROUP
ANNUAL REPORT

2017-18 21 JUNE
Emirates wins 13th consecutive ‘World’s Best
Inflight Entertainment’ award at Skytrax World
Airline Awards 2017

Overview

Emirates

dnata
0 9 M AY
Group dnata commences cargo operations in the
USA with its acquisition of AirLogistix USA’s
Financial
operations in Houston
Information

Additional
Information

0 9 M AY 01 JUNE
Emirates SkyCargo and Cargolux announce Zagreb, Croatia joins Emirates’
strategic operational partnership focusing on global network
aircraft capacity, block space and interline,
hub connectivity, and cargo handling

2 4 M AY 04 JUNE
Emirates launches ‘Together’ initiative in dnata Travel launches Secret Stays programme,
collaboration with key partners in Dubai offering the best last-minute deals in Dubai
to improve the traveller experience at and Abu Dhabi
Dubai International

3 1 M AY 12 JUNE
dnata Australia enhances its export Emirates SkyCargo starts freighter services to
screening capability for USA bound Luxembourg as part of its strategic partnership
cargo, investing AU$ 1.5 million in new with Cargolux
infrastructure, improved operating
procedures, and employee training

63
THE EMIRATES GROUP
ANNUAL REPORT

2017-18

Overview
2ND QUARTER
Emirates

dnata
0 1 J U LY 2 0 J U LY
Group Emirates launches daily linked service marhaba opens its first passenger
from Dubai to Phnom Penh in Cambodia, lounge in Karachi’s Jinnah
Financial
Information via Yangon in Myanmar International Airport

Additional
Information

0 1 J U LY 01 AUGUST
dnata opens its second cargo Emirates’ newly revamped A380 Onboard
warehouse at Amsterdam Airport Schiphol. Lounge makes its operational debut to
The brand new 8,500 sqm facility will help Kuala Lumpur
the business meet customer demand

1 3 J U LY
Emirates inaugurates its 41st
dedicated lounge at Boston Logan
International Airport
09 AUGUST
Emirates renews partnership with The
Football Association (FA) for another three
years. The agreement sees the tournament
continuing to be named The Emirates
FA Cup

1 7 J U LY
Emirates and flydubai announce an extensive
partnership, including a broad codeshare
agreement, schedule alignment, and network
optimisation to provide passengers access to
over 200 unique destinations
17 AUGUST
Emirates SkyCargo rolls out a new white
cover solution developed in collaboration
with DuPont, offering enhanced protection
for temperature-sensitive cargo

64
THE EMIRATES GROUP
ANNUAL REPORT

2017-18
12 SEPTEMBER
marhaba opens its first Australian passenger lounge at
Melbourne’s Tullamarine Airport Terminal 2

Overview

Emirates

dnata
22 AUGUST
Group Emirates becomes official partner of the
2018 Ryder Cup and extends its partnership
Financial
with the European Tour until 2021
Information

Additional
Information

24 AUGUST 15 SEPTEMBER
dnata ramps up recycling programme Alpha Flight Services in Australia opens its
for its fleet of 12,000 Ground Services 11,000 sq ft state-of-the-art catering hub at
Equipment (GSE) at both its Dubai hubs, Melbourne Airport, the largest such facility in
recycling 140 GSE units and reducing the southern hemisphere
waste by 250 tonnes in 2017

06 SEPTEMBER 21 SEPTEMBER
dnata digitalizes its end-to-end air cargo Emirates signs an agreement with
processes in Dubai, increasing transparency Real Madrid to extend its shirt
and co-ordination with freight forwarders, sponsorship until 2022
agents and airlines, via a cloud-based
software platform

07 SEPTEMBER
Emirates Flight Training Academy takes
delivery of its first two Cirrus SR22 G6
training aircraft, the first of the 22 single-
piston engine Cirrus aircraft ordered by the
Academy to train ab initio pilots
27 SEPTEMBER
Emirates clinches the Passenger Choice award for
Best Entertainment at the 2017 APEX Passenger
Choice Awards and is given a Five-Star Global
Airline Official Airline Rating

65
THE EMIRATES GROUP
ANNUAL REPORT

2017-18

Overview

Emirates

dnata

Group
25 OCTOBER
Financial dnata marks 10 years of handling the Airbus A380 aircraft, since the first commercial
Information
flight arrived in Sydney in 2007. dnata is the most experienced A380 ground handler,
Additional serving 10 operators of the world’s largest commercial jet at 18 airports
Information

3RD QUARTER
15 OCTOBER 29 OCTOBER
Emirates launches US$ 15 million dnata Travel earns triple honours at the World
campaign to inspire travel and promote Travel Awards Middle East 2017 - ‘UAE’s Leading
its global network including its Travel Agency’ for the fourth consecutive year,
home, Dubai ‘Abu Dhabi’s Leading Travel Agency’, and ‘The
Middle East’s Leading Business Travel Agency’

25 OCTOBER 01 NOVEMBER
Emirates and a consortium of industry Emirates unveils the first aircraft in its fleet
partners announce an initiative to build emblazoned with a new livery dedicated to
the world’s first Aviation X-Lab at Area Expo 2020 Dubai
2071, the experimental nucleus of the
UAE’s Centennial Plan

01 NOVEMBER
dnata celebrates a landmark day with 10 new
contracts, starting with six different airlines at
eight different stations - spanning Adelaide,
Karachi, Islamabad, Lahore, Amsterdam,
Manchester, Toronto and Dallas

66
THE EMIRATES GROUP
ANNUAL REPORT
12 NOVEMBER
2017-18 Emirates launches new interiors for its Boeing 777 aircraft, including
fully enclosed private suites in First Class inspired by Mercedes-Benz. The
global campaign for its new game-changing product was fronted
by motoring celebrity Jeremy Clarkson

Overview

Emirates

dnata 03 NOVEMBER 16 NOVEMBER

Emirates receives its 100th Airbus A380, and Emirates Engineering announces use of
Group
unveils a bespoke livery as a tribute to the cutting-edge 3D printing technology to
Financial late HH Sheikh Zayed bin Sultan Al Nahyan, manufacture components for Emirates’
Information founding father of the UAE aircraft cabins

Additional
Information

12 NOVEMBER 20 NOVEMBER
Emirates announces a US$ 15.1 billion Arabian Adventures launches new, revamped
commitment for 40 Boeing 787-10 tours and safaris to showcase the diversity of
Dreamliners, taking its total wide-body UAE’s attractions
commitment with Boeing to 252 aircraft

13 NOVEMBER
The Emirates Flight Training Academy
is officially inaugurated by HH Sheikh
Mohammed bin Rashid Al Maktoum,
Vice President and Prime Minister of the
UAE, and Ruler of Dubai
23 NOVEMBER
dnata’s cargo operations marks an innovation
milestone, as it successfully tests the use of
blockchain technology to improve efficiency,
security, and visibility for airfreight stakeholders
in Dubai, together with partners Emirates
Innovation Lab, flydubai Cargo, and IBM

15 NOVEMBER
Emirates and Thales sign an agreement
to equip the airline’s future Boeing
777X fleet with next generation
broadband inflight connectivity, using
the Inmarsat GX global network for
best-in-class connectivity
23 NOVEMBER
The Emirates Group publishes its seventh
annual Environmental Report outlining the
Group’s environmental performance for the
financial year 2016/17

67
THE EMIRATES GROUP
ANNUAL REPORT

2017-18

Overview
4TH QUARTER
Emirates

dnata
8 JANUARY 21 JANUARY
Group Emirates Group Security and Etihad dnata opens new flight catering facility at Dublin
Aviation Group sign a Memorandum Airport with a capacity of 4,000 meals a day, focussed
Financial
Information of Understanding for cooperation on serving premium long-haul airline customers. This
in aviation security is its second facility in Ireland, after Cork
Additional
Information

14 JANUARY
Arabian Adventures MICE becomes the first
UAE-based DMC to win the prestigious Crystal
Award for Excellence in Incentive Travel from the
Society for Incentive Travel Excellence (SITE)
05 FEBRUARY
Emirates Engineering announces agreement
with Qantas for aircraft maintenance, including the
stripping and repainting of eight Qantas A380 aircraft.
The agreement highlights Dubai as a centre of
excellence for Airbus A380 maintenance

16 JANUARY 06 FEBRUARY
Emirates launches ‘Upgrade your Airline’ Emirates SkyCargo expands its footprint in
campaign to promote travel on its Europe with new scheduled freighter services
award-winning Economy Class to Maastricht

18 JANUARY
Emirates signs a US$ 16 billion deal for 36
additional Airbus A380 aircraft including 16
options, taking its total A380 commitment
to 76 aircraft
08 FEBRUARY
The Emirates Group signs a Memorandum of
Understanding with the Andhra Pradesh
Economic Development Board to establish a
collaboration framework to support the development
of the Indian state’s aviation sector.

68
THE EMIRATES GROUP
ANNUAL REPORT
20 FEBRUARY
2017-18 dnata obtains licence to provide flight catering services
at Vancouver International Airport

Overview

Emirates
15 FEBRUARY
dnata Emirates SkyCargo transports KhalifaSat
from Dubai to South Korea on a specially 05 MARCH
Group chartered Boeing 777 freighter. KhalifaSat Emirates unveils its refurbished Boeing 777-200LR
is the first satellite developed and built by aircraft with two-class cabin, offering wider seats
Financial
Information Emirati engineers in the UAE at in Business Class laid out in a 2-2-2 configuration,
the Mohammed Bin Rashid Space and a refreshed Economy Class
Additional Centre (MBRSC)
Information

06 MARCH
dnata opens a 37,000 sq ft cargo centre at Dallas
Fort Worth International Airport, a US$ 3 million
investment that includes the airport’s only
dedicated cool-chain perishable cargo facility

19 FEBRUARY 22 MARCH
Emirates extends its shirt partnership with Emirates closes US$ 600 million sukuk bond
Arsenal Football Club for a further five years
until the end of the 2023/24 season

28 FEBRUARY 23 MARCH
Emirates Skywards reaches the Emirates and Qantas receive reauthorisation
milestone of 20 million members from the Australian Competition and Consumer
Commission to continue their
partnership until 2023

69
THE EMIRATES GROUP

Emirates’ growing network

ANNUAL REPORT

2017-18
Emirates operates flights to 157 destinations in 84
countries, offering industry-leading passenger and
cargo air transport services.

We connect the world to, and through, our hub

in Dubai.

Overview

Emirates Emirates destinations

dnata NORTH AMERICA BIRMINGHAM PRAGUE LAGOS BANGKOK
AGUADILLA BOLOGNA ROME LILONGWE BEIJING
Group
BOSTON BRUSSELS ST. PETERSBURG LUANDA BENGALURU
Financial CHICAGO O’HARE BUDAPEST STOCKHOLM LUSAKA CEBU
Information COLUMBUS COPENHAGEN VENICE MAURITIUS CHENNAI
DALLAS/FORT WORTH DUBLIN VIENNA NAIROBI CLARK
Additional
FORT LAUDERDALE DÜSSELDORF WARSAW OUAGADOUGOU COLOMBO
Information
HOUSTON FRANKFURT ZAGREB SEYCHELLES DHAKA
LOS ANGELES GENEVA ZARAGOZA TUNIS GUANGZHOU
MEXICO CITY GLASGOW ZURICH HANOI
NEWARK HAMBURG MIDDLE EAST HO CHI MINH CITY SEOUL
NEW YORK ISTANBUL AFRICA AMMAN HONG KONG SHANGHAI
ORLANDO LARNACA ABIDJAN BAGHDAD HYDERABAD SIALKOT
SAN FRANCISCO LIEGE ABUJA BAHRAIN ISLAMABAD SINGAPORE
SEATTLE LISBON ACCRA BASRA JAKARTA TAIPEI
TORONTO LONDON GATWICK ADDIS ABABA BEIRUT KABUL THIRUVANANTHAPURAM
WASHINGTON LONDON HEATHROW ALGIERS DAMMAM KARACHI TOKYO HANEDA
LUXEMBOURG CAIRO DUBAI INTERNATIONAL KOCHI TOKYO NARITA
SOUTH AMERICA LYON CAPE TOWN DUBAI WORLD CENTRAL KOLKATA YANGON
BUENOS AIRES MADRID CASABLANCA JEDDAH KUALA LUMPUR YINCHUAN
CIUDAD DEL ESTE MALTA CONAKRY KUWAIT LAHORE ZHENGZHOU
QUITO MANCHESTER DAKAR MASHHAD MALE
RIO DE JANEIRO MAASTRICHT DAR EL SALAAM MEDINA MANILA AUSTRALASIA
SAO PAULO MILAN DJIBOUTI MUSCAT MULTAN ADELAIDE
VIRACOPOS MOSCOW DURBAN RIYADH MUMBAI AUCKLAND
MUNICH ELDORET TEHRAN NEW DELHI BRISBANE
EUROPE NEWCASTLE ENTEBBE OSAKA CHRISTCHURCH
AMSTERDAM NICE HARARE ASIA PESHAWAR MELBOURNE
ATHENS OSLO JOHANNESBURG AHMEDABAD PHNOM PENH PERTH
BARCELONA PARIS KHARTOUM BALI PHUKET SYDNEY

Emirates presence
AFRICA MIDDLE EAST ASIA AUSTRALASIA
ADDIS ABABA ABU DHABI BANGKOK ADELAIDE
ARUSHA AJMAN RAS AL KHAIMAH BENGALURU AUCKLAND MELBOURNE
CAPE TOWN AL AIN SALALAH COLOMBO MALE BRISBANE NEWCASTLE
DAR ES SALAAM DUBAI SOHAR GALLE PHUKET CANBERRA PERTH
JOHANNESBURG FUJAIRAH SHARJAH HUA HIN SAMUI HOBART SYDNEY
70 ZANZIBAR MUSCAT UMM AL QUWAIN KRABI SINGAPORE LAUNCESTON WOLGAN VALLEY
THE EMIRATES GROUP
ANNUAL REPORT

2017-18

Overview

Emirates

dnata

Group

Financial
Information

Additional
Information

71
THE EMIRATES GROUP

dnata’s growing network

ANNUAL REPORT

2017-18
dnata’s business footprint in airport operations,
catering and travel services, span 196 cities and
airports across the globe.

We aim to be the world’s most admired air

services provider.

Overview

Emirates dnata presence

dnata NORTH AMERICA JOAO PESSOA GENOA AJMAN CHIANG MAI
ATLANTA JUAZEIRO DO NORTE GLASGOW AL AIN CLARK
Group
AUSTIN MACAPA HALIFAX AL KHOBAR DA NANG
Financial BOSTON MACEIÓ KINGSTON AMMAN DELHI / NOIDA
Information CHICAGO O’HARE MANAUS KNUTSFORD BAHRAIN FAISALABAD
DALLAS/FORT WORTH NATAL LAMEZIA TERME BURAIMI GUILIN
Additional
DETROIT PETROLINA LEEDS DAMMAM HANOI
Information
EL PASO PORTO ALEGRE LONDON GATWICK DOHA HO CHI MINH
GRAND RAPIDS PORTO SEGURO LONDON HEATHROW DUBAI INTERNATIONAL HONG KONG
HOUSTON RECIFE LONDON STANSTED DUBAI WORLD CENTRAL HYDERABAD
INDIANAPOLIS RIO DE JANEIRO LUTON DUQM INLE LAKE
LAREDO SALVADOR MANCHESTER ERBIL ISLAMABAD
LOS ANGELES SANTAREM MILAN LINATE FUJAIRAH JAKARTA
LUBBOCK SAO LUIS MILAN MALPENSA IBRA KABUL
MCALLEN SAO PAULO NAPLES IBRI KARACHI
MILWAUKEE TERESINA NEWCASTLE JEDDAH KOH SAMUI
NEW YORK OLBIA JUBAIL KOTA KINABALU
NEWARK EUROPE PALERMO MAABELA KUALA LUMPUR
ONTARIO ABERDEEN PISA MUSCAT KYOTO
ORLANDO ALGHERO PRAGUE NIZWA LAHORE
PHILADELPHIA ALTON PRESTON QASSIM LUANG PRABANG
SAN DIEGO AMSTERDAM ROME CIAMPINO RABIGH MANDALAY
SANFORD BARI ROME FIUMICINO RAS AL KHAIMAH MANILA / MAKATI
SAN FRANCISCO BELFAST SANDYCROFT RIYADH MULTAN
TAMPA BIRMINGHAM SOFIA SALALAH MUMBAI
TORONTO BOLOGNA SOLIHULL SEEB PATTAYA
WASHINGTON BRIGHTON SWINDON SHARJAH PENANG
WICHITA BRINDISI TRAPANI SOHAR PESHAWAR AUSTRALASIA
BRISTOL TURIN TAIF PHNOM PENH ADELAIDE
SOUTH AMERICA BUCHAREST VENICE YANBU PHUKET AUCKLAND
ARACAJU CAGLIARI VERONA PUNE BRISBANE
BELEM CARDIFF WINCHESTER ASIA QUETTA CAIRNS
BOA VISTA CATANIA ZURICH AHMEDABAD SHANGHAI CANBERRA
BRASILIA CHELTENHAM BAGAN SIEM REAP COOLANGATTA
CAMPINA GRANDE DONCASTER AFRICA BALI SINGAPORE DARWIN
CURITIBA EAST MIDLANDS CAPE TOWN BANGKOK TOKYO MELBOURNE
FLORIANOPOLIS EDINBURGH JOHANNESBURG BEIJING VIENTAINE PERTH
FORTALEZA FLORENCE MIDDLE EAST BENGALURU YANGON SYDNEY
ILHEUS GENEVA ABU DHABI CEBU YOGYAKARTA TOWNSVILLE
72
THE EMIRATES GROUP
ANNUAL REPORT

2017-18

Overview

Emirates

dnata

Group

Financial
Information

Additional
Information

73
THE EMIRATES GROUP
ANNUAL REPORT

2017-18

Overview

Emirates

dnata

Group 7 5 E M I R AT E S F I N A N C I A L C O M M E N TA R Y

Financial
Information 8 5 d n a t a F I N A N C I A L C O M M E N TA R Y
Additional
Information 9 1 E M I R AT E S I N D E P E N D E N T A U D I TO R ’ S R E P O R T

9 6 E M I R AT E S C O N S O L I D AT E D F I N A N C I A L S TAT E M E N T S

139 dnata INDEPENDENT AUDITOR’S REPORT

1 4 2 d n a t a C O N S O L I D AT E D F I N A N C I A L S TAT E M E N T S

1 8 1 A D D I T I O N A L I N F O R M AT I O N

190 GLOSSARY

74
THE EMIRATES GROUP
ANNUAL REPORT

2017-18

Overview

Emirates

dnata

Group

Financial
E M I R AT E S
Information

Financial
Additional
Information

C O M M E N TA R Y

75
 Profit attributable to the Owner in AED bn Profit margin in % Revenue trend in AED bn Passenger seat factor in %
86.7 91.2
THE EMIRATES GROUP 7.1 83.5 83.8
ANNUAL REPORT 80.7

2017-18 8.4
4.6 79.4 79.6
3.3 77.5
2.8 5.1 3.0
3.9
1.3 76.5
1.5 75.1

13-14 14-15 15-16 16-17 17-18 13-14 14-15 15-16 16-17 17-18 13-14 14-15 15-16 16-17 17-18 13-14 14-15 15-16 16-17 17-18

Overview Operating profit in AED bn Return on shareholder’s funds in % Revenue in AED m 2017-18 2016-17 % change
8.3 Passenger 73,963 68,491 8.0
Emirates
23.8 Cargo 12,439 10,592 17.4
dnata 5.9 Excess baggage 433 392 10.5
4.3 4.1
Group
17.2 Transport revenue 86,835 79,475 9.3
2.4 13.6 7.9 Sale of goods 2,982 2,932 1.7
Financial
Information
Hotel operations 746 738 1.1
3.8
Emirates Others 662 687 (3.6)
Financial 13-14 14-15 15-16 16-17 17-18 13-14 14-15 15-16 16-17 17-18
Commentary Non-transport revenue 4,390 4,357 0.8
dnata Total 91,225 83,832 8.8
Financial
Commentary

Emirates
Consolidated Emirates continued to cruise through
Financial
Statements the turbulent winds of competition
and geopolitical challenges, and
dnata remained ‘On Course’ with its growth
Consolidated
Financial plan, providing best-in-class air
Statements transport services to its customers.
Financial year 2017-18 was our
Additional
Information 30th consecutive profitable year.
Our growing passenger and cargo
capacity numbers demonstrate the
popularity of our product and network.
Enhanced consumer confidence further
strengthens our resolve to continue
developing our business profitably and
sustainably. Better yields, an ever-
improving product, higher passenger
numbers, an upsurge in cargo business
and a weak US Dollar, all contributed to
this year’s performance.
We continued with our strategy of fleet
modernisation, adding 8 A380 super-
jumbos and 9 B777s to our fleet while
phasing out 8 older aircraft. This led to
a net capacity growth of 1.6% to 61.4bn Operating profit Transport revenue which forms more
ATKMs. We enhanced our service by The operating profit for the year was up than 95% of Emirates revenue, increased
investing in new aircraft cabin interiors at AED 4.1bn (2016-17: AED 2.4bn) and by 9.3% to AED 86.8bn (2016-17: AED
and lounges. operating margin increased to 4.4%, 79.5bn).
a healthy 1.5%pts increase from the
We transported 58.5m passengers An increase in the fleet size, introduction
previous year (2016-17: 2.9%).
(2016-17: 56.1m) and carried 2.6m of new destinations, higher frequencies
tonnes (2016-17: 2.6m) of cargo during to existing destinations and better load
Return on shareholder’s funds
the year. factors successfully improved passenger
The improved profitability ensured a numbers, RPKMs and cargo carried.
Profitability 7.9% return on shareholder’s funds,
more than double the 3.8% return An improved pricing strategy and
Profit attributable to the Owner achieved last year. increased demand generated
Our operations continued to be higher passenger and cargo yields.
profitable and the profit attributable to Revenue Furthermore, the strengthening of major
the Owner stood at AED 2.8bn. This is Revenues crossed the AED 90bn mark currencies against the US Dollar pushed
123.7% better than last year’s profit of and stood at AED 91.2bn (2016-17: AED revenues favourably by 1% (2016-17: 3%
AED 1.3bn. 83.8bn). unfavourable).
Profit margin
2017-18 2016-17 % change
The profit margin doubled compared to
Passengers carried million 58.5 56.1 4.3
the previous year and at 3.0% (2016-17:
Available seat km ASKM million 377,060 368,102 2.4
1.5%) represented a strong result despite
higher fuel prices during the year. Passenger seat km RPKM million 292,221 276,608 5.6
Passenger seat factor % 77.5 75.1 2.4 pts

76
 Available seat kilometres (ASKM) in millions Passenger yield in fils per RPKM Geographical revenue in %
THE EMIRATES GROUP
ANNUAL REPORT 17-18 377,060 30.4 29.7
2017-18 16-17 368,102
26.7
24.8 25.3
29.3%
27.9%
Europe
East Asia and Australasia
14.7% Americas
15-16 333,726
10.2% Africa
14-15 295,740 9.4% Gulf and Middle East
8.5% West Asia and Indian Ocean
13-14 271,133 13-14 14-15 15-16 16-17 17-18

Overview Passenger numbers in millions Cargo carried in tonnes ‘000

56.1 58.5 2,623
2,509 2,577
Emirates 51.9 2,377
48.1 2,250
44.5
dnata
Geographical revenue in AED bn
Year Europe East Asia Gulf and West Asia
Group and Middle and Indian
Australasia Americas Africa East Ocean Total
Financial
Information
2017-18 26.7 25.4 13.4 9.4 8.5 7.8 91.2
2016-17 23.9 22.6 12.5 8.7 8.7 7.4 83.8
Emirates
Financial 13-14 14-15 15-16 16-17 17-18 13-14 14-15 15-16 16-17 17-18 % change 12% 12% 7% 8% (2%) 5% 9%
Commentary

dnata
Financial
Commentary

Emirates
Consolidated Passenger revenue and seat factor
Financial
Statements Passenger traffic continued to grow
with an RPKM increase of 5.6%. Further,
dnata
passenger yield at AED 25.3 fils per
Consolidated
Financial RPKM (2016-17: AED 24.8 fils per RPKM)
Statements
grew by 2.0%. Together, these factors
contributed to a strong 8.0% growth
Additional
Information in passenger revenue (including excess
baggage) to AED 74.4bn (2016-17: AED
68.9bn).
With customer service and a higher
quality product at the heart of our
business, seat factor grew to 77.5%
(2016-17: 75.1%). Our ASKMs grew
by 2.4% and reached 377.1bn (2016-
17: 368.1bn). We carried a record
58.5 million (2016-17: 56.1 million)
passengers during the year, an increase
of 4.3% over last year. The premium
class seat factor was up 1.8%pts and the
economy class seat factor increased by
2.4%pts compared to the previous year.
Further, revenues were also boosted by
the full year impact of our prior year
ancilliary offerings including paid seats
and lounge access.
During the year, we entered into a
codeshare agreement with flydubai in
order to leverage existing capabilities
of both airlines and provide more
destination choices to our customers.
Cargo revenue
Cargo revenue touched AED 12.4bn,
an impressive 17.4% increase over the
prior year (2016-17: AED 10.6bn). FTKM
increased by 3.5% to 13.4bn and the
yield per FTKM increased by 13.4%
over the previous year. As a result,
cargo revenue now constitutes 14.3%
of Emirates transport revenue (2016-17:
13.3%).
The increase in belly capacity from
two new passenger destinations was
complemented by three new freighter
destinations during the year. Overall,
cargo volumes increased by 1.8% to
2.6m tonnes in the current year. The
yields benefitted from a weak US Dollar
and improved demand.
During the year, Emirates SkyCargo
entered into a strategic partnership with
Cargolux focusing on freighter aircraft
capacity and connectivity between Dubai
and European points.
Non-transport revenue
Non-transport business mainly
comprises of the sale of consumer
goods, food and beverages, hotel and
catering operations. Non-transport
revenue at AED 4.4bn (2016-17: AED
4.4bn) remained unchanged compared
to the previous year.
Revenue distribution
Emirates continued to benefit from its
strategy of having a diverse revenue
base, with no region contributing more
than 30% of revenues. Europe remains
the largest revenue contributor
at 29.3% of Emirates revenue
(2016-17: 28.5%). Revenue from Europe
and the East Asia and Australasia regions
increased by 12%. Gulf and Middle
East region showed a small decline
due to the ongoing political instability.
Other regions also showed increases in
comparison to the prior year.

77
 Operating costs in AED bn Fuel price and quantity development Employee cost as % of operating costs
THE EMIRATES GROUP 88.2
82.9 82.6 140%
ANNUAL REPORT 78.4 76.7 17-18 15 85
2017-18
Heading heading 130%
120% 16-17 16 84

110%
15-16 16 84
100%
Fuel Price Volume
90% 14-15 14 86
Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar
13-14 14-15 15-16 16-17 17-18 Graph represents % change in average monthly fuel price and quantity in 2017-18 indexed to 2016-17 13-14 13 87

Employee Cost Other operating cost

Overview Jet fuel cost as % of operating costs Operating costs in AED m 2017-18 2016-17 % 2017-18 Unit cost in fils per ATKM
change as % of
Emirates
operating
39 35 26 25 28 cost 162 158
dnata Jet fuel 24,715 20,968 17.9 28.0
132 132 139
Employee 13,080 12,864 1.7 14.8
Group
Aircraft operating leases 11,691 10,509 11.2 13.2
Financial Depreciation and amortisation 9,193 8,304 10.7 10.4 102
Information 97 97 97 98
Sales and marketing 6,404 5,698 12.4 7.3
61 65 74 75 72
Emirates Handling 5,335 5,885 (9.3) 6.0
Financial 13-14 14-15 15-16 16-17 17-18 13-14 14-15 15-16 16-17 17-18
Commentary In-flight catering and related costs 3,323 3,343 (0.6) 3.8
Jet fuel Other operating costs Unit Cost Unit cost excluding jet fuel
Overflying 2,891 2,851 1.4 3.3
dnata
Financial Facilities and IT related costs 2,485 2,470 0.6 2.8
Commentary Aircraft maintenance 2,364 2,738 (13.7) 2.7
Emirates
Landing and parking 2,153 2,057 4.7 2.4
Consolidated
Financial
Expenditure Cost of goods sold 1,575 1,499 5.1 1.8 the addition of 7 aircraft on finance
Statements Operating costs Crew layover 1,125 1,082 4.0 1.3 lease, more staff accommodation
Corporate overheads (including fx loss) 1,902 2,380 (20.1) 2.2 facilities and our new flight training
Operating costs grew by 6.8%, closing
dnata
Total operating costs 88,236 82,648 6.8 100.0 academy, coupled with the full year
Consolidated at AED 88.2bn (2016-17: AED 82.6bn).
Financial impact of last year’s aircraft deliveries.
This increase is higher than the capacity Jet fuel costs remained unhedged during of 23 aircraft taken in the prior year.
Statements
growth of 1.6% measured in ATKMs, the year and we continue to manage our This increase was partially offset by the Sales and marketing costs increased
Additional primarily due to fuel costs which were position by assessing our fuel price risk on phase out of 6 (2016-17: 25) aircraft on by 12.4% and stood at AED 6.4bn
Information
up by 17.9% owing to higher fuel prices, an ongoing basis. completion of lease terms. (2016-17: AED 5.7bn). The upside is
and our ongoing capacity expansion. the result of higher spend on new and
Employee costs Direct operating costs (‘DOC’) upgraded sponsorship contracts and
Despite a spike in jet fuel cost and a
In line with the capacity increase of 1.6%, Direct operating costs including increase in online advertising costs as we
weak US Dollar, Emirates has been
employee costs were up 1.7% at AED handling, in-flight catering, overflying, concluded two major online campaigns
successful in reviewing its cost base
13.1bn (2016-17: 12.9bn). Our employee landing and parking, aircraft i.e., ‘Upgrade your Airline’ and ‘The
and bringing efficiencies which partially
numbers reduced by 3.7%, as this year maintenance and crew layover costs Game Changer’. Further, selling and
reduced these adverse impacts.
our reduced hiring activity, coupled with declined by 4.3%, despite capacity distribution costs accelerated in line with
Jet fuel costs new and innovative ways of working growth and higher activity levels. This the increase in transport revenue.
Jet fuel costs increased to AED 24.7bn gave us gains in productivity and a decline was driven by various cost saving
Unit cost
(2016-17: AED 21.0bn) during the year. slowdown in cost increase. initiatives, a reduction in number of
departures and contract negotiations With the increase in jet fuel prices, unit
Average crude prices soared above USD Aircraft operating leases
across all DOC elements. cost per ATKM increased to 139 fils
60 a barrel during the second half of the
Aircraft operating lease costs increased (2016-17: 132 fils) per ATKM. Unit cost
year, increasing jet fuel expense by 15%, Other operating costs
by 11.2% to AED 11.7bn (2016-17: AED per ATKM excluding jet fuel stands at 98
which together with a higher fuel uplift of
10.5bn). We acquired 10 new aircraft on The increase in depreciation and fils (2016-17: 97 fils) per ATKM.
3%, in line with the increased operations,
operating leases during the year and amortisation charge of 10.7% or AED
resulted in fuel costs per ATKM rising to
were also impacted by the full year effect 889m was predominantly the result of
AED 41 fils (2016-17: AED 35 fils).
78
 Destinations Available tonne kilometres (ATKM) in bn Aircraft departures
THE EMIRATES GROUP and number of aircraft
259 268
ANNUAL REPORT 17-18 157 251 17-18 201,858
2017-18
231
217 60.5 61.4
16-17 156 56.4 16-17 204,543
50.8
15-16 153 46.8 15-16 199,754

14-15 144 14-15 181,843

13-14 142 13-14 14-15 15-16 16-17 17-18 13-14 176,039

ATKM No. of aircraft

Overview A380 aircraft numbers Overall and breakeven load factor in % B777 aircraft numbers

Emirates 17-18 102 17-18 166

67.3 67.2
66.5
dnata 65.5 65.0
16-17 94 16-17 163
64.7
Group
64.9 65.2
15-16 75 64.5 15-16 156
Financial
Information 14-15 59 14-15 144
60.4
Emirates
Financial
13-14 47 13-14 14-15 15-16 16-17 17-18 13-14 134
Commentary
Breakeven load factor Overall load factor
dnata
Financial
Commentary

Emirates
Consolidated
Financial
Capacity, traffic and
Statements load factor
Capacity rose by 1.6% to 61.4bn ATKMs
dnata
Consolidated (2016-17: 60.5bn) resulting from new
Financial
aircraft deliveries. The overall traffic load
Statements
or RTKM growth was 5%, increased to
Additional 41.3bn (2016-17: 39.3bn).
Information
Our enhanced product and increased
demand delivered an improvement in
passenger and cargo volumes during the
year, passengers carried were up 4.3%
at 58.5m (2016-17: 56.1m) and cargo
volumes showed an increase of 1.8%
(2016-17: 2.7%).
The overall load factor increased to
67.2% (2016-17: 65.0%) due to higher
RTKM’s. The break-even load factor
increased moderately to 65.2% (2016-
17: 64.5%) owing to higher unit cost per
ATKM.
During the year, we achieved significant
milestones as we received our 100th
A380 aircraft and welcomed our 20
millionth Skywards member.
We continue to maintain our position
as the largest operator of A380 aircraft
and added another 8 new aircraft into
the fleet. The high seat factor on the
A380 fleet continued to demonstrate the
customer preference for this aircraft and
our product offering. The fleet carried
41% (2016-17: 37%) of our passengers in
2017-18. With current A380 operations
to 48 destinations, 31% (2016-17: 30%)
of all destinations across the Emirates
network are served by an A380.
The B777 aircraft continues to remain
the pillar of our operation. We added 9
Capacity (ATKM)
Load carried (RTKM)
Load factor
Break even load factor
aircraft to the fleet and phased out 6, electronic devices in aircraft cabins which
which brings the total to 166. We remain negatively impacted our customers’
the world’s largest B777 operator and it travel appetite. However, the overall
accounts for 59% (2016-17: 62%) of the passenger numbers showed a growth
airline’s capacity, carrying 59% (2016-17: which was driven by:
61%) of our passengers and 75% (2016-
• Introduction of new passenger
17: 74%) of cargo tonnage.
services to two destinations – Zagreb
We opened our 41st dedicated airport and Phnom Penh, along with the full
lounge in Boston and refurbished year operations of destinations added
lounges in Singapore and Bangkok in the prior year in the Far East and
airports. Americas.
The aircraft departures dropped by 1.3% • Higher frequencies to several existing
to 201,858 (2016-17: 204,543) due to destinations including Brussels,
the ongoing political instability in the Brisbane, Bali, Lagos, Algiers, Cairo,
Middle East and reduced services to the Khartoum and Dammam.
US this year owing to restrictions on
• Increased capacity to existing
destinations with larger aircraft
2017-18 2016-17 % change mainly Madrid, Shanghai, Beijing,
million 61,425 60,461 1.6 Birmingham, Moscow, Frankfurt
million 41,250 39,296 5.0 and Haneda.
% 67.2 65.0 2.2 pts
• New A380 services to Nice.
% 65.2 64.5 0.7 pts

79
 Fleet and other capital expenditure in AED bn
THE EMIRATES GROUP 19.1
ANNUAL REPORT 17.8
2017-18
Heading heading 14.7
10.6

Assets in AED bn Equity and liabilities in AED bn

127.6 7.4
127.6
121.6 121.6

37.0 2.0 2.1 2.0 2.0 1.1

35.1 13-14 14-15 15-16 16-17 17-18
66.5 Fleet capital expenditure Others
67.5

Overview Equity in AED bn and dividend payout

50.0 in % of profit
48.1 37.0
Emirates 35.1
Aircraft, engines and parts 32.4
26.9 28.3
dnata 25.5
26.2 Other non-current assets Equity
Group
Cash assets Non-current liabilities 48%
Financial 20.4 15.7 40.6 38.4 29% 36%
25%
Information Current liabilities
Other current assets 0%
13.8 12.2
Emirates
Financial 17-18 16-17 17-18 16-17 13-14 14-15 15-16 16-17 17-18
Commentary
Equity Divident payout
dnata Assets in AED bn 2017-18 2016-17 change % change
Financial
Commentary Aircraft, engines and parts* 66.5 67.5 (1.0) (1.5)
Other non-current assets 26.9 26.2 0.7 2.7
Emirates
Consolidated Statement of financial position Cash assets 20.4 15.7 4.7 30.0 AED 1bn. The equity ratio remained
Financial
Statements Other current assets 13.8 12.2 1.6 13.1 stable at 29% compared to the last
Assets financial year.
Total 127.6 121.6 6.0 5.0
dnata Emirates balance sheet continued
Consolidated *includes aircraft pre-delivery payments The dividend pay-out ratio stood at 36%
Financial
to remain strong, with total assets
Statements increasing by 5% to AED 127.6bn (2016-17: Nil) and brings the average
(2016-17: AED 121.6bn). Capital expenditure The airline is also continuously investing pay-out ratio over the past five years to
Additional
Capital expenditure of AED 8.5bn (2016- in new technologies in its quest to 28%.
Information We continued to enhance our service
17: 12.6bn) is 32.7% lower compared to enhance our customers’ experience Liabilities
through investments in new aircraft and bring efficiencies across business
the previous year driven by a reduction
and cabin interiors. During the year, processes. Our capital projects in Total liabilities were up 4.7% at AED
in on-balance sheet aircraft deliveries.
we launched new cabin products for progress include various such initiatives. 90.6bn (2017: AED 86.5bn) due to the
We obtained six Boeing 777s and one
our 777 fleet and refreshed on-board funds received from Sukuk financing,
A380 on finance lease (2016-17: 12
lounges for A380s. Other non-current Equity higher passenger and cargo sales in
aircraft) during the year. Primary capital
assets increased due to investments Total equity rose by 5.6% to AED 37.0bn advance and addition of the dividend
expenditure comprising of aircraft
in employee accommodation facilities, (2016-17: 35.1bn) due to higher profit liability mitigated partly by repayments
spend, aircraft and engine maintenance
our newly inaugurated flight training for the year which was partially offset of borrowings and lease liabilities.
overhauls, spare engines and parts
academy and major maintenance by dividend to the Owner amounting to
represented 87% of the total capital
overhauls. Further, advance lease rentals
expenditure (2016-17: 84%).
increased as 10 aircraft (2016-17: 23)
were obtained on operating lease. We Secondary capital expenditure amounted
also opened our 41st dedicated airport to AED 1.1bn (2016-17: AED 2.0bn), Equity and liabilities in AED bn 2017-18 2016-17 change % change
lounge in Boston. of which the majority was invested in Total equity 37.0 35.1 1.9 5.6
airport lounges, training facilities and Non-current liabilities 50.0 48.1 1.9 3.9
Current assets soared by 22.8% due to
staff accommodation. We also started
increased cash assets of AED 20.4bn at Current liabilities 40.6 38.4 2.2 5.7
receiving trainer aircraft for our ab-initio
31 March 2018 (2016-17: AED 15.7bn). Total 127.6 121.6 6.0 5.0
80 pilot training.
 Cash generated from operating activities Cash assets in AED bn and Cash assets to Operating cash margin in % EBITDAR and debt service in AED bn
THE EMIRATES GROUP in AED bn total revenue in % 19
ANNUAL REPORT 14.1 14.1 16 17
12.6 13.3
2017-18 10.4 16.9
20.0 20.4
16.6
12 13
16.6 15.7 15.3 24.4 25.0 23.5
20.3 21.2 21.8
15.3 17.2
24% 14.9 14.4 15.1
22% 12.8
20% 19% 18%
12.3

13-14 14-15 15-16 16-17 17-18 13-14 14-15 15-16 16-17 17-18 13-14 14-15 15-16 16-17 17-18 13-14 14-15 15-16 16-17 17-18
Cash assets Cash assets to revenue EBITDAR Debt service No. of months

Overview Cash flow in AED bn EBITDAR margin in %

3.0
Emirates
28.7
14.1 6.4 27.0
dnata

20.4 25.0
Group
15.7
22.8
Financial 20.8
Information Cash assets Net cash Net cash Net cash Cash assets
net of bank generated from used in used in net of bank
Emirates overdrafts operating investing financing overdrafts
Financial as at 31 Mar 17 activities activities activities as at 31 Mar 18 13-14 14-15 15-16 16-17 17-18
Commentary

dnata
Financial
Commentary

Emirates
Consolidated
Financial
Cash position Cash from operating activities investments needed for our growth and operating profit and is at record level
Statements After a reduction last year, our cash strategy. of AED 25.0bn, 17.5% better than last year.
Cash assets generation from operating activities
dnata
With a higher growth in cash generated EBITDAR after debt service payments
Consolidated
After a reduction last year, our cash bounced back by showing a growth of from operating activities compared to stood strong at AED 1.5bn, and equated
Financial assets including short term bank 35.6% and reached a new record level growth in revenue, the operating cash to 13 months of debt service payments
Statements deposits are at AED 20.4bn (2016-17: at AED 14.1bn (2016-17: AED 10.4bn). margin stands high at 15.3% (2016-17: including operating lease rentals, periodic
Additional
15.7bn). This represents surplus funds This was due to higher profits and better 12.3%). principal and interest payments on finance
Information left after meeting financial obligations working capital management. leases, bonds and term loans.
and investment requirements. The
proceeds from Sukuk financing of USD We continued to generate sizable cash EBITDAR EBITDAR margin at 27% (2016-17: 25%)
600m (AED 2.2bn) issued in the last flows from operations which are not only Cash profit from operations (EBITDAR) for the year is 2%pts up compared to
quarter of the financial year have been sufficient to service financial obligations grew considerably due to higher revenues last year.
invested in short term bank deposits and but also available to partly fund the
will be used to finance aircraft deliveries
in 2018-19. 2017-18 2016-17 2015-16 2014-15 2013-14
The cash assets to revenue and other EBITDAR in AED bn 25.0 21.2 24.4 20.3 17.2
operating income ratio has significantly Less: Debt service payments
grown to 22.1% (2016-17: 18.4%) and Repayment of bonds and loans (4.0) (5.6) (1.7) (0.6) (2.5)
is well within our target range of 25%
Repayment of lease liabilities (6.5) (4.4) (4.1) (5.6) (2.7)
+/- 5%.
Operating lease rentals (11.7) (10.5) (8.1) (6.9) (6.5)
Finance costs (1.3) (1.3) (1.2) (1.3) (1.1)
Total (23.5) (21.8) (15.1) (14.4) (12.8)

EBITDAR after debt service payments 1.5 (0.6) 9.3 5.9 4.4
81
 Sources of funding over last 10 years in %
THE EMIRATES GROUP
ANNUAL REPORT

2017-18
Heading heading
52% Operating Lease Fleet information (as at 31 March 2018)
23% Commercial Financing Aircraft Fleet of which of which Future deliveries Additional options
16% EXIM/ECA Guaranteed Financing on operating on
lease finance Authorised Authorised Authorised Authorised
7% Bonds & & not & & not
lease/loan contracted contracted contracted contracted
2% Islamic Financing
A 380-800 102 58 44 40 20 - 16
B 777-300ER 138 78 60 12 - - -
B 777-200LR 10 4 6 - - - -
B 777-300 5 5 - - - - -
Overview Number of aircraft Average fleet age in months B 777-8X - - - 35 - - -
268
259 17-18 68 B 777-9X - - - 115 - 50 -
Emirates 251
231 B 787-10 - - - - 40 - -
dnata 16-17 63
217 Passenger 255 145 110 202 60 50 16
Group
15-16 74 B777-200LRF 13 13 - - - - -
Financial Freighters 13 13 - - - - -
Information 14-15 75
Total aircraft 268 158 110 202 60 50 16
Emirates Note: One A319 aircraft is used for Executive jet charters
Financial 13-14 14-15 15-16 16-17 17-18 13-14 74
Commentary

dnata
Financial
Commentary

Emirates
Consolidated
Financial
Aircraft fleet and financing
Statements
In alignment with our commitment to
maintain a young, modern and efficient
dnata
Consolidated fleet, Emirates took delivery of 17 wide
Financial
body aircraft, consisting of 9 B777-
Statements
300ERs from Boeing and 8 A380s from
Additional Airbus and simultaneously retired eight
Information
of our older aircraft during the financial
year. Emirates remains the world’s largest
B777 operator with 166 aircraft. The
airline is also the largest A380 operator
with 102 twin deck units in its fleet.
We take extreme pride in keeping our
fleet age to 68 months (2016-17: 63
months), substantially lower than the
industry average. We are the first and
only airline in the world to operate an
all Airbus A380 and Boeing B777
wide-body fleet.
During the year, Emirates raised a total
of AED 17.9bn (2016-17: AED 29.1bn)
in aircraft financing (funded through
finance leases, operating leases and
term loans) and has already received
82
committed offers to finance all deliveries
due in the forthcoming financial year.
The ability to secure diverse sources of
funding from international markets for
aircraft financing and other investments
is a testament to our financial
strength and track record of business
performance.
Emirates, working closely with the
financial community, has built on
and further developed the Japanese
structured financing market for the
Japanese Operating Lease with a Call
Option (JOLCO) on B777-300ER aircraft
raising funding totalling up to AED 3.7bn
(USD 1.0bn) during the year. Blending
this important equity base with debt
from wide-ranging markets including
China, France, the United Kingdom,
Singapore, Germany, Korea, Netherlands
and Japan; Emirates has now raised
over AED 23.9bn (USD 6.5bn) from the
Japanese structured financing market
since 2014.
We have successfully refinanced and
are in the process of terming out a
commercial bridge facility (initially put
in place due to non-availability of ECA
cover) of AED 3.8bn (USD 1.0bn) via an
innovative finance lease structure for five
A380 aircraft, accessing an institutional
investor and bank market base from
Korea, Germany, the United Kingdom
and the Middle East.
In March 2018, Emirates successfully
issued a ten-year, USD 600m (AED 2.2bn)
amortising Sukuk, an Islamic bond.
The funds will be utilised for two A380
deliveries in the upcoming financial year.
Emirates’ strength of operations and
cash flow generation underscore the
consistent ability to meet obligations
in a timely manner including the
repayment of AED 2.8bn (USD 776m)
or 44% of the AED 6.4bn (USD 1.75bn)
amortising senior unsecured corporate
bond and Sukuk issued in 2013. Since
2010, Emirates has repaid in total AED
14bn (USD 3.8bn) towards capital
markets issuances including scheduled
repayments of amortizing capital
markets issuances as well as the UK
Export Finance backed Sukuk.
Further, we also have access to standby
bilateral credit facilities to the tune of
USD 500m which are available for short
term financing requirements.
We continue to repay our financing
liabilities as they become due from our
cash resources.
Having raised more than AED 183.8bn
(USD 50.1bn) over the last 10 years,
Emirates continues to maintain a well-
diversified and evenly spread financing
portfolio. Tapping into various sources of
funding, both in terms of structure and
geography, Emirates remains On Course
with its long term financing strategy.
Augmenting our resolve to maintain
one of the world’s youngest fleet, we
will receive 16 new aircraft deliveries
and retire 11 older aircraft in the next
financial year.
 Debt repayment profile in AED bn Debt collateralization in AED bn

127.6
THE EMIRATES GROUP

121.6
119.2
ANNUAL REPORT

111.4
13.3

2017-18

101.6
3.3

86.9

86.0
82.8
80.5
9.0

71.6
1.4 7.0
6.5

50.1

51.0

51.1
47.8
5.7

42.4
1.4 1.4 5.1
1.2 4.5 10.0
7.6 1.2 0.9
5.1 5.6 4.5 3.9 3.6

18-19 19-20 20-21 21-22 22-23 23-24 >23-24 13-14 14-15 15-16 16-17 17-18
Lease liabilities Bonds and term loans Total assets Property, plant and equipment Total debt

Overview Net debt (including aircraft operating 450.00

Net debt (including aircraft operating Net debt (including aircraft operating Effective interest rate on borrowings
leases) to equity ratio in % leases) to EBITDAR ratio in % leases) and cash assets in AED bn and lease liabilities in %
Emirates 80.2
406.25 392.9 83.5
237.9 70.0
dnata 3.3
60.0
209.9 212.1 362.50 53.5 3.2
Group
215.9 216.4
318.75 310.3 3.2
Financial 321.0
Information 3.1
275.00 296.2
286.5 16.6 16.9 20.0 15.7 20.4 3.0
Emirates
Financial 13-14 14-15 15-16 16-17 17-18 13-14 14-15 15-16 16-17 17-18 13-14 14-15 15-16 16-17 17-18 13-14 14-15 15-16 16-17 17-18
Commentary
Net debt Cash Assets
dnata
Financial
Commentary

Emirates
Consolidated
Financial
Debt
Statements
Emirates total borrowing and lease
dnata liabilities remained stable compared
Consolidated to the previous year at AED 51.1bn
Financial
Statements (2016-17: AED 51.0bn). The non-current
portion of AED 42.1bn (2016-17: 40.2bn)
Additional
represents 84% (2016-17: 84%) of the
Information
total non-current liabilities while the
current portion of AED 9.0bn (2016-17:
AED 10.8bn) represents 22% (2016-17:
28%) of the total current liabilities.
Total borrowing and lease liabilities
moved as a result of financing seven new
aircraft and the Sukuk issue of US Dollar
600m, offset by repayments of finance
lease liabilities, bonds and term loans.
The ratio of total borrowings and lease
liabilities to total equity improved to
137.9% (2016-17: 145.3%) due to an
increase in equity.
The net debt including aircraft operating
leases to equity ratio dropped to 216.4%
(2016-17: 237.9%) due to increased cash
assets and higher equity.
Net debt to EBITDAR ratio
The net debt including aircraft operating
leases to EBITDAR ratio decreased to
321.0% (2016-17: 392.9%) as a result of
increase in EBITDAR and cash assets.
Debt service
Debt service payments, excluding
operating leases, represent loans,
bonds, finance lease liabilities and the
related finance costs payments. During
the year, these payments amounted to
AED 11.8bn (2016-17: AED 11.3bn) up
by 4.8% or AED 0.5bn. This rise in debt
service payments is primarily attributable
to higher lease liability payments.
Debt maturity profile Interest rate and currency risk
We aim to achieve a stable repayment
Interest rates
profile by obtaining debt with periodic
instalments as opposed to bullet With our ongoing fleet acquisition, we
payments. This enables us to manage continue to use natural hedges and
debt servicing through our operating other prudent hedging solutions such
cash flows and the use of the surplus as swaps to manage our interest rate
cash for investment purposes. As at the exposures. We target a risk-managed
balance sheet date, all of the debt is portfolio approach, whilst taking
amortising in nature. advantage of market movements, with
a long-term view of hedging around
Debt collateralisation half of our interest rate risk exposures.
Of the total debt of AED 51.1bn, 88% Borrowings and lease liabilities (net of
or AED 45.1bn (2016-17: AED 45.4bn) cash) including the off balance sheet
is secured against property, plant and aircraft on operating lease at 31 March
equipment. The remaining debt of AED 2018, comprise 72% on a fixed interest
6.0bn (2016-17: AED 5.6bn) is adequately rate basis with the balance 28% on
covered against the carrying value of floating interest rates.
unencumbered assets (property, plant
At 31 March 2018, borrowings and lease
and equipment) amounting to AED
liabilities carry an effective interest rate
27.1bn (2016-17: AED 28.8bn).
of 3.2% (2016-17: 3.0%).

83
 Currency development Graph represents the monthly % change of our six major Capacity per airline employee in ATKM ‘000 Revenue per airline employee in AED ‘000
THE EMIRATES GROUP currency rates compared with previous year (2016-17)
ANNUAL REPORT 25% 17-18 1,235 17-18 1,784
2017-18
Heading heading
20%

15%
16-17 1,171 16-17 1,580

15-16 1,174 15-16 1,717

10%

5% 14-15 1,141 14-15 1,939

0% 13-14 1,129 13-14 1,938

-5%

-10%
Overview ZAR INR AUD EUR GBP CNY Employee strength (in numbers) 2017-18 2016-17 % change
-15% UAE
Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar
Emirates
Geographical work force including subsidiaries in % Cabin crew 23,135 24,440 (5.3)
dnata Flight deck crew 4,157 4,169 (0.3)
Group
Engineering 3,374 3,392 (0.5)
Others 13,189 13,771 (4.2)
Financial 89%
Information UAE Total UAE 43,855 45,772 (4.2)
Overseas stations 5,885 5,856 0.5
Emirates 11%
Financial Total Airline 49,740 51,628 (3.7)
Commentary Overseas

dnata Subsidiary companies 12,616 13,140 (4.0)

Financial
Commentary Average employee strength 62,356 64,768 (3.7)

Emirates
Consolidated
Financial
Currency
Statements We generate a substantial net surplus in
Euro, Pound sterling, Australian dollar,
dnata
Consolidated Indian rupee, Chinese yuan, Swiss franc,
Financial South African rand and Japanese yen.
Statements
We proactively manage the currency
Additional exposure generally over a period up
Information to 12 months depending on market
conditions by using prudent hedging
solutions including forward contracts,
currency swaps and natural hedges.
The foreign currency graph depicts
the percentage change in average
monthly currency rates of our six major
currencies compared with previous year.
There is clear upward trend in exchange
rate variations this year. South African
rand (ZAR) and Euro substantially
strengthened against the UAE dirham,
whereas Pound sterling (GBP) showed
maximum volatility during the year.
Although the remaining three currencies
showed a marginal improvement from
84
last year, the revenue growth was sizable Employee strength and The airline’s employee productivity
considering the underlying revenues productivity related key performance indicators
generated in these currencies. improved as follows:
The average workforce dropped by 3.7%
The movements in exchange rates • Revenue per airline employee rose to
to 62,356.
compared to the previous financial year AED 1,784 thousand (2016-17: AED
had an overall positive impact of AED The average number of employees in 1,580 thousand), a 12.9% increase due
0.7bn on Emirates operating results the airline decreased by 1,888 or 3.7% to growing core revenues.
(2016-17: adverse AED 2.1bn). to 49,740. Employee count has dropped
across all segments, the largest part of • Capacity per airline employee is up
The six major currencies account for the drop coming from our cabin crew. 5.5% at 1,235 thousand ATKM (2016-
circa 44% (2016-17: 43%) of transport This is mainly through a recruitment 17: 1,171 thousand ATKM) due to a
revenue while US Dollar, AED and other slowdown, natural attrition arising 1.6% increase in capacity and a 3.7%
Gulf currencies pegged to the US Dollar drop in airline employee count.
from retirements and resignations
account for another 35% (2016-17: 36%) and new ways of working driven by • The load carried per airline employee
of transport revenue. technology, better processes and people improved to 829 thousand RTKM
management. (2016-17: 761 thousand RTKM) due
Currency average rate (in AED) to a 5% upside on overall load carried
Overseas stations remained almost flat
2017-18 2016-17 % change and a drop was noted in the subsidiary complemented by a drop in airline
companies employee count compared employee count.
ZAR 0.286 0.263 8.7
to the prior year due to shift in strategy
INR 0.057 0.055 3.6
towards outsourced blue collar positions.
AUD 2.846 2.763 3.0
EUR 4.325 4.017 7.7
GBP 4.907 4.784 2.6
CNY 0.557 0.545 2.2
THE EMIRATES GROUP
ANNUAL REPORT

2017-18

Overview

Emirates

dnata

Group

Financial
dnata
Information

Financial
Emirates
Financial
Commentary

dnata
Financial
Commentary

Emirates
Consolidated
Financial
Statements

dnata
Consolidated
Financial
Statements
C O M M E N TA R Y
Additional
Information

85
 Profit attributable to the Owner in AED m Profit margin in % Total revenue trend in AED bn Geographical revenue in %
THE EMIRATES GROUP 1,317 13.1
ANNUAL REPORT 1,210 12.2
2017-18 906
1,054 11.0
9.2
10.6 50 66 64 66 68
829 7.6
10.1

9.9 9.9 9.9

50 34 36 34 32
13-14 14-15 15-16 16-17 17-18 13-14 14-15 15-16 16-17 17-18 13-14 14-15 15-16 16-17 17-18 13-14 14-15 15-16 16-17 17-18
International UAE

Overview Operating profit in AED m Operating margin in % Return on shareholder’s funds in % Acquisitions in AED m
664
1,224 1,196
Emirates 11.4
1,005 1,061 11.0 545
dnata 863
10.0 20.7 20.3
10.0 338
Group

Financial 19.1 19.2 19.3

Information 114
9.1
12
Emirates
Financial 13-14 14-15 15-16 16-17 17-18 13-14 14-15 15-16 16-17 17-18 13-14 14-15 15-16 16-17 17-18 13-14 14-15 15-16 16-17 17-18
Commentary

dnata
Financial
Commentary

Emirates
Consolidated dnata has yet again delivered a robust
Financial
Statements performance, setting new benchmarks
by hitting record levels of revenue,
dnata profits and cash reserves. Each of our
Consolidated
Financial four core business divisions – UAE
Statements airport operations, international airport
operations, travel services and catering -
Additional
Information showed solid growth in revenues.
This strong performance keeps us
‘On Course’ with our mission to become
the most admired air-services provider
in the world. Our focus on quality,
safety, people, customers and driving
efficiencies across all our businesses
in costs, processes, and resources is
reaping good results.
Total revenues crossed the AED 13bn
mark (nearly doubled in the last six
years) and stood at AED 13.1bn (2016-
17: AED 12.2bn), the profit attributable
to the Owner surpassed AED 1.3bn
(2016-17: AED 1.2bn) and cash assets
surged to AED 4.9bn (2016-17: AED 3.4bn).
dnata continued with its two-pronged
growth strategy of international
86
acquisitions, which bring value to its
core operations, and organic expansion.
During the year, our global network
saw significant contract wins mainly in
the ground handling and catering lines
of business. Further, we entered into
new markets, launched new brands and
renewed existing partnerships.
Acquisitions and investment
held for sale
In May 2017, we expanded our reach
in the US cargo market with a 100%
acquisition of ALX Cargo Center IAH
LLC (‘AirLogistix’) with a state-of-the-art
cargo handling centre at George Bush
Intercontinental Airport in Houston.
In September 2017, our Travel business
acquired Destination Asia by gaining
100% ownership in its Singapore
operations and a 25% beneficial interest
in companies across seven other
countries with an option to buy the
remaining interest in future.
In February 2018, we announced the
intent to divest our minority stake in
Hogg Robinson Group Plc (HRG) as part
of HRG’s global acquisition by American
Express GBT. We continue to partner
with HRG in the Middle East and West
Asia where strong synergies have been
developed over the past decade for our
corporate customers.
Profitability
Profit attributable to the Owner and
profit margin
The profit attributable to the Owner for
2017-18 crossed AED 1.3bn (2016-17:
AED 1.2bn), up 8.8% over the previous
year. dnata’s UAE and International
airport operations contributed
significantly to this year’s profit growth.
The profit margin improved by 0.2%pts
compared to previous year and stood at
10.1% (2016-17: 9.9%).
Return on shareholder’s funds
The return on shareholder’s funds is
19.3% (2016-17: 20.3%) and represents a
healthy return on equity.
Operating profit and margin
Operating profit remained stable at
AED 1.2bn (2016-17: AED 1.2bn). The
operating margin reduced by 0.9%pts
to 9.1% (2016-17: 10.0%) due to volatile
trading conditions in the travel and
aviation industry.
Total revenue
dnata’s total revenue grew by 7.3% or
AED 0.9bn to AED 13.1bn (2016-17: AED
12.2bn).
All major lines of business recorded an
increase in revenue, the highest growth
of 14.3% or AED 0.5bn was achieved by
International airport operations resulting
from expansion in new markets and
contract wins at existing locations.
The share of geographic revenue from
operations outside the UAE continues to
grow and stands at 68% (2016-17: 66%).
This is consistent with dnata’s strategy
to grow the international businesses in a
sustainable manner and further diversify
its customer base.
 Revenue by Line of Business Catering Travel services
THE EMIRATES GROUP - Meals uplifted number in millions - Total Transaction Value (TTV) in AED bn
ANNUAL REPORT
Revenue in AED m 2017-18 2016-17 % change % of total 17-18 55.7 17-18 11.3
2017-18 International airport operations 3,803 3,328 14.3 29.4
16-17 60.7 16-17 10.7
Travel services 3,384 3,136 7.9 26.2
UAE airport operations 3,153 3,023 4.3 24.4 15-16 57.1 15-16 11.7
Catering services 2,146 2,010 6.8 16.6
14-15 57.7 14-15 9.8
Other services 445 485 (8.2) 3.4
Total 12,931 11,982 7.9 100.0 41.3 5.9
13-14 13-14

Overview International airport operations International airport operations UAE airport operations UAE airport operations
- Aircraft handled - Cargo handled - in tonnes ‘000 - Aircraft handled - Cargo handled - in tonnes ‘000
Emirates
17-18 448,553 17-18 2,352 17-18 211,038 17-18 731
dnata
16-17 407,915 16-17 2,130 16-17 215,696 16-17 714
Group
15-16 178,228 15-16 1,367 15-16 211,184 15-16 689
Financial
Information 109,546 937
14-15 14-15 14-15 188,752 14-15 734
Emirates
Financial 13-14 104,070 13-14 812 13-14 184,265 13-14 792
Commentary

dnata
Financial
Commentary

Emirates
Consolidated International airport operations
Financial
Statements International airport operations remains
the largest business segment by revenue
dnata
in dnata. It recorded revenues of AED
Consolidated
Financial 3.8bn (2016-17: AED 3.3bn). This growth
Statements
is a result of integrating our sizeable new
businesses acquired during the previous
Additional
Information year, leveraging our global network and
winning new contracts. The appreciation
of Euro, Australian dollar and Brazilian
real against the US dollar also contributed
positively to the revenue growth.
During the year, new cargo facilities were
opened in Dallas and Adelaide whilst
cargo handling capacity was enlarged at
London Gatwick. dnata’s aircraft cabin
cleaning services provider in Australia
scaled up operations in Perth. Further,
new ground handling operations were
established at Singapore Changi Airport
Terminal 4 and new marhaba lounges
were also opened in Karachi and
Melbourne.
Growth in terms of aircraft handled was
10% to 448,553 (2016-17: 407,915). The
main drivers for this increase were new
contract wins, primarily in the US, Brazil
and Italy. During the year, dnata won or
extended over 90 contracts with new and
existing customers.
Cargo tonnage handled grew by 10.4%
to 2,352 thousand tonnes (2016-17: 2,130
thousand tonnes) driven by new contracts
and a global upturn in air cargo volumes.
Travel services
Travel services revenue increased by
7.9% to AED 3.4bn (2016-17: AED 3.1bn)
primarily driven by growth in trading
volumes in our UK businesses despite
challenging market conditions.
The underlying travel services related
turnover measured in Total Transaction
Value (TTV) increased by 5.6% to AED
11.3bn (2016-17: AED 10.7bn).
Our travel business in the UK accounts for
83% (2016-17: 84%) of the revenue from
travel services.
Our cruise business, Imagine Cruising,
expanded in Australia where our product
offering was well-received. We officially
launched our Yalago bed-bank to third
parties. New corporate wins in Dubai and
the launch of the Emirates Holidays brand
in the US, Ireland and China neutralized
our challenges as international security
threats continued to dampen demand,
particularly for short-haul travel in Europe.
UAE airport operations
UAE airport operations recorded revenues
of AED 3.2bn (2016-17: AED 3.0bn).
The 4.3% growth primarily relates to
ground handling operations at Dubai
International Airport (DXB) with the
introduction of several new services from
the current year. Our marhaba service
offering continued its growth trend with
passenger numbers handled up by 13%
compared to the previous year.
Cargo volumes handled increased by
2.3% to 731 thousand tonnes.
The number of aircraft handled at both
the Dubai airports was 211,038 (2016-17:
215,696), a decrease of 2.2% compared
to previous year, mainly due to the
termination of flights between Dubai
and Qatar.
Catering
Revenue from catering activities increased
by 6.8% to AED 2.1bn (2016-17: AED
2.0bn) due to strong business growth in
Australia, Romania, Czech Republic and
Sharjah. This increase was partly offset by
reduced volumes in Italy and UK, mainly
due to the loss of business from certain
customers facing financial difficulties.
We enhanced our operations in
Australia and Ireland with the opening
of a new state-of-the-art catering hub
at Melbourne airport and opening of a
second catering facility at Dublin airport.
Meals uplifted during the financial year
are down by 8.3% to 55.7m (2016:17
60.7m) primarily due to changes in the
airline catering product mix. This was
mitigated by higher yields per meal.
87
 Operating costs in AED bn Operating costs in %
THE EMIRATES GROUP 11.9 42.6% Employee
ANNUAL REPORT 11.0 18.0% Travel services direct costs
2017-18 8.2
9.6
10.9% Airport operations direct costs
6.7
7.1% In-flight catering direct costs
5.8% Rental and lease expenses
3.7% Depreciation and amortisation
3.2% Sales and marketing expenses
1.8% Information technology infrastructure costs
5.9% Corporate overheads
13-14 14-15 15-16 16-17 17-18 1.0% Other direct costs

Overview Employee cost as % of operating costs Operating costs in AED m 2017-18 2016-17 % change 2017-18
% of
Emirates 17-18 43 57 operating
costs
dnata 16-17 42 58 Employee costs 5,055 4,654 8.6 42.6
Group Direct costs
15-16 40 60
- Travel services 2,135 1,913 11.6 18.0
Financial
Information 14-15 41 59 - Airport operations 1,293 1,138 13.6 10.9
- In-flight catering 843 794 6.2 7.1
Emirates
Financial
13-14 48 52
- Other 130 141 (7.8) 1.0
Commentary
Employee costs Other operating costs Rental and lease expenses 688 627 9.7 5.8
dnata Depreciation and amortisation 440 423 4.0 3.7
Financial
Commentary Sales and marketing expenses 381 370 3.0 3.2
Information technology infrastructure costs 210 204 2.9 1.8
Emirates
Consolidated Expenditure Corporate overheads 703 694 1.3 5.9
Financial
Statements Total operating costs 11,878 10,958 8.4 100.0
dnata’s operating costs were up 8.4%
dnata at AED 11.9bn (2016-17: AED 11.0bn).
Consolidated The increase is commensurate with the Direct costs With the international expansion of based concession fees in Sharjah and
Financial
organic revenue growth in all existing Direct costs at AED 4.4bn are 10.4% Airport operations, direct costs increased Romania and the expansion of US airport
Statements
lines of business, investments in new higher than the previous year (2016-17: by 13.6% to AED 1.3bn (2016-17: AED operations also contributed to the hike
Additional and enhanced facilities and integrating AED 4.0bn). 1.1bn). in costs.
Information
the newly acquired companies in the In-flight catering related direct costs Depreciation and amortisation
The growth in our UK travel portfolio
previous and current year. The increase is at AED 843m (2016-17: AED 794m) cost stood at AED 440m (2016-17:
particularly Emirates Holidays and
further contributed by a depreciating US increased by 6.2% over the previous AED 423m), up 4.0% resulting from
brands forming part of Stella have
dollar against the major currencies. year due to the increased operations in investments made in ground handling
substantially contributed to the increase
of 11.6% in direct costs for travel Australia, Romania, Czech Republic and and catering facilities. Corporate
Employee costs Sharjah offset by a fall in business in the overheads at AED 703m (2016-17: AED
services. These costs include the cost
Employee costs, being the largest UK and Italy. 694m) are up 1.3% resulting primarily
for travel packages sold where dnata
element of dnata’s cost base, stood at from provisions taken for receivables
acts as the principal in a transaction and
43% of operating costs (2016-17: 42%). Other operating costs from customers facing financial
recognises revenue on a gross basis.
Employee costs increased by 8.6% to The increase in rentals and lease difficulties.
AED 5.1bn (2016-17: AED 4.7bn), as a expenditure of 9.7% at AED 688m
result of opening new ground handling, (2016-17: AED 627m) was driven by the
cargo and catering facilities. new kitchen facilities in Melbourne and
Dublin. Further, increases in revenue

88
THE EMIRATES GROUP
ANNUAL REPORT

2017-18 Assets in AED bn Equity and liabilities in AED bn

Assets in AED m 2017-18 2016-17 change % change
14.3 14.3 PPE, investment properties and
intangible assets 4,987 4,716 271 5.7
Other non-current assets 731 656 75 11.4
12.0 12.0
5.0 Cash assets 4,945 3,398 1,547 45.5
7.3 Other current assets* 3,629 3,277 352 10.7
4.7 Total 14,292 12,047 2,245 18.6
0.7 *including asset classified as held for sale
6.7
0.6 PPE, investment
Overview properties and
intangible assets 1.7
5.0
Emirates 3.4 Equity and liabilities in AED m 2017-18 2016-17 change % change
Other non- 1.5 Equity
dnata current assets Equity 7,282 6,706 576 8.6
Cash 5.3 Non-current Non-current liabilities 1,734 1,542 192 12.5
Group 3.6 assets 3.8 liabilities
3.3 Current liabilities 5,276 3,799 1,477 38.9
Other current Current
Financial assets liabilities Total 14,292 12,047 2,245 18.6
Information
17-18 16-17 17-18 16-17
Emirates
Financial
Commentary

dnata
Financial
Commentary

Emirates
Consolidated
Financial
Statement of financial position
Statements
Assets
dnata
Total assets grew by 18.6% or AED 2.3bn
Consolidated
Financial to AED 14.3bn.
Statements
Net investment in property, plant and
Additional equipment are marginally up by 0.8%
Information
to AED 1.9bn (2016-17: AED 1.8bn).
dnata’s International airport operations
division opened a new maintenance
base at Singapore airport in July 2017
and invested in new ground support
equipment in Dubai and the Americas.
New kitchens in Melbourne and Dublin
were opened in the current year to
enhance service offerings in catering.
Through Transecure, its fully-controlled
subsidiary, dnata invested over AED
100m in new accommodation facilities
leased to external parties.
Intangible assets increased by 5.9%
to AED 2.8bn (2016-17: AED 2.6bn).
Goodwill continues to form the
largest portion of the intangible asset
portfolio at 74% (2016-17: 73%) which
is validated on an annual basis through
impairment testing. A weak US Dollar
has increased the intangible asset base
by AED 169m. dnata continues to invest
in the latest technology to stay ahead
of its competition. During the year,
significant investments were made in
cyber security related applications. Our
travel division implemented a global
telephony project to seamlessly connect
its global operations and to provide
enhanced customer experience. The
acquisition of AirLogistix also resulted in
AED 14m higher goodwill and customer
relationships.
Investments accounted for using the
equity method (including those classified
as held for sale) stand at AED 519m
(2016-17: AED 407m) and increased due
to better returns on these investments
for the year.
Trade and other receivables, increased
by AED 300m or 9.0% compared to
2016-17, resulting from the organic
growth across all business lines and
slower collections in Plafond, our fit-out
business.
Equity
Total equity at AED 7.3bn (2016-17:
AED 6.7bn) reflects a growth of 8.6%
over last year, which increased due to
record profits for the year offset by a
record AED 1bn dividend declared to
the Owner.
Liabilities
Borrowings and lease liabilities have
increased by 16.7% to AED 1.2bn
(2016-17: AED 1bn) due to loans taken
for the new accommodation facilities
in Dubai and to meet working capital
requirements in the UK. A weak US dollar
has also impacted the balance.
Trade and other payables stood at AED
5.0bn (2016-17: AED 3.5bn), an increase
of 41.4% due to the dividend declared
to the parent of AED 1bn, and increased
ground handing, travel and catering
operations.

89
 Free cash flow in AED m Operating cash margin in % Cash flow in AED m
THE EMIRATES GROUP

1,858
ANNUAL REPORT
1,858
2017-18 413 78

1,445
1,390

1,281
1,125

1,068
1,058
4,872
14.2 3,266

893
13.1
14.9

355
11.6

206
10.5 Cash assets Net cash Net cash Net cash Cash assets
net of bank generated used in generated from net of bank
overdrafts from operating investing financing overdrafts
13-14 14-15 15-16 16-17 17-18 13-14 14-15 15-16 16-17 17-18 as at 31 Mar 17* activities activities activities as at 31 Mar 18*
Cash from operating activities Free cash flow * Includes the effects of exchange rate changes

Overview Geographical work force in % Revenue per employee in AED ‘000

Emirates 17-18 319

dnata 16-17 297

57% Overseas
Group Employee strength (in numbers)
15-16 333
43% UAE 2017-18 2016-17 % change
Financial
Information International airport operations 16,138 16,324 (1.1) 14-15 399

Emirates
UAE airport operations 12,336 12,161 1.4
13-14 356
Financial Catering 4,761 4,645 2.5
Commentary
Travel services 4,257 4,017 6.0
dnata Others 3,515 3,831 (8.2)
Financial
Commentary Average employee strength 41,007 40,978 0.1

Emirates
Consolidated
Financial
Cash position
Statements
Cash from operating activities Employee strength and workforce during the year at some of our The 8.2% employee drop in Others
dnata productivity locations partly offset by the acquisition to 3,515 (2016-17: 3,831) is due to a
Cash generated from operating activities
Consolidated of AirLogistix in the US. recruitment slowdown, natural attrition
Financial increased significantly to AED 1.9bn from
Statements Employee strength arising from retirements and resignations
last year’s figure of AED 1.3bn due to dnata’s UAE airport operations average and new ways of working driven by
record profits and a positive contribution The average workforce remained stable employee count marginally increased
Additional technology, better processes and people
Information from working capital movements. compared to last year and stands at by 1.4% to 12,336 (2016-17: 12,161), management.
Operating cash margin is at 14.2% 41,007 (2016-17: 40,978). broadly in line with the increase in
(2016-17: 10.5%) and is the result of operations. Productivity
With the growth in international
improved cash profit.
operations, the workforce employed Workforce growth in the Catering Revenue per employee increased by
overseas is 57% (2016-17: 56%). business of 2.5% is consistent with the 7.4% to AED 319 thousand (2016-17:
Cash assets
revenue growth. AED 297 thousand) on account of a 7.3%
Cash assets continue to remain strong, International airport operations continue
increase in total revenues and consistent
growing by 45.5% to AED 4.9bn (2016- to be the leading business unit in dnata Average employee count for Travel
employee numbers.
17: AED 3.4b). The increase is due to in terms of workforce strength with services increased by 6.0% to 4,257
healthy cash profits, limited acquisition 16,138 employees, 39% of total group (2016-17: 4,017) primarily due to the
activity during the year and an improved workforce (2016-17: 40%). The 1.1% acquisition of Destination Asia and an
focus on working capital management. reduction compared to the prior year increase in call centre operations at
is due to a shift towards a time based Clark, Philippines.

90
THE EMIRATES GROUP
ANNUAL REPORT

2017-18

Independent Auditor’s Report to the Owner of Emirates

Overview

Emirates

dnata

Group

Financial
Information
Our opinion
Emirates In our opinion, the consolidated financial statements present fairly, in all material Board for Accountants’ Code of Ethics for Professional Accountants (“IESBA Code”)
Financial
Commentary respects, the consolidated financial position of Emirates and its subsidiaries (together and the ethical requirements that are relevant to our audit of the consolidated
referred to as “Emirates”) as at 31 March 2018, and its consolidated financial financial statements in the United Arab Emirates. We have fulfilled our other ethical
dnata
dnata
performance and its consolidated cash flows for the year then ended in accordance responsibilities in accordance with these requirements and the IESBA Code.
Financial
Financial
Commentary
Commentary with International Financial Reporting Standards (“IFRS”).
Our audit approach
Emirates
Emirates What we have audited
Consolidated
Consolidated
Financial
Financial
Overview
Statements
Statements
Emirates’ consolidated financial statements comprise:
As part of designing our audit, we determined materiality and assessed the risks of
● the consolidated income statement for the year ended 31 March 2018;
dnata material misstatement in the consolidated financial statements. In particular, we
Consolidated ● the consolidated statement of comprehensive income for the year ended 31 March 2018; considered where management made subjective judgements; for example, in respect
Financial
Statements ● the consolidated statement of financial position as at 31 March 2018; of significant accounting estimates that involved making assumptions and considering
● the consolidated statement of changes in equity for the year ended 31 March 2018; future events that are inherently uncertain. As in all of our audits, we also addressed
Additional the risk of management override of internal controls, including among other matters
Information ● the consolidated statement of cash flows for the year ended 31 March 2018; and
consideration of whether there was evidence of bias that represented a risk of material
● the notes to the consolidated financial statements, which include a summary of misstatement due to fraud.
significant accounting policies.
The areas, in our professional judgement, that are of most significance to the audit
Basis for opinion (“Key audit matters”) and where we focused most audit effort during the year were:
We conducted our audit in accordance with International Standards on Auditing Key audit matters ● Passenger and cargo revenue recognition
(“ISAs”). Our responsibilities under those standards are further described in the ● Accounting for the “Skywards” frequent flyer programme
Auditor’s responsibilities for the audit of the consolidated financial statements section ● Lease classification and the related lease accounting
of our report. ● Provision for aircraft return conditions
We believe that the audit evidence we have obtained is sufficient and appropriate to
We tailored the scope of our audit in order to perform sufficient work to enable us to
provide a basis for our opinion.
provide an opinion on the consolidated financial statements as a whole, taking into
account the structure of Emirates, the accounting processes and controls, and the
Independence
industry in which Emirates operates.
We are independent of Emirates in accordance with the International Ethics Standards

PricewaterhouseCoopers (Dubai Branch), License no. 102451, Emaar Square, Building 4, Level 8, P O Box 11987, Dubai - United Arab Emirates T: +971 4 304 3100, F: +971 4 346 9150, www.pwc.com/middle-east
Douglas O’Mahony, Paul Suddaby, Jacques Fakhoury and Mohamed ElBorno are registered as practising auditors with the UAE Ministry of Economy 91
THE EMIRATES GROUP
ANNUAL REPORT Independent Auditor’s Report to the Owner of Emirates (continued)
2017-18

Key audit matters

Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the consolidated financial statements for the current year. These
matters were addressed in the context of our audit of the consolidated financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate
opinion on these matters.

Key audit matter How our audit addressed the Key audit matter
Overview

Emirates Passenger and cargo revenue recognition We performed detailed end-to-end walkthroughs of the finance
and operational processes surrounding the revenue system,
dnata When a flight booking is made, passenger and cargo revenue is initially deferred on the utilising our understanding of the industry and Emirates, to
statement of financial position and is measured based on the sales price to the customer. Revenue reassess the design effectiveness of the related key internal
Group is recognised in the consolidated income statement when a passenger or the cargo has flown controls and identify changes, if any.
(refer to notes 2, 3 and 5 to the consolidated financial statements).
Financial
We then conducted testing of the operating effectiveness of
Information The determination of the amount of revenue to be recognised for each flight requires complex IT these controls to obtain sufficient, appropriate evidence that they
systems and involves the exchange of information with industry systems and other airlines for a operated throughout the year as intended.
Emirates
Financial high volume of transactions.
Commentary We tested the key IT systems, including interfaces, that impact
The accounting for passenger and cargo revenue is susceptible to management override of the recognition of revenue from passenger and cargo sales along
dnata
dnata controls through the recording of manual journals in the accounting records, the override of with the change control procedures and related application
Financial
Financial IT systems to accelerate revenue recognition, or the manipulation of inputs used to calculate controls.
Commentary
Commentary
revenue recorded in respect of unused revenue documents.
We performed computer assisted audit techniques over
Emirates
Emirates The timing of revenue recognition for unused tickets requires judgement due to the timeframe
Consolidated
Consolidated passenger and cargo revenue and appropriate substantive tests
Financial
Financial over which tickets can be utilised varying due to the large number of fare types sold by Emirates. of manual journal entries posted into relevant revenue accounts
Statements
Statements Management has determined the value of unused revenue documents that will not be utilised in the sub-ledger and general ledger.
based on ticket terms and conditions and historical expiry trends.
dnata We obtained data supporting Emirates’ historical expiry trend in
Consolidated We focused on this area as a result of the complexity of the related IT systems, the potential respect of unused revenue documents. In addition to performing
Financial
Statements
for management to override controls and the level of judgement required by management in controls based testing as described above, we tested the accuracy
determining the timing of recognition of unused revenue documents. of historical expiry data and compared this data to that used
Additional
Information
by Emirates in their calculation of the amount of revenue to
recognise from unused revenue documents.

92
THE EMIRATES GROUP
ANNUAL REPORT Independent Auditor’s Report to the Owner of Emirates (continued)
2017-18

Key audit matter How our audit addressed the Key audit matter

Accounting for the “Skywards” frequent flyer programme We tested management’s model supporting the calculation of
Skywards deferred revenue as follows:
Emirates operates a frequent flyer programme (“Skywards”) in order to encourage and incentivise
loyalty from its customers. Skywards members either earn Skywards miles after a flight has been ● we understood the process and related controls by which
paid for and flown, or from Skywards partners that purchase miles from Emirates to issue to their deferred revenue is calculated;
Overview customers. Skywards miles can be redeemed for reductions in airfares as well as being used towards ● we tested automated controls and key interfaces around the
free flights, cabin class upgrades and other non-airline rewards. systems used to initially record the Skywards miles for each
Emirates member and ensured that data from the systems is accurately
The fair value of unused miles issued to Skywards members when flights are flown, and recorded in the model;
dnata consideration received for miles issued to Skywards members from sales to partners with a total ● we re-performed calculations within the model;
value of AED 2,243 million (2017: AED 2,465 million), is recognised in the consolidated statement ● we tested the key assumptions within the model, including
Group
of financial position as deferred revenue (refer notes 2, 3 and 27 to the consolidated financial agreeing historical expiry trends supporting the expiry
Financial statements). percentage to underlying reports, discussing known future
Information
The fair value per mile is calculated using a model incorporating a number of factors including changes to the Skywards programme that may impact expiry
Emirates historical sector average fares, fares for upgrades, ticket and upgrade availability and redemption trends with appropriate senior management and testing ticket
Financial patterns. An estimate is also made of the number of miles that will expire based on historical expiry and upgrade availability to internal supporting evidence; and
Commentary
patterns and known future changes to the Skywards programme. ● we performed sensitivity analysis on the key assumptions and
variables used in the model.
dnata
dnata This was a Key audit matter because of the significant level of judgement exercised by management
Financial
Financial
Commentary
Commentary in determining the underlying assumptions within the model.

Emirates
Emirates
Consolidated
Consolidated
Financial
Financial Lease classification and the related lease accounting We evaluated management’s assessment of lease classification
Statements
Statements under IFRS to determine whether a lease is considered to be
Emirates operates aircraft under both finance and operating lease arrangements and during the finance or operating in nature.
dnata year has entered into sale and leaseback transactions on new aircraft deliveries (refer to notes 2,
Consolidated
3, 20 and 23 to the consolidated financial statements). We examined the lease agreements for aircraft deliveries during
Financial
Statements the year to identify:
In determining the appropriate lease classification, IAS 17 – “Leases” is applied by Emirates and
the substance of the transaction rather than just the legal form is considered. Factors considered ● whether the lease transfers ownership of the aircraft to
Additional
Information include but are not limited to the following: Emirates by the end of the lease term;
● whether Emirates has the option to purchase the aircraft at a
● whether the lease transfers ownership of the aircraft to Emirates by the end of the lease term; price that is significantly lower than the fair value on exercise
● whether Emirates has the option to purchase the aircraft at a price that is significantly lower date; and
than the fair value on exercise date; ● whether the lease term is for the major part of the economic
● whether the lease term is for the major part of the economic life of the aircraft; and life of the aircraft.
● whether the present value of the minimum lease payments amounts to substantially all of the
fair value of the leased aircraft. We undertook independent calculations to assess whether
the present value of the minimum lease payments amounts to
Profits or losses on sale and leaseback transactions are either recognised immediately or deferred substantially all of the fair value of the leased aircraft and whether
in accordance with the finance and operating leases accounting policy set out in note 2 to the the rate of return implicit in the lease is calculated reasonably.
consolidated financial statements.
In the case of sale and leaseback transactions on new aircraft
We focused on this area because the accounting implications for leases including the resulting in an operating lease, we compared the fair values
presentation within the consolidated financial statements are substantially different depending of aircraft to the purchase price and recalculated the profit or
on the classification determined, and because of the inherent level of management judgement loss on these transactions. We tested whether management
within the assessment of lease classification and accounting for sale and leaseback transactions, appropriately accounted for the profit or loss arising from these
together with the materiality of the related balances. transactions.
We tested that the related disclosures in the consolidated
financial statements are consistent with the requirements of IFRS.
93
THE EMIRATES GROUP
ANNUAL REPORT Independent Auditor’s Report to the Owner of Emirates (continued)
2017-18

Key audit matter How our audit addressed the Key audit matter

Provision for aircraft return conditions We obtained the aircraft return provision model prepared by
management, together with a summary of the underlying
Emirates operated 158 aircraft under operating lease arrangements at 31 March 2018 (2017: 154). assumptions.
Under the terms of the operating lease arrangements with the lessors, Emirates is contractually We tested the completeness of the provision by ensuring that
Overview committed to either return aircraft and/or engines in a certain condition or to compensate the all significant return condition obligations included in aircraft
lessor based on the actual condition of the aircraft and engines at the date of return. Accordingly, operating lease contracts were included in the model.
Emirates a provision of AED 3,336 million (2017: AED 3,125 million) for the cost associated with these We tested the mathematical accuracy of the calculation.
aircraft return conditions is recorded during the lease term and is included within Provisions (refer
dnata
to notes 2, 3, 24 and 26 of the consolidated financial statements). The following key assumptions were discussed with senior
engineering personnel:
Group The provision is calculated using a model which incorporates a number of assumptions, requiring
significant judgement, including the: ● the past and expected future utilisation and maintenance
Financial patterns of the aircraft;
Information
● past and expected future utilisation and maintenance patterns of the aircraft and engines; ● the expected cost of each maintenance event at the time it is
Emirates ● expected cost of the maintenance at the time it is estimated to occur; and expected to occur; and
Financial
● discount rate applied to the future liability. ● the discount rate applied to the future liability.
Commentary
We focused on this area because of the significant level of judgement exercised by management We compared historical utilisation to flying records and assessed
dnata
dnata
in determining the underlying assumptions within the model. if the future utilisation assumptions were considered in light
Financial
Financial
Commentary
Commentary
of past experience. Assumed maintenance costs were assessed
against historical actual costs incurred and existing long term
Emirates
Emirates maintenance agreements. Future maintenance patterns were
Consolidated
Consolidated assessed against internal maintenance plans. We ensured the
Financial
Financial
Statements
Statements discount rate applied by management to the future liability was
within an acceptable range with reference to the time value of
dnata money applicable to Emirates and the risks specific to the liability.
Consolidated
Financial Along with performing sensitivity on reasonably possible changes
Statements
in assumptions, we also compared provisions held for aircraft and
Additional engines returned during the year to the compensation paid out to
Information the lessors or actual costs incurred to establish if past provisions
were reasonable.

Other information
Management is responsible for the other information.
The other information comprises the information
included in the Annual Report (but does not include
the consolidated financial statements and our auditor’s
report thereon).
Our opinion on the consolidated financial statements
does not cover the other information and we do not
express any form of assurance conclusion thereon.
In connection with our audit of the consolidated financial
statements, our responsibility is to read the other
information identified above and, in doing so, consider
whether the other information is materially inconsistent
94 with the consolidated financial statements or our
knowledge obtained in the audit, or otherwise appears
to be materially misstated.
If, based on the work we have performed, we conclude
that there is a material misstatement of this other
information, we are required to report that fact. We have
nothing to report in this regard.
Responsibilities of management and
those charged with governance for the
consolidated financial statements
Management is responsible for the preparation and fair
presentation of the consolidated financial statements
in accordance with IFRS, and for such internal control
as management determines is necessary to enable the
preparation of consolidated financial statements that are
free from material misstatement, whether due to fraud
or error.
In preparing the consolidated financial statements,
management is responsible for assessing Emirates’ ability
to continue as a going concern, disclosing, as applicable,
matters related to going concern and using the going
concern basis of accounting unless management either
intends to liquidate Emirates or to cease operations, or
has no realistic alternative but to do so.
Those charged with governance are responsible for
overseeing Emirates’ financial reporting process.
THE EMIRATES GROUP
ANNUAL REPORT Independent Auditor’s Report to the Owner of Emirates (continued)
2017-18

Auditor’s responsibilities for the audit of the consolidated

financial statements
Our objectives are to obtain reasonable assurance about whether the consolidated We communicate with those charged with governance regarding, among other matters,
financial statements as a whole are free from material misstatement, whether due to the planned scope and timing of the audit and significant audit findings, including any
fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable significant deficiencies in internal control that we identify during our audit.
assurance is a high level of assurance, but is not a guarantee that an audit conducted
We also provide those charged with governance with a statement that we have complied
Overview in accordance with ISAs will always detect a material misstatement when it exists.
with relevant ethical requirements regarding independence, and to communicate with
Misstatements can arise from fraud or error and are considered material if, individually
Emirates them all relationships and other matters that may reasonably be thought to bear on our
or in the aggregate, they could reasonably be expected to influence the economic
independence, and where applicable, related safeguards.
dnata
decisions of users taken on the basis of these consolidated financial statements.
From the matters communicated with those charged with governance, we determine
As part of an audit in accordance with ISAs, we exercise professional judgement and
Group those matters that were of most significance in the audit of the consolidated financial
maintain professional scepticism throughout the audit. We also:
statements of the current year and are therefore the Key audit matters. We describe
Financial
Information ● Identify and assess the risks of material misstatement of the consolidated financial these matters in our auditor’s report unless law or regulation precludes public disclosure
statements, whether due to fraud or error, design and perform audit procedures about the matter or when, in extremely rare circumstances, we determine that a matter
Emirates
Financial
responsive to those risks, and obtain audit evidence that is sufficient and appropriate should not be communicated in our report because the adverse consequences of
Commentary to provide a basis for our opinion. The risk of not detecting a material misstatement doing so would reasonably be expected to outweigh the public interest benefits of
resulting from fraud is higher than for one resulting from error, as fraud may involve such communication.
dnata
dnata
Financial
Financial
collusion, forgery, intentional omissions, misrepresentations, or the override of
PricewaterhouseCoopers
Commentary
Commentary internal control.
3 May 2018
Emirates
Emirates ● Obtain an understanding of internal control relevant to the audit in order to design
Consolidated
Consolidated audit procedures that are appropriate in the circumstances, but not for the purpose
Financial
Financial
Statements
Statements of expressing an opinion on the effectiveness of Emirates’ internal control.

dnata ● Evaluate the appropriateness of accounting policies used and the reasonableness of
Consolidated accounting estimates and related disclosures made by management. Douglas O’Mahony
Financial
Statements Registered Auditor Number 834
● Conclude on the appropriateness of management’s use of the going concern basis Dubai, United Arab Emirates
Additional of accounting and, based on the audit evidence obtained, whether a material
Information uncertainty exists related to events or conditions that may cast significant doubt
on Emirates’ ability to continue as a going concern. If we conclude that a material
uncertainty exists, we are required to draw attention in our auditor’s report to the
related disclosures in the consolidated financial statements or, if such disclosures are
inadequate, to modify our opinion. Our conclusions are based on the audit evidence
obtained up to the date of our auditor’s report. However, future events or conditions
may cause Emirates to cease to continue as a going concern.

● Evaluate the overall presentation, structure and content of the consolidated financial
statements, including the disclosures, and whether the consolidated financial
statements represent the underlying transactions and events in a manner that
achieves fair presentation.

● Obtain sufficient appropriate audit evidence regarding the financial information

of the entities or business activities within Emirates to express an opinion on the
consolidated financial statements. We are responsible for the direction, supervision
and performance of the Emirates audit. We remain solely responsible for our audit
opinion.

95
 Consolidated Income Statement
THE EMIRATES GROUP
ANNUAL REPORT

2017-18
for the year ended 31 March 2018
Emirates
CONSOLIDATED INCOME STATEMENT
FOR THE YEAR ENDED 31 MARCH 2018
Emirates Note 2018 2017
CONSOLIDATED INCOME STATEMENT AED m AED m
FOR THE YEAR ENDED 31 MARCH 2018
Revenue 5 91,225 83,832
Other operating income Note
6 2018
1,097 2017
1,251
Operating costs 7 AED m
(88,236) AED m
(82,648)
Overview Revenue profit 5 91,225 83,832
Operating 4,086 2,435
Emirates Other operating
Finance income income 86 1,097
375 1,251
281
Operating
Finance costs
costs 87 (88,236)
(1,593) (82,648)
(1,383)
dnata
Operating
Share profit
of results of investments accounted for using the equity method 13 4,086
155 2,435
157
Group
Financebefore
Profit incomeincome tax 8 375
3,023 281
1,490
Financial Finance tax
costs
Information
Income expense 98 (1,593)
(44) (1,383)
(40)
Share of
Profit forresults of investments accounted for using the equity method
the year 13 155
2,979 157
1,450
Emirates
Financial Profitattributable
Profit before income tax
to non-controlling interests 3,023
183 1,490
200
Commentary
Incomeattributable
Profit tax expenseto Emirates' Owner 9 (44)
2,796 (40)
1,250
dnata
dnata Profit for the year 2,979 1,450
Financial
Financial
Commentary
Commentary Profit attributableSTATEMENT
CONSOLIDATED to non-controlling interests
OF COMPREHENSIVE INCOME 183 200

Emirates
Emirates
Consolidated
Consolidated
Consolidated Statement of Comprehensive Income
Profit
FOR THEattributable
YEAR ENDEDto Emirates'
31 MARCH Owner
2018 2,796 1,250

for the year ended 31 March INCOME 2018

Financial
Financial Profit for the year 2,979 1,450
Statements
Statements CONSOLIDATED STATEMENT OF COMPREHENSIVE
Items that will not be reclassified to the consolidated income statement
dnata FOR THE YEAR ENDED 31 MARCH 2018
Consolidated Remeasurement of retirement benefit obligations 25 (6) 311
Financial Profit that
for the
Statements Items areyear
or may be reclassified subsequently to the consolidated income statement 2,979 1,450
Items that will
Currency not be reclassified
translation differences to the consolidated income statement 19 1 -
Additional
Information Remeasurement
Cash flow hedgesof retirement benefit obligations 25
19 (6)
155 311
1,038
Items that
Other are or may income
comprehensive be reclassified
for the subsequently
year to the consolidated income statement 150 1,349
TotalCurrency translation
comprehensive differences
income for the year 19 3,1291 -
2,799
TotalCash flow hedgesincome attributable to non-controlling interests
comprehensive 19 155
183 1,038
200
Othercomprehensive
Total comprehensiveincome
incomeattributable
for the yearto Emirates' Owner 150
2,946 1,349
2,599
Total comprehensive income for the year 3,129 2,799
Totalaccompanying
The comprehensive income
notes attributable
are an to non-controlling
integral part interests
of these consolidated financial statements. 183 200
Total comprehensive income attributable to Emirates' Owner 2,946 2,599

The accompanying notes are an integral part of these consolidated financial statements.

1
The accompanying notes are an integral part of these consolidated financial statements.
96
 Consolidated Statement of Financial Position
THE EMIRATES GROUP
ANNUAL REPORT

2017-18
irates
as at 31 March 2018
Emirates
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
NSOLIDATED STATEMENT
AS OF
AT FINANCIAL POSITION
31 March 2018 Note 2018 20
AT 31 March 2018 Note 2018 2017 Note 2018 2017 AED m AED
Note 2018 2017 AED m AED m AED m AED m
EQUITY AND LIABILITIES
AED m AED m
ASSETS EQUITY AND LIABILITIES Capital and reserves
SETS Non-current assets Capital and reserves Capital 18 801 8
n-current assets Property, plant and equipment 11 85,951 86,898 Capital 18 801 801
Other reserves 19 15 (1
perty, plant and equipment
Overview
Intangible assets 11 85,951 86,898
12 1,496 1,441 Other reserves Retained earnings 19 15 (141) 35,638 33,8
ngible assets 12 using the equity
1,496 1,441 Retained earnings Attributable to Emirates' Owner 35,638 33,848 36,454 34,50
Emirates Investments accounted for
estments accounted for using the equity Attributable to Emirates' Owner
Non-controlling interests 36,454 34,508 592 5
dnata method 13 662 676
Non-controlling interests Total equity 592 586 37,046 35,09
thod Advance lease rentals 13 662 676
14 5,065 4,421
Group Total equity 37,046 35,094
ance lease rentals Loans and other receivables14 5,065 4,421
15 172 238
ns and other receivables Derivative financial instruments
Financial 15 172 238 Non-current liabilities
Information 35 60 38 Non-current liabilities Trade and other payables 30 123 6
ivative financial instruments 35
Deferred income tax asset 60 2938 11 10
Emirates
Trade and other payables 30
Borrowings and lease liabilities 123 683
20 42,071 40,1
erred income tax asset 29 11 10 93,417 93,722
Financial Borrowings and lease liabilities
Deferred revenue 20 42,071 40,171
27 1,063 9
Commentary
Current assets 93,417 93,722 Deferred revenue 27 1,063 979
Deferred credits 28 2,621 2,2
rent assets
dnata
dnata
Inventories 16 2,387 2,238 Deferred credits 28
Derivative financial instruments 2,621 2,227
35 26 1
Financial
Financial
entories
Commentary
Commentary
Trade and other receivables16 2,387 2,238
17 11,354 9,922 Derivative financial instruments
Provisions 35 26 192
24 4,067 3,8
de and other
Emirates receivables 17 11,354 9,922 Provisions 24
Deferred income tax liability 4,067 3,825
29 4
Emirates Derivative financial instruments 35 9 8
Consolidated
Consolidated Deferred income tax liability 29 4 5
ivative financial instruments 49,975 48,08
Financial
Financial Short term bank deposits35 9 33 8 14,745 6,706
Statements
Statements Current liabilities 49,975 48,082
rt term bank deposits 33
Cash and cash equivalents 14,745 6,706
33 5,675 8,962
Current liabilities Trade and other payables 30 29,303 25,1
h and cash equivalents
dnata 33 5,675 8,962 34,170 27,836
Consolidated Trade and other payables Income tax liabilities 30 29,303 25,193 18
Financial
Total assets 34,170 27,836 127,587 121,558
Statements Income tax liabilities Borrowings and lease liabilities 18 2019 9,030 10,8
al assets 127,587 121,558
Borrowings and lease liabilities
Deferred revenue 20 9,030 10,831
27 1,180 1,4
Additional
Information Deferred revenue Deferred credits 27 1,180 1,486
28 313 2
Deferred credits 28
Derivative financial instruments 313 253
35 35
Derivative financial instruments
Provisions 35 35 24 3 687 5
Provisions 24 687 597 40,566 38,38
Total liabilities 40,566 38,382 90,541 86,46
The accompanying notes are an integral part of these consolidated financial statements
accompanying notes are an integral part of these consolidated financial statements Total liabilities Total equity and liabilities 90,541 86,464 127,587 121,55
Total equity and liabilities 127,587 121,558

The consolidated financial statements were approved on 3 May 2018 and signed by
The consolidated financial statements were approved on 3 May 2018 and signed by:
The consolidated financial statements were approved on 3 May 2018 and signed by:

Sheikh Ahmed bin Saeed Al-Maktoum Timothy Clark

Sheikh Ahmed bin Saeed Al-Maktoum
Chairman and Chief Executive Timothy Clark President
Chairman and Chief Executive President
Sheikh Ahmed bin Saeed Al-Maktoum Timothy Clark
Chairman and 2
Chief Executive President
2
The accompanying notes are an integral part of these consolidated financial statements.
97
 Consolidated Statement of Changes in Equity
THE EMIRATES GROUP
ANNUAL REPORT

2017-18
for the year ended 31 March 2018
Emirates
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MARCH 2018
Attributable to Emirates' Owner
Non-
Other Retained controlling Total
Capital reserves earnings Total interests equity
AED m AED m AED m AED m AED m AED m

Overview
1 April 2016 801 (1,179) 32,287 31,909 496 32,405
Profit for the year - - 1,250 1,250 200 1,450
Emirates
Other comprehensive income - 1,038 311 1,349 - 1,349
dnata Total comprehensive income - 1,038 1,561 2,599 200 2,799
Group Dividends - - - - (110) (110)
Transactions with Owners - - - - (110) (110)
Financial
Information 31 March 2017 801 (141) 33,848 34,508 586 35,094
Emirates Profit for the year - - 2,796 2,796 183 2,979
Financial
Commentary Other comprehensive income - 156 (6) 150 - 150
Total comprehensive income - 156 2,790 2,946 183 3,129
dnata
dnata
Financial
Financial Non-controlling interest on acquisition of a subsidiary - - - - (4) (4)
Commentary
Commentary
Dividends - - (1,000) (1,000) (173) (1,173)
Emirates
Emirates Transactions with Owners - - (1,000) (1,000) (177) (1,177)
Consolidated
Consolidated
Financial
Financial 31 March 2018 801 15 35,638 36,454 592 37,046
Statements
Statements

dnata
Consolidated
Financial
Statements The accompanying notes are an integral part of these consolidated financial statements.

Additional
Information

The accompanying notes are an integral part of these consolidated financial statements.
98
 Consolidated Statement of Cash Flows
THE EMIRATES GROUP
ANNUAL REPORT

2017-18
for the year ended 31 March 2018
Emirates Note 2018 2

CONSOLIDATED STATEMENT OF CASH FLOWS AED m AE

FOR THE YEAR ENDED 31 MARCH 2018 Investing activities

ates Note 2018 2017 Additions to property, plant 2018
Note and equipment 2017
34 (3,279) (4
NSOLIDATED STATEMENT OF CASH FLOWS AED m AED m Additions to intangible assets AED m AED m
12 (209) (
Operating
THE YEAR ENDED 31 MARCH 2018activities Investing activities Proceeds from sale of property, plant and
Profit before income tax
Note 2018 2017 3,023 1,490 equipment
Additions to property, plant and equipment 34 (3,279) (4,382) 98

Adjustments for: AED m AED m Additions to intangible assets Acquisition of subsidiaries, net
12 of cash acquired
(209) (269) (6)
Overview
rating activities Depreciation and amortisation 7 9,193 8,304 Investments
Proceeds from sale of property, plant and in associates and joint ventures 13 (5) (
Emirates
t before income tax Finance costs - net 3,023 1,490 1,218 1,102 equipment Movement in short term bank deposits 98 117 (8,039) 1
stments
dnata for: Net loss / (gain) on sale of property, plant and Acquisition of subsidiaries, netFinance
of cashincome
acquired (6) - 288

epreciation and amortisationequipment 7 9,193 8,304 82 (23) Investments in associates and Dividends from investments
joint ventures 13accounted for
(5)using (137)
Group
the equity method 13 175
nance costs - net Share of results of investments accounted
1,218 for 1,102 Movement in short term bank deposits (8,039) 1,117
Financial Net cash used in investing activities (10,977) (3,
Information using the equity method 13 (155) (157) Finance income 288 285
et loss / (gain)
on sale of property, plant and
uipment Net provision for impairment of trade 82 (23) Dividends from investments accounted for using
Emirates
Financial receivables 17 20 23 the equity method Financing activities 13 175 140
are of results of investments accounted for
Commentary
ing the equity method Provision for retirement benefit
13 obligations
(155) (157)7 732 741 Net cash used in investing activities (10,977)
Proceeds from bonds and term loans (3,129)
21,22 5,584 3
dnata
et provision for impairment Net movement on derivative financial instruments
dnata (3) 22 Repayment of bonds and term loans 21,22 (3,981)
Financial
Financial of trade (5
Commentary
Commentary
ceivables 17
Payments for retirement benefit 20
obligations 23 (617) (597) Financing activities Aircraft finance lease costs (1,157) (
ovision for retirement benefit
Emirates
Emirates obligations
Income tax paid 7 732 741 (66) (70) Proceeds from bonds and term loansfinance costs
Other 21,22 5,584 3,010 (207) (
Consolidated
Consolidated
et movement
Financial
Financial on derivativeChange
financial
in instruments
inventories (3) 22 (145) (132) Repayment of bonds and termRepayment
loans 21,22
of lease liabilities (3,981) 23
(5,626) (6,508) (4
Statements
Statements
ments for retirement benefit obligations
Change in receivables and advance lease rentals
(617) (597) (1,892) (2,146) Aircraft finance lease costs Dividend paid to Emirates' Owner (1,157) (995) - (2
me dnata
tax paid Change in provisions, payables, deferred(66)
credits (70) Other finance costs (207)
Dividend paid to non-controlling interests (257) (173) (
Consolidated
nge Financial
in inventories and deferred revenue (145) (132) 2,744 1,868 Repayment of lease liabilities Net cash used in financing
23activities
(6,508) (4,424) (6,442) (10,
Statements
Net cash generated
nge in receivables and advance lease rentals from operating activities
(1,892) (2,146) 14,134 10,425 Dividend paid to Emirates' Owner - (2,100)
Additional
nge Information
in provisions, payables, deferred credits Dividend paid to non-controlling
Netinterests (173)
change in cash and cash equivalents (110) (3,285) (3,
deferred revenue 2,744 1,868 Net cash used in financing activities (6,442)
Cash and cash equivalents at beginning of year (10,502) 8,958 12
cash generated from operating activities 14,134 10,425 Effect of exchange rate changes 2

The accompanying notes are an integral part of these consolidated financial statements. Net change in cash and cashCash
equivalents (3,285)
and cash equivalents at end of year (3,206)
33 5,675 8,
Cash and cash equivalents at beginning of year 8,958 12,165
Effect of exchange rate changes 2 (1)
accompanying notes are an integral part of these consolidated financial statements. Cash and cash equivalents at end of year 33 5,675 8,958

The accompanying notes are an integral part of these consolidated financial statements.
4 99
 Notes to the Consolidated Financial Statements
THE EMIRATES GROUP
ANNUAL REPORT

2017-18
for the year ended 31 March 2018
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2018
New standards, amendments to published standards and interpretations that are
relevant to Emirates

Effective
New and adopted
standards, in the current
amendments year standards and interpretations that are
to published
NOTES
1. TOinformation
General THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2018 relevant to Emirates
Emirates comprises Emirates and its subsidiaries. Emirates was incorporated, with limited At the date of authorisation of these consolidated financial statements, certain
amendments
Effective and to the existing
adopted in thestandards were effective for the current financial year and
current year
liability,
1. General by information
an Emiri Decree issued by H. H. Sheikh Maktoum bin Rashid Al-Maktoum on
have been adopted by Emirates. These are as follows:
26 June 1985 and is wholly owned by the Investment Corporation of Dubai (“the parent
company”), a Government
Emirates comprises Emiratesofand
Dubai
its entity. Emirates
subsidiaries. commenced
Emirates commercialwith
was incorporated, operations
limited At the date of authorisation of these consolidated financial statements, certain
Amendments
amendments to IAS
to the 7, Statement
existing of were
standards Cash effective
Flows (effective
for thefrom 1 January
current 2017)
financial year and
Overview
on 25 October 1985 and is designated as the International Airline of the UAE.
liability, by an Emiri Decree issued by H. H. Sheikh Maktoum bin Rashid Al-Maktoum on haveAmendments
been adoptedtobyIFRS 12, Disclosure
Emirates. These areofasInterests
follows: in Other Entities (effective from 1
26 June 1985 and is wholly owned by the Investment Corporation of Dubai (“the parent January 2017)
Emirates Emirates
company”),is incorporated
a Governmentandofdomiciled in Dubai,
Dubai entity. UAE.commenced
Emirates The addresscommercial
of its registered office
operations Amendments to
 Amendments to IAS
IAS 12, Income taxes
7, Statement (effective
of Cash Flows from 1 January
(effective from 2017)
1 January 2017)
is Emirates
on Group
25 October Headquarters,
1985 PO Box
and is designated as686, Dubai, UAE. Airline of the UAE.
the International
dnata
 Amendments to IFRS 12, Disclosure of Interests in Other Entities (effective from 1
The mainisactivities of Emirates comprise:in Dubai, UAE. The address of its registered office These amendments
January 2017) did not have a material impact on the consolidated financial
Group Emirates incorporated and domiciled statements. However, disclosure changes arising from
 Amendments to IAS 12, Income taxes (effective fromamendments to IAS 7 have been
1 January 2017)
is Emirates Group Headquarters, PO Box 686, Dubai, UAE. addressed in Note 23 through presentation of changes in opening and closing balances
Financial  commercial air transportation which includes passenger and cargo services
Information
 wholesale and retail of consumer goods of finance
These lease liabilities.
amendments did not have a material impact on the consolidated financial
The main activities of Emirates comprise:
Emirates  catering operations statements. However, disclosure changes arising from amendments to IAS 7 have been
Financial  hotel operations Not yet effective
addressed in Noteand have not
23 through been early of
presentation adopted
changes in opening and closing balances
Commentary commercial air transportation which includes passenger and cargo services
 food and beverage
wholesale and retailsales
of consumer goods of finance lease liabilities.
dnata
dnata
At the date of authorisation of these consolidated financial statements, certain new
 catering operations
Financial
Financial accounting standards
andhave
havebeen published
earlythat are not mandatory for the financial year
Commentary
Commentary 2. Summary of significant accounting policies
hotel operations Not yet effective not been adopted
ended 31 March 2018, and have not been early adopted.
 food and beverage sales
Emirates
Emirates A summary of the significant accounting policies, which have been applied consistently At the date of authorisation of these consolidated financial statements, certain new
Consolidated
Consolidated in Management has assessed
have the impact of these
thataccounting standards:for the financial year
Financial
Financial 2. the preparation
Summary of these consolidated
of significant financial statements are set out below.
accounting policies accounting standards been published are not mandatory
Statements
Statements ended 31 March 2018, and have not been early adopted.
Basis of preparation IFRS 9, Financial Instruments (effective from 1 January 2018)
A summary of the significant accounting policies, which have been applied consistently
dnata
in the preparation of these consolidated financial statements are set out below. Management has assessed the impact of these accounting standards:
Consolidated
Financial The consolidated financial statements have been prepared in accordance with Emirates will adopt IFRS 9 which addresses the classification, measurement and
Statements International Financial Reporting Standards (IFRS) and IFRS Interpretations Committee derecognition of financial
IFRS 9, Financial assets
Instruments and financial
(effective fromliabilities,
1 Januaryintroduces
2018) new rules for hedge
Basis of preparation
(IFRS IC) pronouncements. The consolidated financial statements are prepared under the accounting and a new impairment model for financial assets from 1 April 2018.
Additional
Information historical cost convention,
The consolidated financialexcept
statements financial
for thosehave beenassets and financial
prepared liabilities with
in accordance that Emirates will adopt IFRS 9 which addresses the classification, measurement and
are measured at fair value as stated in the accounting policies. Emirates has reviewed
derecognition the new
of financial assetsrequirements
and financialapplicable
liabilities,tointroduces
its financial
newassets
rulesand
for ithedge
does
International Financial Reporting Standards (IFRS) and IFRS Interpretations Committee
not expect the
accounting andnew
a newguidance to affect
impairment modelthefor
classification and measurement
financial assets of its financial
from 1 April 2018.
(IFRS IC) pronouncements. The consolidated financial statements are prepared under the
All amounts areconvention,
presented in millions assets. There will be no impact on Emirates’ financial liabilities as the new requirements
historical cost except forofthose
UAE Dirham
financial(“AED”).
assets and financial liabilities that
only affect
Emirates the
has accounting
reviewed for financial
the new liabilities
requirements that areto
applicable designated at assets
its financial fair value
andthrough
it does
are measured at fair value as stated in the accounting policies.
profit or loss and Emirates does not have any such liabilities.
not expect the new guidance to affect the classification and measurement of its financial
All amounts are presented in millions of UAE Dirham (“AED”). assets. There will be no impact on Emirates’ financial liabilities as the new requirements
The new impairment
only affect model
the accounting under IFRS
for financial 9 requires
liabilities that are the recognition
designated at fairofvalue
impairment
through
provisions
profit based
or loss on expected
and Emirates doescredit losses
not have any(ECL)
suchrather than only incurred credit losses
liabilities.
as is the case under IAS 39. It applies to trade receivables and other financial assets.
Based
The new on the assessments
impairment modelundertaken,
under IFRSEmirates does not
9 requires theexpect any significant
recognition change
of impairment
in the loss allowance
provisions for these financial
based on expected assets.
credit losses (ECL) rather than only incurred credit losses
as is the case under IAS 39. It applies to trade receivables and other financial assets.
Based on the assessments undertaken, Emirates does not expect any significant change
5 loss allowance for these financial assets.
in the

5
100
THE EMIRATES GROUP
ANNUAL REPORT

2017-18

2. Summary of significant accounting policies (continued) Emirates is currently assessing the detailed financial impact of this standard on its
consolidated financial statements.
IFRS 9, Financial Instruments (effective from 1 January 2018) (continued)
There are no other standards, amendments or interpretations, that are either effective or
The new guidance has substantially reformed the existing hedge accounting rules. It not yet effective, and would be expected to have a material impact on Emirates.
provides a more principles-based approach that aligns hedge accounting closely with
risk management policies. Emirates does not expect any significant impact on its hedge Basis of consolidation
Overview
accounting under IFRS 9.
Emirates Subsidiaries are those entities (including structured entities) over which Emirates has
The new standard also introduces expanded disclosure requirements and changes in control. Control is exercised when Emirates is exposed to, or has rights to, variable
dnata
presentation, however, these are not expected to materially change the nature and returns from its involvement with the entity and has the ability to affect those returns
Group extent of Emirates disclosures about its financial instruments. through its power over that entity. Subsidiaries are fully consolidated from the date on
which control is transferred to Emirates and are de-consolidated from the date that
Financial IFRS 15, Revenue from Contracts with Customers (effective from 1 January 2018) control ceases. Inter-company transactions, balances and unrealised gains and losses
Information
arising on transactions between Emirates and its subsidiaries are eliminated.
Emirates IFRS 15 replaces IAS 18 which covers contracts for sale of goods and rendering of
Financial services and IAS 11 which covers construction contracts. The acquisition method of accounting is used to account for business combinations by
Commentary
Emirates. The consideration transferred for the acquisition of a subsidiary comprises the
dnata
dnata The new standard is based on the principle that revenue is recognised when control of a fair value of the assets transferred, liabilities pertaining to the former owners of the
Financial
Financial good or service transfers to a customer – so the notion of control replaces the existing subsidiary, fair value of any contingent consideration arrangements and the fair value of
Commentary
Commentary
notion of risks and rewards. The standard provides a new five-step model that must be any pre-existing equity interest in the subsidiary. Acquisition-related costs are expensed
Emirates
Emirates applied to all contracts with customers. as incurred. Identifiable assets, including intangible assets acquired, liabilities and
Consolidated
Consolidated contingent liabilities, if any, incurred or assumed in a business combination, are
Financial
Financial
Statements
Statements Emirates will apply the modified retrospective method on transition to the new standard measured initially at their fair values at the acquisition date. Any non-controlling interest
from 1 April 2018 and the comparatives will not be restated. Emirates currently in the subsidiary is recognised on an acquisition-by-acquisition basis, either at fair value
dnata or at the non-controlling interest’s proportionate share of recognised amounts of
recognises revenue from certain ancillary services such as administration fees at the time
Consolidated
Financial of collection. IFRS 15 requires such income to be recognised when the related subsidiaries’ identifiable net assets.
Statements transportation is provided. Accordingly on 1 April 2018, contract liabilities (currently
disclosed as passenger and cargo sales in advance) will increase by approximately AED Contingent consideration is classified either as equity or a financial liability. Amounts
Additional
Information 40m with a corresponding impact on retained earnings. classified as a financial liability are subsequently remeasured to fair value with changes in
fair value recognised in the consolidated income statement.
IFRS 16, Leases (effective from 1 January 2019)
If the business combination is achieved in stages, the acquisition date carrying value of
IFRS 16 removes the current distinction between operating and finance leases and Emirates’ previously held equity interest in the subsidiary is remeasured to fair value at
requires recognition of an asset (the right to use the leased item) and a financial liability the acquisition date. Any gains or losses arising from such remeasurement are
(the obligation to pay rentals). An optional exemption exists for short-term and low- recognised in the consolidated income statement.
value leases.
Emirates treats transactions with non-controlling interests that do not result in loss of
The standard will have a significant impact on the Emirates consolidated financial control as transactions with the owners. A change in ownership interest results in an
statements considering the number of aircraft and other operating leases in its portfolio. adjustment between the carrying amounts of the controlling and non-controlling
For example, the consolidated income statement will be impacted because the total interests to reflect their relative interests in the subsidiary. Any difference between the
expense is typically higher in the earlier years of a lease and lower in later years. amount of the adjustment to non-controlling interests and any consideration paid is
Additionally, operating lease charges will be replaced with interest and depreciation recorded in equity.
expenses. These changes will affect key ratios like profit margin, operating margin,
EBITDA margin etc. Further, operating cash flows will be higher as cash payments for the
principal portion of the lease liability will be classified within financing activities.
6
101
THE EMIRATES GROUP
ANNUAL REPORT

2017-18

2. Summary of significant accounting policies (continued) Revenue

Basis of consolidation (continued) Passenger (including excess baggage) and cargo sales are recognised as revenue when
the transportation is provided. Revenue documents (e.g. tickets or airway bills) sold but
Associates are those entities in which Emirates has significant influence but not control unused are held in the consolidated statement of financial position under current
or joint control, generally accompanying a shareholding between 20% and 50% of the liabilities as passenger and cargo sales in advance. Unused revenue documents are
voting rights. Significant influence is the power to participate in the financial and recognised as revenue based on their terms and conditions and historical trends.
Overview
operating policy decisions of the investee, but is not control or joint control over those
Emirates policies. Investments in associates are accounted for by applying the equity method and Revenue from the sale of consumer goods, food and beverages and catering operations
include goodwill (net of accumulated impairment loss, if any) identified on acquisition, is recognised when risks and rewards of ownership are transferred to the customer and
dnata
after initially being recorded at cost. is stated net of discounts and returns.
Group
Joint ventures are contractual arrangements which establish joint control and where All other revenues, including revenue from hotel operations are recognised net of
Financial Emirates has rights to the net assets of the arrangement. Joint control is the contractually discounts and taxes when services are provided.
Information
agreed sharing of control of an arrangement, which exists only when decisions about the
Emirates relevant activities require the unanimous consent of the parties sharing control. Frequent flyer programme (‘Skywards’)
Financial Investments in joint ventures are accounted for by applying the equity method and
Commentary
include goodwill (net of accumulated impairment loss, if any) identified on acquisition, Emirates operates a frequent flyer programme that provides a variety of awards to
dnata
dnata after initially being recognised at cost. programme members based on a mileage credit for flights on Emirates and other
Financial
Financial airlines that participate in the programme. Members can also accrue miles by utilising
Commentary
Commentary
When Emirates’ share of losses in an equity-accounted investment equals or exceed its the services of non-airline programme participants.
Emirates
Emirates interest in the entity, including any other unsecured long term receivables, Emirates does
Consolidated
Consolidated not recognise further losses, unless it has incurred obligations or made payments on Emirates accounts for Skywards miles as a separately identifiable component of the sales
Financial
Financial
Statements
Statements behalf of the other entity. transaction in which they are granted. The consideration in respect of the initial sale is
allocated to Skywards miles based on their fair value, adjusted for expected expiry and is
dnata All material unrealised gains and losses arising on transactions between Emirates and its accounted for as a liability (deferred revenue) in the consolidated statement of financial
Consolidated
Financial associates and joint ventures are eliminated to the extent of Emirates’ interest. position. The fair value is determined using estimation techniques that take into account
Statements the fair value of awards for which miles could be redeemed. Miles accrued through
Accounting policies of subsidiaries, associates and joint ventures have been changed utilising the services of programme partners and paid for by the participating partners
Additional
Information where necessary to ensure consistency with Emirates’ accounting policies. are also accounted for as deferred revenue until they are utilised.

When Emirates ceases to have control, any retained interest in the entity or business is Revenue is recognised in the consolidated income statement only when Emirates fulfils
remeasured to its fair value at the date when control is lost, with the change in the its obligations by supplying free or discounted goods or services on redemption of the
carrying amount recognised in the consolidated income statement. The fair value miles accrued.
becomes the initial carrying amount for the purposes of subsequent accounting for the
retained interest as an associate, joint venture or financial asset. In addition, any amounts Finance income and costs
previously recognised in other comprehensive income in respect of that entity or
business are accounted for as if the related assets or liabilities have been directly Interest income and costs are recognised on a time proportion basis using the effective
disposed off. This may mean that amounts previously recognised in other interest method.
comprehensive income are reclassified to the consolidated income statement. If the
ownership in a joint venture or an associate is reduced but joint control or significant
influence is retained, only a proportionate share of the amounts previously recognised in
other comprehensive income are reclassified to the consolidated income statement
where appropriate.

7
102
THE EMIRATES GROUP
ANNUAL REPORT

2017-18

2. Summary of significant accounting policies (continued) Income tax

Liquidated damages The tax expense for the period comprises current and deferred tax.

Income from claims for liquidated damages on aircraft and related assets is recognised The current income tax charge is calculated on the basis of the tax laws enacted or
in the consolidated income statement as other income or a reduction to operating costs substantively enacted at the end of the reporting period in the countries where Emirates
when a contractual entitlement exists, amounts can be reliably measured and receipt is operates and generates taxable income.
Overview
virtually certain. When such claims do not relate to compensations for loss of income or
Emirates are not towards incremental operating costs, the amounts are taken to the consolidated Deferred income tax is provided in full on temporary differences arising between the tax
statement of financial position and recorded as a reduction in the cost of the related bases of assets and liabilities and their carrying amounts in the consolidated financial
dnata
asset. statements. However, deferred income tax is not recognised if it arises from initial
Group recognition of an asset or liability in a transaction other than a business combination
Foreign currency translation that at the time of the transaction affects neither accounting nor taxable profit or loss.
Financial Also, deferred tax liabilities are not recognised if they arise from the initial recognition of
Information
Emirates’ consolidated financial statements are presented in UAE Dirham (“AED”), which goodwill in a business combination. Deferred income tax is determined using tax rates
Emirates is also the company’s functional currency. Subsidiaries, associates and joint ventures (and laws) that have been enacted or substantially enacted at the end of reporting
Financial determine their own functional currency and items included in the financial statements period and are expected to apply when the related deferred income tax asset is realised
Commentary
of these companies are measured using that functional currency. or the deferred income tax liability is settled.
dnata
dnata
Financial
Financial Foreign currency transactions are translated into the functional currency at the exchange Deferred income tax assets are recognised only to the extent that it is probable that
Commentary
Commentary
rates prevailing at the transaction dates. Monetary assets and liabilities denominated in future taxable profit will be available against which the temporary differences can be
Emirates
Emirates foreign currencies are translated into the functional currency at the exchange rates utilised.
Consolidated
Consolidated prevailing at the end of the reporting period. The resultant foreign exchange gains and
Financial
Financial
Statements
Statements losses, other than those on qualifying cash flow hedges deferred in other comprehensive Property, plant and equipment
income, are recognised in the consolidated income statement.
dnata Property, plant and equipment is stated at cost less accumulated depreciation. Cost
Consolidated
Financial Where functional currencies of subsidiaries are different from AED, income and cash flow consists of purchase cost, together with any incidental expenses of acquisition.
Statements statements of subsidiaries are translated into AED at average exchange rates for the year
that approximate the cumulative effect of rates prevailing on the transaction dates and Subsequent costs are included in the asset’s carrying amount or recognised as a
Additional
Information their assets and liabilities are translated at the exchange rates ruling at the end of separate asset, as appropriate, only when it is probable that future economic benefits
reporting period. The resulting exchange differences are recognised in other associated with the item will flow to Emirates and the cost can be measured reliably.
comprehensive income. Repairs and maintenance are charged to the consolidated income statement during the
period in which they are incurred.
Share of results of investments accounted for using the equity method are translated
into AED at average exchange rates for the year whereas Emirates’ share of net Land is not depreciated. Depreciation on other items of property, plant and equipment is
investments is translated at the exchange rate prevailing at the end of the reporting calculated using the straight-line method to allocate their cost, less estimated residual
period. Translation differences relating to investments in associates, joint ventures and values, over the estimated useful lives of the assets or the lease term, if shorter.
monetary assets and liabilities that form part of a net investment in a foreign operation
are recognised in other comprehensive income. When investments in associates, joint The estimated useful lives and residual values are:
ventures or net investment in a foreign operation are disposed of, the related
translation differences previously recorded in equity are recognised in the consolidated Aircraft – new 15 - 18 years (residual value nil - 10%)
income statement as part of the gain or loss on disposal. Aircraft – used 5 years (residual value nil)
Aircraft engines and parts 5 - 15 years (residual value nil - 10%)
Goodwill and fair value adjustments arising on the acquisition of a foreign entity are Buildings 15 - 40 years
treated as assets and liabilities of the foreign entity and translated at the exchange rates Other property, plant and 3 - 20 years or over the lease term, if shorter
prevailing at the end of reporting period. Exchange differences arising are recognised in equipment
other comprehensive income. 8
103
THE EMIRATES GROUP
ANNUAL REPORT

2017-18

2. Summary of significant accounting policies (continued) Finance and operating leases

Property, plant and equipment (continued) Where property, plant and equipment has been financed by lease agreements under
which substantially all of the risks and rewards incidental to ownership are transferred to
Major overhaul expenditure is depreciated over the shorter of the period to the next Emirates, they are classified as finance leases. Finance leases are capitalised at the
major overhaul, the remaining lease term or the useful life of the asset concerned. commencement of the lease at the lower of the present value of the minimum lease
payments or the fair value of the leased asset. The corresponding lease obligations are
Overview
The assets’ residual values and useful lives are reviewed, and adjusted if appropriate, at included under liabilities. Lease payments are treated as consisting of capital and interest
Emirates the end of each reporting period. elements. The interest element is charged to the consolidated income statement over
the lease term so as to produce a constant periodic rate of interest on the remaining
dnata
Capital projects are stated at cost. When the asset is ready for its intended use, it is balance of the liability. Property, plant and equipment acquired under finance leases are
Group transferred from capital projects to the appropriate category under property, plant and depreciated in accordance with Emirates’ policies.
equipment and depreciated in accordance with Emirates’ policies.
Financial Leases, where a significant portion of risks and rewards of ownership are retained by the
Information
An item of property, plant and equipment is derecognised upon disposal or when no lessor, are classified as operating leases. Lease rental charges, including advance rentals
Emirates future economic benefits are expected from its use or disposal. Gains and losses on in respect of operating leases, are charged to the consolidated income statement on a
Financial disposals are determined by comparing proceeds with the carrying amount and are straight-line basis over the period of the lease.
Commentary
recognised in the consolidated income statement.
dnata
dnata Gains and losses arising on sale and leaseback transactions resulting in an operating
Financial
Financial Borrowing costs lease and where the sale price is at fair value, are recognised immediately in the
Commentary
Commentary
consolidated income statement. Where the sale price is below fair value, any losses are
Emirates
Emirates Borrowing costs directly attributable to the acquisition, construction or production of immediately recognised in the consolidated income statement, except where the loss is
Consolidated
Consolidated qualifying assets are added to the cost of the assets until such time that the assets are compensated for by future lease payments at below market price, it is deferred and
Financial
Financial
Statements
Statements substantially ready for their intended use. Where funds are borrowed specifically for the amortised in proportion to the lease payments over the period for which the asset is
purpose of obtaining a qualifying asset, any investment income earned on temporary expected to be used. Where the sale price is above fair value, the excess over fair value is
dnata surplus funds is deducted from borrowing costs eligible for capitalisation. In the case of accounted for as a deferred credit and amortised over the period for which the asset is
Consolidated
Financial general borrowings, a capitalisation rate, which is the weighted average rate of general expected to be used.
Statements borrowing costs, is applied to the expenditure on qualifying assets and included in the
cost of the asset. Lease classification is made at the inception of the lease. Lease classification is changed
Additional
Information only if, at any time during the lease, the parties to the lease agreement agree to change
Manufacturers' credits the provisions of the lease (without renewing it) in a way that it would have been
classified differently at inception had the changed terms been in effect at that time. The
Emirates receives credits from manufacturers in connection with the acquisition of revised agreement is considered as a new agreement and accounted for prospectively
certain aircraft and engines. Depending on their nature, these credits are either recorded over the remaining term of the lease.
as a reduction to the cost of the related aircraft and engines or reduced from ongoing
operating expenses. Where the aircraft are held under operating leases, credits received
relating to aircraft are deferred on the statement of financial position as deferred credits
and recognised on a straight-line basis over the period of the related lease.

9
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2017-18

2. Summary of significant accounting policies (continued) Impairment of non-financial assets

Goodwill Goodwill is not subject to amortisation and is tested annually for impairment. Other
non-financial assets are reviewed for impairment whenever events or changes in
Goodwill represents the excess of the aggregate of the consideration transferred, circumstances indicate that the carrying amount may not be recoverable. An impairment
amount of any non-controlling interest in the acquired entity and the acquisition-date loss is recognised for the amount by which the asset’s carrying amount exceeds its
fair value of any previous equity interest in the acquired entity over the fair value of the recoverable amount. The recoverable amount is the higher of an asset’s fair value less
Overview
net identifiable assets at the date of acquisition. costs to sell and value in use. For the purpose of assessing impairment, assets are
Emirates grouped at the lowest levels for which there are separately identifiable cash flows (cash
Goodwill is tested for impairment annually or more frequently if events or changes in generating units). Non-financial assets other than goodwill are reviewed at the end of
dnata
circumstances indicate a potential impairment and is carried at cost less accumulated each reporting period for possible reversal of the impairment loss.
Group impairment losses. For the purpose of impairment testing, goodwill is allocated to cash
generating units or a group of cash generating units that are expected to benefit from Loans and receivables
Financial the business combination in which the goodwill arose. An impairment loss is recognised
Information
when the carrying value of the cash generating units or a group of cash generating units Loans and receivables are non-derivative financial assets with fixed or determinable
Emirates exceeds its recoverable amount. Impairment losses on goodwill are not reversed. payments that are not quoted in an active market. Such amounts are initially recognised
Financial at fair value including transaction costs and subsequrently measured at amortised cost
Commentary
Gains and losses on the disposal of an entity include the carrying amount of goodwill using the effective interest method. The amounts are derecognised when rights to
dnata
dnata relating to the entity sold. receive cash flows have expired or have been transferred along with substantially all the
Financial
Financial risks and rewards of ownership.
Commentary
Commentary
Other intangible assets
Emirates
Emirates At the end of each reporting period, an assessment is made whether there is any
Consolidated
Consolidated Intangible assets are capitalised at cost only when future economic benefits are objective evidence of impairment. Where necessary, the carrying amount is written down
Financial
Financial
Statements
Statements probable. Cost includes the purchase price together with any directly attributable through the consolidated income statement to the present value of expected future cash
expenditure. flows discounted at the effective interest rate computed at initial recognition.
dnata
Consolidated
Financial In the case of internally developed computer software, development expenditure is
Statements capitalised if costs can be measured reliably, the product is technically and commercially
feasible, future economic benefits are probable, and there exists an intent and ability to
Additional
Information complete the development and to use or sell the asset. Other research and development
expenditure not meeting the criteria for capitalisation are recognised in the consolidated
income statement as incurred.

Intangible assets are amortised on a straight-line basis over their estimated useful lives
which are:

Service rights 15 years

Trade names 20 years
Contractual rights 15 years
Computer software 3-7 years

The intangible assets’ useful lives are reviewed, and adjusted if appropriate, at the end of
each reporting period.

10
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2017-18

2. Summary of significant accounting policies (continued) Changes in the fair value of derivative instruments that do not qualify for hedge
accounting are recognised immediately in the consolidated income statement.
Derivative financial instruments
Inventories
Derivative financial instruments are initially recognised at fair value on the date a
derivative contract is entered into and are subsequently remeasured at their fair value. Inventories are stated at the lower of cost and estimated net realisable value. Cost is
Derivatives are designated as a hedge of the exposure to variability in cash flows that is determined on the weighted average cost basis.
Overview
attributable to a particular risk associated with a recognised asset or liability or a highly
Emirates probable forecast transaction (cash flow hedge). Fair values are obtained from quoted Trade receivables
market prices or dealer quotes for similar instruments, discounted cash flow models and
dnata
option pricing models as appropriate. All derivatives are carried as assets when the fair Trade receivables are initially recognised at fair value and subsequently measured at
Group value is positive and as liabilities when the fair value is negative. amortised cost using the effective interest method, less provision for impairment. Where
there is objective evidence of amounts that are not collectible, a provision is made for
Financial Emirates’ criteria to account for a derivative financial instrument as a hedge include: the difference between the carrying amount and the present value of the estimated
Information
future cash flows, discounted at the original effective interest rate.
Emirates  formal documentation of the hedging instruments, hedged items, hedging objective,
Financial strategy and basis of measuring effectiveness all of which are prepared prior to Borrowings
Commentary
applying hedge accounting; and
dnata
dnata Borrowings are recognised initially at fair value, net of transaction costs incurred.
Financial
Financial  documentation showing that the hedge effectiveness is assessed on an ongoing Borrowings are subsequently measured at amortised cost with any difference between
Commentary
Commentary
basis and is determined to have been highly effective in offsetting the risk of the the proceeds (net of transaction costs) and the redemption value recognised in the
Emirates
Emirates hedged item throughout the reporting period. consolidated income statement over the period of the borrowings using the effective
Consolidated
Consolidated interest method.
Financial
Financial
Statements
Statements Changes in the fair value of derivatives that are designated and qualify as cash flow
hedges and that prove to be highly effective in relation to the hedged risk are Provisions
dnata recognised in other comprehensive income. When the forecasted transaction results in
Consolidated
Financial the recognition of a non-financial asset or a non-financial liability, the gains and losses Provisions are made when an obligation exists for a future liability in respect of a past
Statements previously recognised in other comprehensive income are re-classified and included in event and where the amount of the obligation can be reliably estimated.
the initial carrying amount of the asset or liability. These gains and losses are ultimately
Additional
Information recognised in the consolidated income statement in the same period during which the Provision for aircraft return conditions
asset or liability affects profit or loss. In all other cases, amounts previously recognised in
other comprehensive income are transferred to the consolidated income statement in Provision for aircraft return conditions represents the estimate of the cost to meet the
the period during which the forecasted transaction affects the consolidated income contractual lease end obligations on certain aircraft and engines held under operating
statement and are presented in the same line item as the gains and losses from hedged leases. The present value of the expected cost is recognised over the lease term
items. considering the existing fleet plan and long-term maintenance schedules.

When a cash flow hedging instrument expires or is sold, terminated or exercised, or

when a hedge no longer meets the criteria for hedge accounting under IAS 39, any
cumulative gain or loss existing in equity at that time is retained in equity and is
ultimately recognised in the consolidated income statement when the forecasted
transaction occurs. If a forecasted transaction is no longer expected to occur, the
cumulative gain or loss that was reported in equity is immediately transferred to the
consolidated income statement. The gain or loss on the ineffective portion is recognised
in the consolidated income statement.

11
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THE EMIRATES GROUP
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2017-18

2. Summary of significant accounting policies (continued) Cash and cash equivalents

Retirement benefit obligations Cash and cash equivalents comprise cash and liquid funds with an original maturity of
three months or less. Other bank deposits with maturity less than one year are classified
Emirates operates or participates in various end of service benefit plans, which are as short term bank deposits. Bank overdrafts are shown within current borrowings and
classified either as defined contribution or defined benefit plans. lease liabilities in the consolidated statement of financial position.
Overview
A defined contribution plan is a pension scheme under which Emirates pays fixed Segment reporting
Emirates contributions and has no legal or constructive obligation to pay further contributions if
the fund does not hold sufficient assets to settle the benefits relating to the employees’ Operating segments are reported in a manner consistent with the internal reporting
dnata
service in the current and prior periods. Contributions to the pension fund are charged provided to the chief operating decision maker. The chief operating decision maker is
Group to the consolidated income statement in the period in which they fall due. considered to be the Emirates’ leadership team who make strategic decisions and are
responsible for allocating resources and assessing performance of the operating
Financial A defined benefit plan is a plan which is not a defined contribution plan. The liability segments.
Information
recognised in the consolidated statement of financial position for a defined benefit plan
Emirates is the present value of the defined benefit obligation at the end of the reporting period Offsetting of financial assets and liabilities
Financial less the fair value of plan assets at that date. The defined benefit obligation is calculated
Commentary
by independent actuaries using the projected unit credit method. Financial assets and liabilities are offset and the net amount is reported in the
dnata
dnata consolidated statement of financial position only when there is a legally enforceable
Financial
Financial The present value of the defined benefit obligation is determined by discounting right to offset the recognised amounts and there is an intention to settle on a net basis
Commentary
Commentary
estimated future cash outflows using market yields at the end of the reporting period of or realise the asset and settle the liability simultaneously. The legally enforceable right
Emirates
Emirates high quality corporate bonds that are denominated in currency in which the benefits will must not be contingent on future events and must be enforceable in the normal course
Consolidated
Consolidated be paid and have terms approximating to the estimated term of the post-employment of business and in the event of default, insolvency or bankruptcy.
Financial
Financial
Statements
Statements benefit obligations.
Dividend distribution
dnata Actuarial gains and losses arising from changes in actuarial assumptions and experience
Consolidated
Financial adjustments are recognised in equity through the consolidated statement of Dividend distribution to Equity holders is recognised as a liability in the consolidated
Statements comprehensive income in the period in which they arise. financial statements in the period in which the dividends are approved.
Additional
Information Trade payables 3. Critical accounting estimates and judgements

Trade payables are recognised initially at fair value and subsequently measured at
amortised cost using the effective interest method.
Derecognition of financial assets and financial liabilities
Financial assets are derecognised only when the contractual rights to the cash flows
expire or substantially all the risks and rewards of ownership are transferred along with
the contractual rights to receive cash flows. Financial liabilities are derecognised only
when they are extinguished i.e. when the obligations specified in the contract are
discharged or cancelled or expire.
In the preparation of these consolidated financial statements, a number of estimates and
associated assumptions have been made relating to the application of accounting
policies and reported amounts of assets, liabilities, income and expense. The estimates
and associated assumptions are assessed on an ongoing basis and are based on
historical experience and other factors, including expectations of future events that are
believed to be reasonable under the circumstances. The following narrative addresses
the accounting policies that require subjective and complex judgements, often as a result
of the need to make estimates.

12
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2017-18

3. Critical accounting estimates and judgements (continued) Where Emirates enters into sale and leaseback transactions for aircraft, the timing and
amount of profit recognised on these transactions is subject to the fair value of the
Passenger and cargo revenue recognition aircraft at the time of sale. Judgement is required to estimate the fair value due to
diversity of inputs that goes into the determination of aircraft fair value which includes
Passenger and cargo sales are recognised as revenue when transportation is provided. references to third party valuations.
The value of unused revenue documents is held in the consolidated statement of
financial position under current liabilities as passenger and cargo sales in advance. Provision for aircraft return conditions
Overview
Unused revenue documents are recognised in the consolidated income statement as
Emirates revenue based on their terms and conditions and historical trends. The measurement of the provision for aircraft return conditions includes assumptions
relating to expected costs, escalation rates, discount rates commensurate with the
dnata Frequent flyer programme (‘Skywards’) expected obligation maturity and long-term maintenance schedules. An estimate is
Group therefore made at each reporting date to ensure that the provision corresponds to the
Emirates accounts for Skywards miles as a separately identifiable component of the sales
present value of the expected costs to be borne by Emirates. A significant level of
Financial
transaction in which they are granted. The consideration in respect of the initial sale is
judgement is exercised by management given the long-term nature and diversity of
Information allocated to Skywards miles based on their fair value and is accounted as a liability
assumptions that go into the determination of the provision. No reasonably possible
(deferred revenue) in the consolidated statement of financial position.
Emirates change in any single assumption will result in a material change to the provision.
Financial
Commentary Estimation techniques are used to determine the fair value of Skywards miles and reflect
Valuation of defined benefit obligations
the weighted average of a number of factors i.e. fare per sector, flight upgrades and
dnata
dnata
Financial
Financial partner rewards using historical trends. Adjustments to the fair value of miles are also
The present value of the defined benefit obligations is determined on an actuarial basis
Commentary
Commentary made for miles not expected to be redeemed by members and the extent to which the
using various assumptions that may differ from actual developments in the future. These
demand for an award cannot be met.
Emirates
Emirates assumptions include the determination of the discount rate and expected salary
Consolidated
Consolidated
increases which are reviewed at each reporting date. Due to the complexities involved in
Financial
Financial A level of judgement is exercised by management due to the diversity of inputs that go
Statements
Statements the valuation and its long-term nature, defined benefit obligations are sensitive to
into determining the fair value of miles. No reasonably possible change in any single
changes in these assumptions. A sensitivity analysis of changes in defined benefit
dnata assumption will result in a material change to the deferred revenue.
obligations due to a reasonably possible change in these assumptions is set out in Note
Consolidated
Financial 25.
Statements
Useful lives and residual values of aircraft and related assets

Management assigns useful lives and residual values to aircraft and related assets based
Additional
Information on the intended use and the economic lives of those assets. Subsequent changes in
circumstances such as technological advances or prospective utilisation of the assets
concerned could result in the actual useful lives or residual values differing from initial
estimates.
Aircraft finance and operating lease classification
A lease is classified as a finance lease when substantially all the risks and rewards of
ownership of an aircraft are transferred to Emirates. In determining the appropriate lease
classification, the substance of the transaction rather than the legal form is considered.
Factors considered include but are not limited to the following: whether the lease
transfers ownership of the aircraft to Emirates by the end of the lease term; Emirates has
the option to purchase the aircraft at a price that is sufficiently lower than the fair value
on exercise date; the lease term is for the major part of the economic life of the aircraft
and the present value of the minimum lease payments amount to at least substantially
all of the fair value of the leased aircraft.
108
4. Fair value estimation
The levels of fair value hierarchy are defined as follows:
Level 1: Measurement is made by using quoted prices (unadjusted) from an active
market.
Level 2: Measurement is made by means of valuation methods with parameters
derived directly or indirectly from observable market data.
Level 3: Measurement is made by means of valuation methods with parameters not
based exclusively on observable market data.
Derivatives are the only financial instruments which are carried at fair value and fall into
level 2 of the fair value hierarchy (Note 35).
Derivatives comprise forward exchange contracts and interest rate swaps. The forward
exchange contracts have been fair valued using forward exchange rates that are quoted
in an active market. Interest rate swaps are fair valued using forward interest rates
extracted from observable yield curves.
13
 THE EMIRATES GROUP
ANNUAL REPORT

2017-18

5. Revenue 7. Operating costs 7. Operating costs

Revenue
2018 2017 2018 2017 2018 2017 2018 20

AED m AED m AED m AED m AED m AED m AED m AED

senger Passenger 73,963 68,491 73,963 68,491 Jet fuel Jet fuel 24,715 20,968 24,715 20,9

go Cargo 12,439 10,592 12,439 10,592 Employee (see (a) below) Employee (see (a) below) 13,080 12,864 13,080 12,8
Overview
nsumer goods Consumer goods 1,625 1,638 1,625 1,638 Aircraft operating leases Aircraft operating leases 11,691 10,509 11,691 10,5

el operations
Emirates Hotel operations 746 738 746 738 Depreciation and
Depreciation and amortisation (Notes 11 & 12) amortisation (Notes 11
9,193& 12) 8,304 9,193 8,3

d and beverage Food and beverage 680 616 680 616 Sales and marketing Sales and marketing 6,404 5,698 6,404 5,6
dnata
ering operations Catering operations 677 678 677 678 Handling Handling 5,335 5,885 5,335 5,8
Group
ess baggage Excess baggage 433 392 433 392 In-flight costs
In-flight catering and other operating catering and other operating costs
3,323 3,343 3,323 3,3
Financial Others 662 687 Overflying 2,891 2,8
ers Information 662 687 Overflying 2,891 2,851
91,225 83,832 91,225 83,832 Facilities
Facilities and IT related costs (see and IT related costs (see (b)2,485
(b) below) below) 2,470 2,485 2,4
Emirates
Financial Aircraft maintenance Aircraft maintenance 2,364 2,738 2,364 2,7
Commentary
Other operating income 6. Other operating income Landing and parking Landing and parking 2,153 2,057 2,153 2,0
dnata
dnata
Cost of goods sold Cost of goods sold 1,575 1,499 1,575 1,4
er Financial
Financial
operating income Other operating
comprises AED 145 m income
(2017:comprises AEDfrom
AED 312 m) 145 liquidated
m (2017: AED 312 m) from liquidated
Commentary
Commentary Crew layover 1,125 1,0
mages and other compensation received in connection with aircraft, AEDconnection
damages and other compensation received in 292 m with aircraft, AED 292 m Crew layover 1,125 1,082
Emirates
Emirates (2017: AED 205 m) being the amortisation of gain on
17: AED 205 m) being the amortisation of gain on sale and leaseback of aircraft,sale and leaseback of aircraft, Foreign exchange loss - net Foreign exchange loss - net - 362 - 3
Consolidated
Consolidated
raftFinancial
engines and
Financial aircraft
parts, a net engines
foreign and parts,
exchange a net
gain of AEDforeign exchange
33 m (2017: Nil) gain
and of AED 33 m (2017: Nil) and Corporate overheads Corporate overheads 1,902 2,018 1,902 2,0
Statements
Statements
income of AED 627 m (2017: AED 734 m)
ome of AED 627 m (2017: AED 734 m) from ancillary services and activities from ancillary services and activities 88,236 82,6
88,236 82,648
incidental
dental to Emirates' operations.
dnata to Emirates' operations.
Consolidated
Financial (a) Employee costsAED
include AEDin732 m (2017: AED 741 m) in respect of retirem
Statements (a) Employee costs include AED 732 m (2017: 741 m) respect of retirement
benefit obligations (Note 25). benefit obligations (Note 25).
Additional
Information
(b) Facilities and IT related(b)costs
Facilities
include andnon-aircraft
IT related operating
costs include
leasenon-aircraft
charges operating lease charg
amounting
amounting to AED 724 m (2017: AED 705 m). to AED 724 m (2017: AED 705 m).

14 14
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 THE EMIRATES GROUP
ANNUAL REPORT

2017-18

inance income and costs8. Finance income and costs 9. Income tax expense 9. Income tax expense
2018 2017 2018 2017 2018 2017 2018 20
AED m AED m AED m AED m AED m AED m AED m AED
ance income Finance income Current income tax expense Current income tax expense 44 40 44 4
Interest(Note
rest income from related parties income
37)from related parties (Note
216 37) 159 216 159 44 40 44 4
restOverview
income on short termInterest income on short term bank deposits
bank deposits 159 122 159 122
Emirates 375 281 375 281 Emirates has
Emirates has secured tax exemptions secured
by virtue tax exemptions
of double taxation by virtue of double
agreements and taxation agreements a
ancednata
costs Finance costs airline
airline reciprocal arrangements reciprocal
in most arrangements
of the jurisdictions inin most
whichofit the jurisdictions in which it operat
operates.
Aircraft finance lease costs (1,216) (1,019) Therefore,relates
Therefore, the income tax expense the income
only totax expense
certain relatesstations
overseas only toof certain overseas stations
raft finance lease costs (1,216) (1,019)
Group Emirates' operations and its Emirates' operations
subsidiaries and its is
where Emirates subsidiaries
subject towhere
income Emirates
tax. is subject to income t
Interest
rest expense on bonds and expense on bonds and term loans
term loans (146) (147) (146) (147)
Financial Providing
Providing information on effective information
tax rates on effective
is therefore tax rates is therefore not meaningful.
not meaningful.
er finance costs
Information - net Other finance costs - net (231) (217) (231) (217)
(1,593) (1,383) (1,593) (1,383)
Emirates
Financial
Commentary

dnata
dnata
Financial
Financial
Commentary
Commentary

Emirates
Emirates
Consolidated
Consolidated
Financial
Financial
Statements
Statements

dnata
Consolidated
Financial
Statements

Additional
Information

110 15 15
 THE EMIRATES GROUP
ANNUAL REPORT

2017-18

Segment information The segment information for thesegment

year ended 31 Marchfor
2018
10. Segment information The information theisyear
as follows:
ended 31 March 2018 is as follows:

ates' leadership team monitors theleadership

Emirates' operatingteam
results of its business
monitors units for
the operating the of its business units for the
results Catering Recon-
Catering Recon-
ose of making decisionspurpose
about resource allocation and performance assessment.
of making decisions about resource allocation and performance assessment. Airline operations Other ciliation
Airline operations TotalOther ciliation T
airline business unit, which provides
The airline commercial
business air transportation
unit, which including air transportation including
provides commercial AED m AED m AED m
AED m AED m AED m AED m
AED m AED m AE
enger, cargo services andpassenger,
excess baggage, is the main
cargo services andreportable segment.
excess baggage, Catering
is the main reportable segment. Catering
Overview Total segment revenue 88,008
Total 2,709
segment revenue 3,085
88,008 (321)2,709 93,4813,085 (321) 93
ations is another reportable segment
operations which provides
is another reportablein-flight
segmentandwhich
institutional
provides in-flight and institutional Inter-segment revenue -
Inter-segment (2,032)
revenue (224) - -(2,032) (2,256)(224) - (2
ingEmirates
services. 'Other' comprises of various businesses not allocated to a reportablenot allocated to a reportable
catering services. 'Other' comprises of various businesses Revenue from external Revenue from external
ment.
dnata segment. customers 88,008
customers 677 2,861
88,008 (321) 677 91,2252,861 (321) 91
performance of the airline and
The catering operations
performance is evaluated
of the airline basedoperations
and catering on segment
is evaluated based on segment
Group Segment profit for the Segment profit for the
t or loss and is measured consistently with profit for the year in the consolidated
profit or loss and is measured consistently with profit for the year in the consolidated
year year2,286 260 4332,286 - 260 2,979 433 - 2
cialFinancial
statements. financial statements.
Information Finance income 373income 6 2 373 (6) 6 375
Finance 2 (6)
mentEmirates
revenue is measured in a manner
Segment revenueconsistent with inthat
is measured in the consolidated
a manner consistent with that in the consolidated Finance costs (1,592)
Finance costs - (7)
(1,592) 6 - (1,593) (7) 6 (1
Financial
me Commentary
statement, with the income
exception
statement, with the exceptioncosts
of notional revenues and in the airline
of notional revenues and costs in the airline Income tax (expense) / Income tax (expense) /
ment arising from the usage of transportation
segment arising fromservices e.g.of
the usage leave passage of services
transportation staff ande.g. leave passage of staff and credit credit (51) - 7 (51) - - (44) 7 -
dnata
dnata
travel of staff and consultants
Financial
Financial that are
duty travel eliminated
of staff when preparing
and consultants that arethe consolidated
eliminated when preparing the consolidated Depreciation and Depreciation and
Commentary
cialCommentary
statements. This adjustment is presented as a reconciling item. The breakdown amortisation
financial statements. This adjustment is presented as a reconciling item. The breakdown (8,874)
amortisation (126) (193)
(8,874) - (126) (9,193)(193) - (9
venue from external customers
Emirates
Emirates by nature
of revenue of business
from external activity by
customers is provided
nature ofinbusiness
Note 5. activity is provided in Note 5.
Share of results of Share of results of
Consolidated
Consolidated
Financial
Financial investments accounted for investments accounted for
mentStatements
assets include
Statements inter-segment loans include
Segment assets and receivables, which loans
inter-segment are eliminated on
and receivables, which are eliminated on using the equity method using the
olidation. This consolidation adjustment is presented as a reconciling item. - equity method
- 155 - - - 155 155 -
dnata consolidation. This consolidation adjustment is presented as a reconciling item.
Consolidated Segment assets 119,670 assets 3,101
Segment 5,563
119,670 (747)3,101127,5875,563 (747) 127
Financial
Statements Investments accounted for Investments accounted for
using the equity method using the
- equity method
Additional
Information - 662 - - - 662 662 -
Additions to property, Additions to property,
plant and equipment 8,083
plant 136
and equipment 688,083 - 136 8,287 68 - 8
Additions to intangible Additions to intangible
assets (including assets (including
acquisitions) 193 5 23 193 - 5 221 23 -
acquisitions)
Additions to advance lease Additions to advance lease
rentals 1,286
rentals - - 1,286 - - 1,286 - - 1

16 16 111
 THE EMIRATES GROUP
ANNUAL REPORT

2017-18

Segment information (continued)

10. Segment information (continued) Geographical information Geographical information
2018 2017 2018
segment information for thesegment
The year ended 31 Marchfor
information 2017
theisyear
as follows:
ended 31 March 2017 is as follows:
AED m AED m AED m A

Recon- Revenue from external customers:

Revenue from external customers:
Catering Catering Recon-
Airline operations Other ciliation Europe Europe 26,727 23,906 26,727 23
Airline operations TotalOther ciliation Total
Overview AED m AED m AED m
AED m AED m AED m AED m
AED m AED m AED m East Asia and Australasia East Asia and Australasia 25,409 22,621 25,409 22
segment
Emirates revenue 80,714 2,761 3,012 (354)2,761 86,1333,012 Americas Americas 13,441 12,504 13,441 12
Total segment revenue 80,714 (354) 86,133
-segment Africa Africa 9,343 8,693 9,343 8
dnata revenue -
Inter-segment (2,083)
revenue (218) - -(2,083) (2,301)(218) - (2,301)
nue from external Revenue from external Gulf and Middle East Gulf and Middle East 8,544 8,682 8,544 8
Group
omers 80,714
customers 678 2,794
80,714 (354) 678 83,8322,794 (354) 83,832 West Asia and Indian Ocean West Asia and Indian Ocean 7,761 7,426 7,761 7
mentFinancial
profit for the Segment profit for the 91,225 83,832
Information 91,225 83
year 656 285 509 656 - 285 1,450 509 - 1,450
Emirates
nce Financial
income 279income
Finance 7 1 279 (6) 7 281 1 (6) 281 Revenue from inbound and Revenue
outboundfromairline operations
inbound between the
and outbound UAEoperations
airline and the between the UAE and
Commentary
nce costs (1,382)
Finance costs - (7)
(1,382) 6 - (1,383) (7) 6 (1,383) overseas point is attributed to the geographical
overseas area in which
point is attributed to thethe respective area
geographical overseas
in which the respective ove
me dnata
tax (expense) /
dnata Income tax (expense) / points are located. Revenuepointsfrom are
other segments
located. is reported
Revenue basedsegments
from other upon theis reported based upon
Financial
Financial
t Commentary
Commentary credit (45) - 5 (45) - - (40) 5 - (40) geographical area in which sales are made or
geographical services
area aresales
in which rendered.
are made or services are rendered.
eciation and Depreciation and
Emirates
Emirates The major revenue earning asset
rtisation (7,971)
amortisation (140) (193) - (140) (8,304)(193) Theismajor
the aircraft
revenue fleet, whichasset
earning is registered in thefleet,
is the aircraft UAE.which
Sinceis registered in the UAE.
Consolidated
Consolidated (7,971) - (8,304)
Financial
Financial the aircraft fleet is deployed
the flexibly
aircraft across
fleet isEmirates'
deployedroute network,
flexibly across providing
Emirates' route network, prov
e ofStatements
results of
Statements Share of results of information on non-current assets by geographical areas is not considered meaningful.
information on non-current assets by geographical areas is not considered meaning
tments
dnata
accounted for investments accounted for
g the equity method
Consolidated using the
Financial - equity method
- 157 - - - 157 157 - 157 No single external customer contributes 10% or more
No single external of Emirates'
customer revenues.
contributes 10% or more of Emirates' revenues.
Statements
ment assets 113,388 assets 3,274
Segment 5,569
113,388 (673)3,274121,5585,569 (673) 121,558
Additional
tments accounted
Information for Investments accounted for
g the equity method using the equity method
- - 676 - - - 676 676 - 676
tions to property, Additions to property,
and equipment 11,788
plant 465
and equipment 110
11,788 - 465 12,363 110 - 12,363
tions to intangible Additions to intangible
s assets269 - - 269 - - 269 - - 269
tions to advance lease Additions to advance lease
als 2,438
rentals - - 2,438 - - 2,438 - - 2,438

112
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ANNUAL REPORT

2017-18

11. Property, plant and equipment

Other
Aircraft Land property,
engines and plant and Capital
Aircraft and parts buildings equipment projects Total
AED m AED m AED m AED m AED m AED m
Overview
Cost
Emirates 1 April 2016 66,083 6,295 12,874 14,580 12,976 112,808
dnata Additions 5 31 9 3,363 8,955 12,363

Group
Transfer from capital projects 10,402 992 1,149 370 (12,913) -
Disposals / write-offs (315) (419) - (3,156) - (3,890)
Financial
Information Currency translation differences - - 1 (3) (1) (3)

Emirates
31 March 2017 76,175 6,899 14,033 15,154 9,017 121,278
Financial Accumulated depreciation
Commentary
1 April 2016 15,567 1,848 3,377 9,180 - 29,972
dnata
dnata
Financial
Financial Charge for the year 4,283 405 560 2,926 - 8,174
Commentary
Commentary
Disposals / write-offs (281) (409) - (3,074) - (3,764)
Emirates
Emirates Currency translation differences - - - (2) - (2)
Consolidated
Consolidated
Financial
Financial 31 March 2017 19,569 1,844 3,937 9,030 - 34,380
Statements
Statements
Net book amount
dnata
Consolidated 31 March 2017 56,606 5,055 10,096 6,124 9,017 86,898
Financial
Statements

Additional
Information

18

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11. Property, plant and equipment (continued)

Other
Aircraft Land property,
engines and plant and Capital
Aircraft and parts buildings equipment projects Total
AED m AED m AED m AED m AED m AED m
Overview
Cost
Emirates
1 April 2017 76,175 6,899 14,033 15,154 9,017 121,278
dnata Additions - 189 14 3,354 4,730 8,287

Group Transfer from capital projects 5,152 303 919 354 (6,728) -
Disposals / write-offs (339) (300) (5) (1,968) - (2,612)
Financial
Information 31 March 2018 80,988 7,091 14,961 16,894 7,019 126,953

Emirates
Accumulated depreciation
Financial 1 April 2017 19,569 1,844 3,937 9,030 - 34,380
Commentary
Charge for the year 4,808 412 598 3,210 - 9,028
dnata
dnata
Financial
Financial Disposals / write-offs (310) (156) (5) (1,935) - (2,406)
Commentary
Commentary
31 March 2018 24,067 2,100 4,530 10,305 - 41,002
Emirates
Emirates Net book amount
Consolidated
Consolidated
Financial
Financial
Statements
Statements
31 March 2018 56,921 4,991 10,431 6,589 7,019 85,951

dnata The net book amount of property, plant and equipment includes AED 53,164 m (2017: AED 54,148 m) in respect of assets held under
Consolidated
Financial
finance leases.
Statements
The net book amount of aircraft includes an amount of AED 5,671 m (2017: AED 3,953 m) in respect of assets provided as security against
Additional term loans.
Information

Land of AED 922 m (2017: AED 861 m) is carried at cost and is not depreciated.

Property, plant and equipment includes interest capitalised during the year amounting to AED 163 m (2017: AED 226 m). The interest on
general borrowings for qualifying assets was capitalised using an annual weighted average capitalisation rate of 4.1% (2017: 4.0%).

Capital projects include pre-delivery payments of AED 4,560 m (2017: AED 5,855 m) in respect of aircraft due for delivery between 2019 and
2028 (Note 32).

The net book amount of other property, plant and equipment includes AED 4,578 m (2017: AED 3,954 m) pertaining to aircraft and engine
related overhauls.

19

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12. Intangible assets

Service Trade Contractual Computer
Goodwill rights names rights software Total

AED m AED m AED m AED m AED m AED m

Cost

Overview
1 April 2016 597 232 19 56 1,226 2,130
Additions - 50 - - 219 269
Emirates
Disposals / write-offs - - - - (97) (97)
dnata
Currency translation differences - - - - 3 3
Group 31 March 2017 597 282 19 56 1,351 2,305

Financial Accumulated amortisation and impairment

Information
1 April 2016 - 120 6 11 676 813
Emirates Amortisation for the year - 17 2 5 106 130
Financial
Commentary Disposals / write-offs - - - - (81) (81)
Currency translation differences - - - - 2 2
dnata
dnata
Financial
Financial 31 March 2017 - 137 8 16 703 864
Commentary
Commentary
Net book value
Emirates
Emirates
Consolidated
Consolidated 31 March 2017 597 145 11 40 648 1,441
Financial
Financial
Statements
Statements

dnata
Consolidated
Financial
Statements

Additional
Information

20

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12. Intangible assets (continued)

Service Trade Contractual Computer
Goodwill rights names rights software Total
AED m AED m AED m AED m AED m AED m
Cost
1 April 2017 597 282 19 56 1,351 2,305
Overview
Additions - - - - 209 209
Emirates Acquisitions 12 - - - - 12
Disposals / write-offs - - - - (3) (3)
dnata
Currency translation differences - - - 1 - 1
Group 31 March 2018 609 282 19 57 1,557 2,524
Financial
Accumulated amortisation and impairment
Information 1 April 2017 - 137 8 16 703 864

Emirates
Amortisation for the year - 19 1 5 140 165
Financial Disposals / write-offs - - - - (1) (1)
Commentary
31 March 2018 - 156 9 21 842 1,028
dnata
dnata Net book value
Financial
Financial
Commentary
Commentary 31 March 2018 609 126 10 36 715 1,496

Emirates
Emirates Computer software includes an amount of AED 212 m (2017: AED 215 m) in respect of projects under implementation.
Consolidated
Consolidated
Financial
Financial For the purpose of testing goodwill impairment, the recoverable amounts for cash generating units have been determined on the basis of
Statements
Statements
value-in-use calculations using cash flow forecasts approved by management covering a three year period. Cash flows beyond the three
dnata year period have been extrapolated using the long term terminal growth rates. The key assumptions used in the value-in-use calculations
Consolidated
Financial include a risk adjusted pre-tax discount rate of 12% (2017: 12%), gross margins consistent with historical trends and growth rates based on
Statements
management's expectations for market development. The long term growth rate does not exceed the long term average growth rate for the
Additional markets in which the cash generating units operate. Any reasonably possible changes to the assumptions will not lead to an impairment
Information charge. The goodwill allocated to the cash generating unit or groups of cash generating units is as follows:

Cash generating unit Location Reportable segment Goodwill

2018 2017
AED m AED m
Catering operations UAE Catering operations 369 369
Consumer goods UAE Others 212 200
Food and beverage UAE Others 25 25
Food and beverage Australia Others 3 3
609 597

21

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13. Investments in subsidiaries, associates and joint ventures

Country of
Percentage of incorporation
beneficial Percentage of and principal
interest equity owned Principal activities operations
Principal subsidiaries
Overview
Wholesale and retail of consumer
Emirates Maritime & Mercantile International L.L.C. 68.7 68.7 goods UAE
Maritime & Mercantile International Holding
dnata
L.L.C. 100 100 Holding company UAE
Group
Emirates Leisure Retail Holding L.L.C. 100 100 Holding company UAE
Financial Emirates Leisure Retail L.L.C. 68.7 68.7 Food and beverage operations UAE
Information
Emirates Leisure Retail (Singapore) Pte Ltd. 100 100 Food and beverage operations Singapore
Emirates
Financial Emirates Leisure Retail (Australia) Pty Ltd. 100 100 Food and beverage operations Australia
Commentary
Emirates Hotel L.L.C. 100 100 Hotel operations UAE
dnata
dnata Emirates Hotels (Australia) Pty Ltd. 100 100 Hotel operations Australia
Financial
Financial
Commentary
Commentary Emirates Flight Catering Company L.L.C. 90 90 In-flight and institutional catering UAE

Emirates
Emirates None of the subsidiaries have non-controlling interests that are material to Emirates.
Consolidated
Consolidated
Financial
Financial
Statements
Statements Principal joint ventures
dnata Emirates-CAE Flight Training L.L.C. 50 51 Flight simulator training UAE
Consolidated
Financial Premier Inn Hotels L.L.C. 51 51 Hotel operations UAE
Statements
CAE Flight Training (India) Private Ltd. 50 50 Flight simulator training India
Additional CAE Middle East Holdings Limited 50 50 Flight simulator training UAE
Information
Independent Wine and Spirit (Thailand) Wholesale and retail of consumer
Company Limited 49 49 goods Thailand
Wholesale and retail of consumer
Arabian Harts International Limited 50 50 goods UAE

Premier Inn Hotels L.L.C. and Independent Wine and Spirit (Thailand) Company Limited are subject to joint control and, therefore, these
investments are accounted for as joint ventures.

22

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 THE EMIRATES GROUP
ANNUAL REPORT

2017-18

nvestments in subsidiaries, associates and

13. Investments joint ventures
in subsidiaries, (continued)
associates and joint ventures (continued) No individual joint venture is No
material to Emirates.
individual The aggregate
joint venture is materialfinancial information
to Emirates. The aggregate financial informat
of joint ventures is set out below:
of joint ventures is set out below:

vement of investments accounted

Movementfor
of using the equity
investments methodfor using the equity method
accounted 2018 2017 2018 20
2018 2017 2018 2017 AED m AED m AED m AED
AED m AED m AED m AED m Share of results of joint ventures 70 63
Share of results of joint ventures 70
nceOverview
brought forward Balance brought forward 676 522 676 522 Share of total comprehensive income
Share of joint
of total ventures income 70
comprehensive 63
of joint ventures 70
stments during the year Investments during the year
Emirates 5 137 5 137
e ofdnata
results Share of results 155 157 155 157 Aggregate carrying valueAggregate
of investments
carryingin value
joint of investments in joint
dends Dividends (175) (140) (175) (140) ventures ventures 612 621 612 6
Group
ency translation differences
Currency translation differences 1 - 1 -
Financial
nceInformation
carried forward Balance carried forward 662 676 662 676 14. Advance lease rentals 14. Advance lease rentals
2018 2017 2018 20
Emirates
ndividual
Financialassociate is material to Emirates.
No individual The aggregate
associate is materialfinancial information
to Emirates. of
The aggregate financial information of AED m AED m AED m AED
Commentary
ciates is set out below: associates is set out below: Balance brought forward Balance brought forward 4,901 2,886 4,901 2,8
dnata
dnata
Financial
Financial Additions during the year Additions during the year 1,286 2,438 1,286 2,4
Commentary
Commentary 2018 2017 2018 2017
Charge for the year Charge for the year (536) (423) (536) (4
Emirates
Emirates
AED m AED m AED m AED m
Balance carried forward Balance carried forward 5,651 4,901 5,651 4,9
Consolidated
Consolidated
e ofFinancial
results of associates Share of results of associates 85 94 85 94
Financial Advance lease rentals will be Advance
charged to the rentals
lease consolidated
will be charged to the consolidated
Statements
Statements
re of total comprehensive income
Share of associates
of total comprehensive income 85
of associates 94 85 94 income statement as follows: income statement as follows:
dnata Within one year (Note 17) Within one year (Note 17) 586 480
Consolidated
586 4
regate carrying
Financial value ofAggregate
investments in associates
carrying 50 in associates
value of investments 55 50 55 Over one year Over one year 5,065 4,421 5,065 4,4
Statements

Additional Advance lease rentals are non-refundable

Advance lease in the event
rentals of the related in
are non-refundable lease
the being
event of the related lease be
Information terminated prior to its expiry.terminated prior to its expiry.

Advance lease rentals include AED 275

Advance m (2017:
lease rentalsAED 314 AED
include m) related
275 mto a company
(2017: AED 314 m) related to a comp
under common control. under common control.

118 23 23
 THE EMIRATES GROUP
ANNUAL REPORT

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15. Loans and other receivables

oans and other receivables 16. Inventories 16. Inventories
2018 2017 2018 2017 2018 2017 2018 20
AED m AED m AED m AED m AED m AED m AED m AED
ed parties (Note 37) Related parties (Note 37) 8 11 8 11 In-flight consumables In-flight consumables 1,247 1,065 1,247 1,0
r receivables Other receivables 64 93 64 93 Engineering Engineering 495 572 495 5
Overview 72 104 Consumer goods 477 4
72 104 Consumer goods 477 449
ayments
Emirates Prepayments 100 134 100 134 Others Others 168 152 168 1

dnata 172 238 172 238 2,387 2,238 2,387 2,2

The amounts
amounts (excluding prepayments) (excludingas
are receivable prepayments) are receivable as
Group
ws: follows: In-flight consumables includeIn-flight
AED 836 consumables
m (2017: AEDinclude
648 m)AED 836 mto(2017:
relating itemsAED 648 m) relating to items wh
which
eenFinancial
2 and 5 years Between 2 and 5 years 72 104 72 104 are not
are not expected to be consumed expected
within twelvetomonths
be consumed
after thewithin twelve
reporting months after the reporting period.
period.
Information
72 104 72 104
Emirates 17. Trade and other receivables
17. Trade and other receivables
s and other receivables Loans
Financial and other
(excluding receivables
prepayments) are (excluding prepayments) are
Commentary
ominated in the followingdenominated
currencies: in the following currencies: 2018 2017 2018 20

UAE Dirham 67 81 AED m AED m AED m AED

Dirham
dnata
dnata 67 81
Financial
Financial
ollar
Commentary
Commentary US Dollar 1 15 1 15 Trade receivables - net of provision 5,743
Trade receivables - net of provision 4,644 5,743 4,6

rs Others 4 8 4 8 Prepayments Prepayments 3,081 2,748 3,081 2,7

Emirates
Emirates
Consolidated
Consolidated Related parties (Note 37) Related parties (Note 37) 229 199 229 1
Financial
Financial
Statements
Statements The receivables
air value of loans and other fair value of(excluding
loans andprepayments)
other receivables (excluding
amounts to AEDprepayments) amounts to AED Advance lease rentals (Note 14)
Advance lease rentals (Note 14) 586 480 586 4
dnata AED 103 m). Fair 71
m (2017: m (2017:
value AED 103by
is determined m).discounting
Fair value isprojected
determined
cashbyflows
discounting projected cash flows Operating lease and other deposits
Operating lease and other deposits 779 896 779 8
Consolidated
g the using for
interest rate yield curve the the
interest rate yield
remaining termcurve for the and
to maturity remaining term to maturity and currencies
currencies Other receivables Other receivables 1,108 1,193 1,108 1,1
Financial
d on based at
credit spreads applicable
Statements onthe
credit
endspreads
of eachapplicable
reporting at the end
period. Theoffair
each reporting period. The fair value
value 11,526 10,1
11,526 10,160
and other receivablesoffalls
ansAdditional loans
intoand other
level 2 ofreceivables fallshierarchy.
the fair value into level 2 of the fair value hierarchy.
Less:
Less: Receivables over one year Receivables
(Note 15) over one year (Note 15)
(172) (238) (172) (2
Information
11,354 9,922 11,354 9,9
The maximum
maximum exposure to credit risk at the exposure
reporting to credit
date riskcarrying
is the at the reporting date is the carrying value of the
value of the
s and other receivables loans and other
(excluding receivables
prepayments). At (excluding
the end ofprepayments).
the reportingAt the end of the reporting
period, loans
od, loans and other receivables and other
(excluding receivables
prepayments) (excluding
were prepayments)
neither past due were neither past due Prepayments
Prepayments include an amount include
of AED 68 an amount
m (2017: AED 52 of
m)AED
paid68
to m (2017: AED 52 m) paid to compan
companies
mpaired. nor impaired. under common control. under common control.

The carrying amount of tradeTheand

carrying
other amount of trade
receivables and other
(excluding receivables
prepayments and(excluding prepayments
advancetheir
advance lease rentals) approximates leasefair
rentals)
value approximates their
which falls into fair2 value
level of thewhich
fair falls into level 2 of the
value hierarchy. value hierarchy.

24 24 119
 THE EMIRATES GROUP
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2017-18

Trade and other receivables (continued)

17. Trade and other receivables (continued) The ageing of trade receivables
Thethat are past
ageing due receivables
of trade but not impaired is as
that are follows:
past due but not impaired is as follows:
2018 2017 2018 20
ements in the provision for impairment
Movements of trade
in the receivables
provision are as follows:
for impairment of trade receivables are as follows: AED m AED m AED m AED
2018 2017 2018 2017 Below 3 months Below 3 months 677 398 677 3
AED m AED m AED m AED m 3-6 months 3-6 months 51 63 51
nceOverview
brought forward Balance brought forward 83 104 83 104 Above 6 months Above 6 months 47 24 47
ge Emirates
for the year Charge for the year 74 63 74 63 775 485 775 4
seddnata
amounts reversed Unused amounts reversed (54) (40) (54) (40)
For further details on credit risk
Formanagement,
further detailsrefer to Note
on credit risk38.
management, refer to Note 38.
ounts written off as uncollectible
Amounts written off as uncollectible (24) (39) (24) (39)
Group
ency translation differences
Currency translation differences 2 (5) 2 (5)
Financial
nceInformation
carried forward Balance carried forward 81 83 81 83

Emirates
impairment
Financial charge on trade receivables charge
The impairment recognised in thereceivables
on trade consolidated income in the consolidated income
recognised
Commentary
ement during the year mainly relates
statement to ticketing
during the yearagents
mainlywho are to
relates in unexpected
ticketing agents who are in unexpected
cult dnata
economic situations and
dnata are economic
difficult unable to situations
meet theirand
obligations under
are unable the IATA
to meet their obligations under the IATA
Financial
Financial
ncy Commentary
programme.
Commentary
This charge
agencyis included in
programme. operating
This costs.
charge is Amounts
included charged
in to costs. Amounts charged to
operating
provision account are written off when account
the provision there is no
areexpectation of further
written off when thererecovery.
is no expectation of further recovery.
Emirates
Emirates
Consolidated
Consolidated
Financial
other classes of
Financial trade andThe
other receivables
other classes ofdo not and
trade contain impaired
other assets.
receivables do not contain impaired assets.
Statements
Statements

maximum
dnata exposure to credit risk of trade
The maximum and other
exposure receivables
to credit risk of at the and
trade reporting
other receivables at the reporting
is Consolidated
the carrying value ofdate
eachis class of receivable
the carrying value (excluding prepayments
of each class and(excluding prepayments and
of receivable
Financial
anceStatements
lease rentals). advance lease rentals).

Additional
Information

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THE EMIRATES GROUP
ANNUAL REPORT

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18. Capital

Capital represents the permanent capital of Emirates.

19. Other reserves

Overview
Cash flow Translation
hedge reserve reserve Total
Emirates
AED m AED m AED m
dnata
1 April 2016 (1,181) 2 (1,179)
Group Net gain on fair value of cash flow hedges 478 - 478

Financial Transferred to the consolidated income statement 560 - 560

Information
31 March 2017 (143) 2 (141)
Emirates Currency translation differences - 1 1
Financial
Commentary Net gain on fair value of cash flow hedges 54 - 54

dnata
dnata
Transferred to the consolidated income statement 101 - 101
Financial
Financial 31 March 2018 12 3 15
Commentary
Commentary

Emirates
Emirates
Consolidated
Consolidated The amounts transferred to the consolidated income statement have been (debited)/credited to the following line items:
Financial
Financial
Statements
Statements
2018 2017
dnata
Consolidated AED m AED m
Financial
Statements Revenue - (41)
Operating costs 2 (359)
Additional
Information Finance costs (103) (160)
(101) (560)

26

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20. Borrowings and lease liabilities

Borrowings and lease liabilities 21. Bonds 21. Bonds
2018 2017 2018 2017 2018 2017 2018 20
AED m AED m AED m AED m AED m AED m AED m AED

-current Non-current Balance brought forward Balance brought forward 4,187 8,878 4,187 8,87
ds (Note 21) Bonds (Note 21) 4,821 3,561 4,821 3,561 Additions during the year Additions during the year 2,203 - 2,203
Overview Term loans (Note 22) 4,448 3,443
m loans (Note 22) 4,448 3,443 Repayments during the year Repayments during the year (610) (4,682) (610) (4,68
e liabilities
Emirates (Note 23) Lease liabilities (Note 23) 32,802 33,167 32,802 33,167 Currency translation differences
Currency translation differences - (9) -

dnata 42,071 40,171 42,071 40,171 Balance carried forward Balance carried forward 5,780 4,187 5,780 4,18
ent Current Less: Transaction costs (29) (2
Less: Transaction costs (29) (20)
Group
ds (Note 21) Bonds (Note 21) 930 606 930 606 5,751 4,16
5,751 4,167
Financial Term loans (Note 22) 528 1,514
m loans (Note 22)
Information
528 1,514 Bonds are repayable as follows:
Bonds are repayable as follows:
e liabilities (Note 23) Lease liabilities (Note 23) 7,572 8,707 7,572 8,707
Emirates
Within one year (Note 20) Within one year (Note 20) 930 606 930 60
overdraft
Financial (Note 33) Bank overdraft (Note 33) - 4 - 4 Between 2 and 5 years 3,261 2,42
Between 2 and 5 years 3,261 2,429
Commentary
9,030 10,831 9,030 10,831 After 5 years 1,560 1,13
After 5 years 1,560 1,132
dnata
dnata 51,101 51,002
Financial
Financial
51,101 51,002 Total over one year (Note 20)
Total over one year (Note 20) 4,821 3,561 4,821 3,56
Commentary
owings and lease
Commentary liabilitiesBorrowings and lease
are denominated liabilities are denominated in the
in the
wing currencies: following currencies: Bondsand
Bonds are fixed interest rate bonds areare
fixed interest rateinbonds
denominated USD. and are denominated in USD.
Emirates
Emirates
Consolidated
Consolidated US Dollar 47,599 47,283
Dollar
Financial
Financial
47,599 47,283 The fair value of the bonds is The
AEDfair5,740
valuemof(2017:
the bonds is AEDm)5,740
AED 4,244 m on
based (2017: AED 4,244 m) based on list
listed
Statements
Statements
Dirham UAE Dirham 3,502 3,719 3,502 3,719 prices
prices and falls into level 1 of the fairand falls
value into level 1 of the fair value hierarchy.
hierarchy.
dnata
Consolidated
effective rate perThe
interest
Financial effective
annum interest
on lease rate per
liabilities wasannum on lease
3.1% (2017: liabilities
2.8%), term was 3.1% (2017: 2.8%), term
Statements loans was 3.2% (2017: 3.1%) and bonds was 4.3% (2017: 4.5%).
s was 3.2% (2017: 3.1%) and bonds was 4.3% (2017: 4.5%).
Additional
Information

122 27 27
 THE EMIRATES GROUP
ANNUAL REPORT

2017-18

Term loans 22. Term loans 23. Lease liabilities 23. Lease liabilities
2018 2017 2018 2017
AED m AED m AED m AED m Finance leases Finance leases
nce brought forward Balance brought forward 5,031 2,965 5,031 2,965 2018 2017 2018 201
tions during the year Additions during the year 3,381 3,010 3,381 3,010 AED m AED m AED m AED
yments during the year Repayments during the year
Overview (3,371) (944) (3,371) (944) Balance brought forward Balance brought forward 41,874 38,317 41,874 38,31
nceEmirates
carried forward Balance carried forward 5,041 5,031 5,041 5,031 Additions Additions 5,008 7,981 5,008 7,98
Transaction costs Less: Transaction costs (65) (74) (65) (74) Repayments Repayments (6,508) (4,424) (6,508) (4,42
dnata
4,976 4,957 4,976 4,957 Balance carried forward Balance carried forward 40,374 41,874 40,374 41,87
Group
s are repayable as follows:Loans are repayable as follows:
Financial
hin one year (Note 20) Within one year (Note 20)
Information 528 1,514 528 1,514 Gross lease liabilities: Gross lease liabilities:
een 2 and 5 years Between 2 and 5 years 1,832 1,528 1,832 1,528 Within one year Within one year 8,793 9,906 8,793 9,90
Emirates
5 years
Financial After 5 years 2,616 1,915 2,616 1,915 Between 2 and 5 years Between 2 and 5 years 22,415 22,503 22,415 22,50
Commentary
Total over one year (Note 20)
l over one year (Note 20) 4,448 3,443 4,448 3,443 After 5 years After 5 years 15,236 15,642 15,236 15,64
dnata
dnata
s are denominated in theLoans
Financial
Financial
are denominated
following currencies: in the following currencies: 46,444 48,051 46,444 48,05
Commentary
Commentary
ollar US Dollar 4,686 4,540 4,686 4,540 Future interest Future interest (6,070) (6,177) (6,070) (6,17
Dirham
Emirates
Emirates UAE Dirham 290 417 290 417 Present
Present value of finance lease value of finance lease liabilities
liabilities 40,374 41,874 40,374 41,87
Consolidated
Consolidated
Financial
Financial The present
The present value of finance lease liabilitiesvalue
is of finance lease liabilities is
Statements
Statements
ractual repricing dates Contractual repricing
are set at three dates
to six are intervals.
month set at three
Termto loans
six month intervals. Term loans repayable as follows: repayable as follows:
unting amounting
dnatato AED 4,751 m (2017: to AED
AED 3,512 m) 4,751 m (2017:
are secured on AED 3,512 m) are secured on aircraft.
aircraft. Within one year (Note 20) Within one year (Note 20) 7,572 8,707 7,572 8,70
Consolidated
Financial Between 2 and 5 years Between 2 and 5 years 19,168 19,122 19,168 19,12
Statements
Theamounts
fair value of the term loans fair valuetoofAED
the 5,016
term loans amounts
m (2017: to AED
AED 4,947 m).5,016
The m (2017: AED 4,947 m). The
After 5 years After 5 years 13,634 14,045 13,634 14,04
value fair value isprojected
is determined by discounting
Additional determined cashbyflows
discounting projected
using the interest cash
rate flows using the interest rate
Information Total over one year (Note 20) 32,802
Total over one year (Note 20) 33,167 32,802 33,16
curve for the remainingyieldtermcurve for the remaining
to maturities term to
and currencies maturities
adjusted and currencies adjusted for credit
for credit
The present
The present value of finance lease liabilitiesvalue
is of finance lease liabilities is
spread.
ad. The fair value of the term The
loans fairinto
falls value of 2the
level of term loans
the fair falls
value into level 2 of the fair value hierarchy.
hierarchy.
denominated in the following denominated
currencies: in the following currencies:
US Dollar US Dollar 37,162 38,576 37,162 38,57
UAE Dirham UAE Dirham 3,212 3,298 3,212 3,29

Lease liabilities amounting to Lease liabilities

AED 38,978 amounting
m (2017: to AEDm)
AED 40,596 38,978 m (2017:
are secured onAED
the 40,596 m) are secured on t
related aircraft and aircraft engines.
related aircraft and aircraft engines.

28 28 123
 THE EMIRATES GROUP
ANNUAL REPORT

2017-18

23. Lease liabilities (continued)

ease liabilities (continued) 24. Provisions 24. Provisions
2018 2017 2018 201
The
air value of lease liabilities fair value
amounts to of
AEDlease liabilities
39,738 amounts
m (2017: to AEDm).
AED 41,302 39,738
The m (2017: AED 41,302 m). The AED m AED m AED m AED
fair value isprojected
value is determined by discounting determinedcashbyflows
discounting projected
using the interest cash
rate flows using the interest rate Non-current Non-current
curve for the remainingyieldtermcurve for the remaining
to maturities term to
and currencies maturities
adjusted and currencies adjusted for credit
for credit
Retirement benefit obligationsRetirement
(Note 25) benefit obligations (Note 25)
1,418 1,297 1,418 1,29
ad. The fair value of leasespread.
Overview
The
liabilities fairinto
falls value of 2lease
level liabilities
of the falls
fair value into level 2 of the fair value hierarchy.
hierarchy.
Provision (Note
Provision for aircraft return conditions for aircraft
26) return conditions (Note 26) 2,528
2,649 2,649 2,52
e lease Some
agreements provide
Emirates forlease agreements
variable provide to
lease payments forthe
variable
extentlease
that payments
the to the extent that the 4,067 3,825 4,067 3,82
interest
est portion is linked to market portion
interest is linked
rates, to market
normally interest rates, normally the LIBOR.
the LIBOR. Current Current
dnata
Provision (Note
Provision for aircraft return conditions for aircraft
26) return conditions687
(Note 26) 597 687 59
Group
687 597 687 59
Financial
rating leases
Information
Operating leases 4,754 4,422 4,754 4,42
2018 2017 2018 2017
Emirates
Financial AED m AED m AED m AED m
Commentary
Future
re minimum lease payments are minimum
as follows:lease payments are as follows:
dnata
dnata
aft fleet
Financial
Financial
Aircraft fleet 82,449 80,266 82,449 80,266
Commentary
Commentary
rs Others 2,995 2,504 2,995 2,504
Emirates
Emirates 85,444 82,770 85,444 82,770
Consolidated
Consolidated
Financial
Financial
Statements
Statements
in one year Within one year 11,845 10,913 11,845 10,913
dnata
eenConsolidated
2 and 5 years Between 2 and 5 years 39,962 37,508 39,962 37,508
Financial After 5 years 33,637 34,349
5 years
Statements
33,637 34,349
85,444 82,770 85,444 82,770
Additional
Information

The futureinclude
future minimum lease payments minimum
AEDlease
5,232payments
m (2017:include AED m)
AED 6,077 5,232 m (2017: AED 6,077 m)
ed to a company under related to a control.
common company under
Such common
payments arecontrol. Such payments are on normal
on normal
mercial terms. commercial terms.

ates is entitled to extend Emirates is entitled

certain aircraft to for
leases extend certain
a further aircraft
period of leases
one tofor
six a further period of one to six
yearsperiod.
s at the end of the initial lease at the end of the initial lease period.

e lease agreements provideSomeforlease agreements

variable provide to
lease payments forthe
variable
extentlease
that payments
the to the extent that the
interest
est portion is linked to market portion
interest is linked
rates, to market
normally interest rates, normally the LIBOR.
the LIBOR.

124
29 29
 THE EMIRATES GROUP
ANNUAL REPORT

2017-18

25. Retirement benefit obligations

Retirement benefit obligations (i) Funded scheme (i) Funded scheme

In accordance
cordance with the provisions of IAS 19,with the provisions
management of IAS out
has carried 19, management
an exercise has carried out an exercise Senior employees based in theSenior employees in
UAE participate based in thebenefit
a defined UAE participate
providentinscheme
a defined benefit provident schem
to its
ssess the present value of assess the present
defined value of its at
benefit obligations defined
31 Marchbenefit
2018 obligations
in at 31 March 2018 in to which Emirates contributestoa which Emirates
specified contributes
percentage a specified
of basic percentage
salary based of basic salary based upon th
upon the
ect of employees' endrespect of employees'
of service end of under
benefits payable servicerelevant
benefitslocal
payable under relevant local employee’s
employee’s grade and duration grade
of service. and duration
Amounts of service.
contributed Amounts
are invested in acontributed are invested in
lations regulations and
and contractual arrangements.
Overview
contractual
The assessmentarrangements. The assessment
assumed expected salary assumed expected salary trustee
trustee administered scheme and administered scheme
accumulate along andreturns
with accumulate
earnedalong
on with returns earned o
eases averaging 3.0% (2017:increases averaging
3.0%) and 3.0% rate
a discount (2017:
of 3.0%) and a 4.25%)
4.0% (2017: discount
perrate of 4.0% (2017: 4.25%) per investments.
investments. Contributions are made onContributions are made
a monthly basis on a monthly
irrespective of fund basis irrespective of fun
Emirates
um. The present values ofannum. The present
the defined benefit values of theatdefined
obligations benefit
31 March 2018obligations
were at 31 March 2018 were performance
performance and are not pooled, but are and are notidentifiable
separately pooled, but areattributable
and separately to
identifiable and attributable
puted using the actuarial computed
dnata assumptionsusing
set the
out actuarial
above. assumptions set out above. each participant.
each participant. The fund comprises a diverse The
mix fund comprises
of managed a diverse
funds mix of managed funds and investme
and investment
decisions
decisions are controlled directly by the are controlledemployees.
participating directly by the participating employees.
Group The liabilities recognised
iabilities recognised in the consolidated statementinofthe consolidated
financial positionstatement
are: of financial position are:
Financial
Information 2018 2017 2018 2017 Benefits receivable under theBenefits receivable
provident schemeunder the provident
are subject to vestingscheme
rules, are subject to vesting rules, whi
which
AED m AED m are dependent
are dependent upon a participating uponlength
employee's a participating
of service.employee's length
If at the time an of service. If at the time a
AED m AED m
Emirates
employee leaves employment,employee leaves employment,
the accumulated the accumulated
vested amount, vested amount, including investme
including investment
dedFinancial
scheme Funded scheme
Commentary returns,
returns, is less than the end of serviceisbenefits
less than thewould
that end ofhave
service
beenbenefits
payablethat would have been payable to th
to that
Present
ent value of defined benefit value of defined benefit obligations
obligations 2,581 2,316 2,581 2,316 employee under Emirates
relevant pays
local the
regulations,
dnata
dnata
employee under relevant local regulations, shortfall Emirates
amount pays the shortfall amou
Fair value of plan
Financial
Financial assets Less: Fair value of plan assets (2,577) (2,309) (2,577) (2,309) directly iftothe
directly to the employee. However, theaccumulated
employee. However, if the accumulated
vested amount exceeds the vested amount exceeds th
Commentary
Commentary
4 7 4 7 end ofhave
end of service benefits that would service
beenbenefits
payablethat would
to an have been
employee underpayable to an employee under releva
relevant
Emirates
Emirates
unded scheme Unfunded scheme local
local regulations, the employee regulations,
receives eitherthe employee
seventy five orreceives either seventy
one hundred percent five or one hundred perce
Consolidated
Consolidated
Present value of defined benefit obligations 1,414 1,290 of their
of their fund balance depending on fund
their balance
length ofdepending on theirassets
service. Vested length
of of
theservice. Vested assets of th
ent Financial
Financial
value of defined benefit obligations 1,414 1,290
Statements
Statements scheme orareitsnot available to Emirates or its creditors in any circumstances.
scheme are not available to Emirates creditors in any circumstances.
dnata
ilityConsolidated Liability recognised in the consolidated
recognised in the consolidated The AED
The liability of AED 4 m (2017: liability
7 m)of represents
AED 4 m (2017: AED 7that
the amount m) represents
will not bethe amount that will not b
Financial statement of financial position 1,418
ement of financial position 1,297 1,418 1,297
Statements settled from plan assets and is calculated as
settled from plan assets and is calculated as the excess of the present valuethe of
excess
the of the present value of th
defined
defined benefit obligation for benefit obligation
an individual employee foroveranthe
individual employee
fair value of the over the fair value of th
Additional
above The as
liability is presented above liability is provision
a non-current presentedwithin
as a non-current provision within the consolidated
the consolidated employee's plan assets at the end of the reporting period.
Information employee's plan assets at the end of the reporting period.
statement of financial position as Emirates expects to settle this liability over a long
ement of financial position as Emirates expects to settle this liability over a long
term period. The
The movement in the fair value ofmovement in theisfair
the plan assets value of the plan assets is as follows:
as follows:
period.
2018 2017 2018 201
AED m AED m AED m AED

Balance brought forward Balance brought forward 2,309 2,037 2,309 2,03
Contributions received Contributions received 300 302 300 30
Benefits paid Benefits paid (194) (153) (194) (15
Change in fair value Change in fair value 162 123 162 12
Balance carried forward Balance carried forward 2,577 2,309 2,577 2,30

30 30 125
 THE EMIRATES GROUP
ANNUAL REPORT

2017-18

Retirement benefit obligations

25. Retirement
(continued)
benefit obligations (continued) (iii) Defined contribution plans
(iii) Defined contribution plans

Emirates pays fixed contributions

Emirates
to certain
pays fixed
defined
contributions
contribution
to plans
certainand
defined
has no
contribution plans and has n
ributions received include the transfer received
Contributions of accumulated
include benefits fromofunfunded
the transfer accumulated benefits from unfunded legal or constructive obligation
legaltoorpay
constructive
further contributions
obligation to
to pay
settlefurther
the benefits
contributions to settle the benef
mes. Emirates expects toschemes.
contribute approximately
Emirates expects AED 302 m forapproximately
to contribute existing plan AED 302 m for existing plan relating to employees' servicerelating
in the current
to employees'
and priorservice
periods.
in the current and prior periods.
bers during the year ending 31 March
members 2019.
during the year ending 31 March 2019.
The total amount recognised in
Thethe
total
consolidated
amount recognised
income statement
in the consolidated
is as follows:
income statement is as follows:
arialOverview
gains and losses andActuarial
the expected
gains return on plan
and losses and assets are not return
the expected calculated
on plan assets are not calculated
n that investment decisions
Emirates
relating
given to plan assets
that investment are under
decisions the direct
relating control
to plan assetsofare under the direct control of
2018 2017 2018 201
cipating employees. participating employees.
dnata AED m AED m AED m AED
Unfunded
Group schemes (ii) Unfunded schemes Defined benefit plan Defined benefit plan
Funded scheme Funded scheme
Financial
of Information
service benefits for End
employees whobenefits
of service do not for
participate
employeesin the
whoprovident
do not participate in the provident Contributions expensed Contributions expensed 296 294 296 29
me or other defined contribution
scheme orplans
otherfollow relevant
defined local regulations,
contribution which
plans follow relevant local regulations, which Net change in the present value
Netofchange
definedinbenefit
the present value of defined benefit
Emirates
mainly based on periodsare
Financial of mainly
cumulative service
based and levels
on periods of employees’
of cumulative final
service and levels of employees’ final obligations over plan assets obligations over plan assets (3) (30) (3) (3
Commentary
salaries. The liability recognised in the
basic salaries. Theconsolidated statement
liability recognised of financial
in the consolidated statement of financial 293 264 293 26
iondnata
is the present valueposition
dnata of the defined benefit value
is the present obligation
of theatdefined
the endbenefit
of theobligation at the end of the Unfunded scheme Unfunded scheme
Financial
Financial
rting period.
Commentary
Commentary reporting period.
Current service cost Current service cost 172 206 172 20
movement
Emirates in the defined The
Emirates benefit obligation
movement is as
in the follows:benefit obligation is as follows:
defined Interest cost Interest cost 55 59 55 5
Consolidated
Consolidated
Financial
Financial 227 265 227 26
Statements
Statements 2018 2017 2018 2017
Defined contribution plan Defined contribution plan
AED m AED m AED m AED m
dnata
Contributions expensed Contributions expensed 212 212 212 21
nceConsolidated
brought forward Balance brought forward 1,290 1,427 1,290 1,427
Financial
ent Statements
service cost Current service cost 172 206 172 206
Recognised in the consolidated
Recognised
income statement
in the consolidated income
732 statement
741 732 74
est Additional
cost Interest cost 55 59 55 59
Information
easurement Remeasurement
hanges in experience / demographic
- changes assumptions (23) assumptions
in experience / demographic 13 (23) 13
- changes in financial assumptions 29
hanges in financial assumptions (324) 29 (324)
ments made during the year
Payments made during the year (109) (91) (109) (91)
nce carried forward Balance carried forward 1,414 1,290 1,414 1,290

ments made during the year include made

Payments transfer of accumulated
during benefits
the year include to Emirates’
transfer of accumulated benefits to Emirates’
ed scheme. funded scheme.

126
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 THE EMIRATES GROUP
ANNUAL REPORT

2017-18

25. Retirement benefit obligations (continued) 26. Provision

26. Provision for aircraft return conditionsfor aircraft return conditions
Retirement benefit obligations (continued)

The sensitivity of the unfunded scheme to changesisinset

the principal assumptions is set 2018 2017 2018 201
sensitivity of the unfunded scheme to changes in the principal assumptions
below: out below: AED m AED m AED m AED

mption Assumption Change Effect on Change Effect on Balance brought forward Balance brought forward 3,125 2,803 3,125 2,80
Overview unfunded unfunded Charge for the year 714 79
Charge for the year 714 797
scheme scheme
Emirates Unwinding of discount - net Unwinding of discount - net 159 156 159 15
AED m AED m
dnata
Utilised on return of aircraft &Utilised
aircrafton return of aircraft & aircraft
engines engines
(459) (475) (459) (47
+ 0.5% (80) + 0.5% (80)
ount rate Discount rate Unutilised amounts reversed Unutilised amounts reversed (203) (156) (203) (15
Group - 0.5% 89 - 0.5% 89
Balance carried forward Balance carried forward 3,336 3,125 3,336 3,12
Financial + 0.5% 92 + 0.5% 92
ctedInformation
salary increases Expected salary increases The provision is expected
The provision is expected to be used as follows: to be used as follows:
- 0.5% (83) - 0.5% (83)
Within one year (Note 24) Within one year (Note 24) 687 597 687 59
Emirates
above analysis The
sensitivity
Financial above
is based onsensitivity
a change analysis is based on
in an assumption a change
while holdingin all
an assumption while holding all Over one year (Note 24) Over one year (Note 24) 2,649 2,528 2,649 2,52
Commentary
other
r assumptions constant. In assumptions
practice, constant.
this is unlikely In practice,
to occur, this is unlikely
and changes in someto occur, and changes in some
e assumptions
dnata
dnata of the assumptions
may be correlated. may be
In calculating the correlated. In calculating
above sensitivity analysis,the above sensitivity analysis,
Financial
Financial 27. Deferred revenue 27. Deferred revenue
present value
Commentary
Commentary of the the
definedpresent
benefit value of the
obligation defined
has been benefit obligation
calculated using has been calculated using the
the
2018 2017 2018 201
projected
ected unit credit method at the endunit credit
of the method
reporting at the end of the reporting period.
period.
Emirates
Emirates AED m AED m AED m AED
Consolidated
Consolidated The weighted average duration of the unfunded scheme is 14 years (2017: 14 years).
weighted
Financialaverage duration of the unfunded scheme is 14 years (2017: 14 years). Balance brought forward 2,465 2,91
Financial Balance brought forward 2,465 2,912
Statements
Statements
Additions during the year Additions during the year 1,558 1,446 1,558 1,44
ughdnata Through
its defined benefit plans its defined
Emirates benefit
is exposed to aplans Emirates
number is exposed
of risks, the mostto a number of risks, the most
Consolidated significant of which are detailed below: Recognised during the year Recognised during the year (1,780) (1,893) (1,780) (1,89
ficant of which are detailed below:
Financial Balance carried forward 2,243 2,46
Statements Balance carried forward 2,243 2,465
hange in discount rate: a) Change inbenefit
Retirement discount rate: Retirement
obligations benefit
will increase dueobligations
to a will increase due to a
Deferred revenue is expected Deferred revenue as
to be recognised is expected to be recognised as
easeAdditional decrease
in market yields of high in corporate
quality market yields of high quality corporate bonds.
bonds.
Information follows: follows:

Within one year Within one year 1,180 1,486 1,180 1,48
xpected salary increases: b) Expected
The present salary
value increases: The present
of the defined benefit value of theis defined benefit obligation is
obligation
ulated by reference to thecalculated by reference
future salaries to the futureAs
of plan participants. salaries of plan
such, an participants. As such, an increase
increase Over one year Over one year 1,063 979 1,063 97
in the salary
e salary of the plan participants of the plan
will increase participants
the retirement will increase
benefit the retirement benefit obligations.
obligations.
Deferred revenue relates to Deferred revenue
the frequent flyer relates to theand
programme frequent flyer the
represents programme
fair and represents the f
value of outstanding Skywards miles. Revenue is
value of outstanding Skywards miles. Revenue is recognised when Emirates fulfils recognised when Emirates ful
its obligations
its obligations by supplying free by supplying
or discounted goods or free or discounted
services goods or services on the redempti
on the redemption
of the Skywards miles. of the Skywards miles.

Deferred
Deferred revenue is classified revenue and
within current is classified within
non-current currentbased
liabilities and non-current
on liabilities based o
expected redemption patterns.expected redemption patterns.

32 32 127
 THE EMIRATES GROUP
ANNUAL REPORT

2017-18

Deferred credits 28. Deferred credits 30. Trade and other payables
30. Trade and other payables
2018 2017 2018 2017 2018 2017 2018 201
AED m AED m AED m AED m AED m AED m AED m AED
nce brought forward Balance brought forward 2,480 1,229 2,480 1,229 Trade payables and accruals Trade payables and accruals 15,095 13,910 15,095 13,91
tions during the year Additions during the year 746 1,456 746 1,456 Passenger and cargo sales in advance
Passenger and cargo sales in advance
12,349 10,878 12,349 10,87
Overview
ognised during the year Recognised during the year (292) (205) (292) (205) Related parties (Note 37) Related parties (Note 37) 982 1,088 982 1,08
nceEmirates
carried forward Balance carried forward 2,934 2,480 2,934 2,480 Dividend payable Dividend payable 1,000 - 1,000 -
rreddnata Deferred
credits will be recognised credits will be recognised as follows:
as follows: 29,426 25,876 29,426 25,87
hin one year Within one year 313 253 313 253 Less: Payables over one year Less: Payables over one year (123) (683) (123) (68
Group
r one year Over one year 2,621 2,227 2,621 2,227 29,303 25,193 29,303 25,19
Financial
Information
Deferred income tax 29. Deferred income tax The carrying value of trade and
The other
carrying
payables
value of
over
trade
oneand
yearother
approximate
payablesto
over
their
one year approximate to the
Emirates
Financial fair value. fair value.
Commentary
Deferred
rred tax assets and liabilities tax assets
are offset whenand liabilities
there are offset
is a legally when there
enforceable right is a legally enforceable right
dnata
fsetdnata to offset
current tax assets against current
current tax tax assets and
liabilities against
whencurrent tax liabilities
the deferred taxes and when the deferred taxes 31. Guarantees 31. Guarantees
Financial
Financial
the same income taxrelate
e toCommentary
Commentary to the
authority. same
The income
offset tax authority.
amounts The offset amounts are as follows:
are as follows: 2018 2017 2018 201
Emirates
Emirates AED m AED m AED m AED
Consolidated
Consolidated
Performance bonds and letters
Performance
of credit provided
bonds and
by letters of credit provided by
Financial
Financial 2018 2017 2018 2017
Statements
Statements banks in the normal course ofbanks
business
in the normal course of business
464 383 464 38
AED m AED m AED m AED m
dnata
rredConsolidated
income tax asset Deferred income tax asset 11 10 11 10
Performance bonds and letters
Performance
of credit bonds
includeand
AEDletters
136 mof (2017:
credit AED
include
94 AED
m) 136 m (2017: AED 94 m
rredFinancial
income tax liability Deferred income tax liability (4) (5) (4) (5)
Statements provided by companies underprovided
commonbycontrol
companies
on normal
undercommercial
common control
terms. on normal commercial terms.
7 5 7 5
Additional
movements The movements
in deferred taxes in deferred taxes are as follows:
are as follows:
Information
nce brought forward Balance brought forward 5 (1) 5 (1)
consolidation settlementsTax consolidation settlements 2 6 2 6
nce carried forward Balance carried forward 7 5 7 5

128
33 33
 THE EMIRATES GROUP
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Commitments 32. Commitments 33. Short term bank deposits

33.
and
Short
cashterm
and bank
cash equivalents
deposits and cash and cash equivalents
2018 2017 2018 201
tal commitments Capital commitments AED m AED m AED m AED
2018 2017 2018 2017 Bank deposits Bank deposits 18,138 12,034 18,138 12,03
AED m AED m AED m AED m Cash and bank Cash and bank 2,282 3,634 2,282 3,63
Overview
orised and contracted: Authorised and contracted: Cash and bank balances Cash and bank balances 20,420 15,668 20,420 15,66
aft Emirates Aircraft 194,020 210,064 194,020 210,064 Less: Short term bank depositsLess:
- over 3 months
Short (14,745)
term bank deposits - over 3 months (6,706) (14,745) (6,70
-aircraft
dnata
Non-aircraft 1,076 1,663 1,076 1,663 Cash and cash equivalents asCash
per and
the consolidated
cash equivalents as per the consolidated
ventures Joint ventures 14 38 14 38 statement of financial position
statement of financial position 5,675 8,962 5,675 8,96
Group
195,110 211,765 195,110 211,765 Bank overdraft (Note 20) Bank overdraft (Note 20) - (4) - (
Financial Cash and cash equivalents asCash
per and
the consolidated
cash equivalents as per the consolidated
orised but not
Information Authorised but not contracted:
contracted:
statement of cash flows statement of cash flows 5,675 8,958 5,675 8,95
aft Aircraft 48,693 - 48,693 -
Emirates
-aircraft
Financial Non-aircraft 2,228 2,827 2,228 2,827
Commentary Cash and bank balances earned
Cashanand
effective interest rate
bank balances of 3.0%
earned (2017: 2.6%)
an effective perrate of 3.0% (2017: 2.6%) p
interest
ventures Joint ventures 11 17 11 17
dnata
dnata annum. annum.
Financial
Financial 50,932 2,844 50,932 2,844
Commentary
Commentary
246,042 214,609 246,042 214,609 Cash and bank balances include
Cash AED 12,348balances
and bank m (2017: AED 10,014
include m) held
AED 12,348 with AED 10,014 m) held wi
m (2017:
Emirates
Emirates companies under common control.
companies under common control.
Consolidated
Consolidated
mitments
Financial have
Financial Commitments
been entered into for have been entered
the purchase into for the
of aircraft purchase
delivery as of aircraft for delivery as
Statements
Statements
ws: follows: 34. Cash outflow on property,
34.plant
Cash and equipment
outflow on property, plant and equipment
dnata
ncial year Financial year Aircraft Aircraft
Consolidated
-19Financial 2018-19 16 16 For the purposes of the consolidated statement
For the purposes of cash
of the flows, cash
consolidated outflow of
statement oncash flows, cash outflow o
Statements
nd 2018-19: Beyond 2018-19: property, plant and equipment is analysed
property, asand
plant follows:
equipment is analysed as follows:
Additional
orised and contracted
Information Authorised and contracted 186 186 2018 2017 2018 201
orised but not contractedAuthorised but not contracted 60 60 AED m AED m AED m AED
Additions to property, plant and equipment
Additions (Note 11)
to property, 8,287
plant and equipment 12,363
(Note 11) 8,287 12,36
e event that delivery of In the event
certain that
aircraft aredelivery of certain
not taken, aircraft
penalties are not by
are payable taken, penalties are payable by
Less: Assets acquired under finance leasesacquired
Less: Assets (Note 23)under finance(5,008) (7,981)
leases (Note 23) (5,008) (7,98
ates to the extent of AED Emirates to the extent
1,416 m (2017: of AED
AED 1,858 m). 1,416 m (2017: AED 1,858 m).
3,279 4,382 3,279 4,38

rational commitments Operational commitments

2018 2017 2018 2017
AED m AED m AED m AED m
s and marketing Sales and marketing 4,249 2,036 4,249 2,036

34 34 129
 THE EMIRATES GROUP
ANNUAL REPORT

2017-18
Derivative financial instruments
35. Derivative financial instruments The notional principal amounts outstanding include AED 2,012 m (2017: AED 2,293 m)
cription 2018 2017 against derivatives entered with
Thecompanies under common
notional principal control.
amounts outstanding include AED 2,012 m (2017: AED 2,293
Term
Description AED m Term 2018 AED m 2017 against derivatives entered with companies under common control.
Term AED m Term AED m The full fair value of the derivative instrument is classified as non-current if the
h flow hedge
remaining maturity of the hedged item
The full fairis more
value than 12 derivative
of the months as instrument
at the end is
of classified
the as non-current if
-current assets Cash flow hedge
reporting period. remaining maturity of the hedged item is more than 12 months as at the end of
est Overview
rate swaps Non-current
2019-2028assets 60 2018-2028 38
reporting period.
Emirates Interest rate swaps 60 2019-2028 3860 2018-2028 38 The maximum exposure to credit risk at the reporting date is the fair value of the
entdnata
assets 60 38 derivative assets in the consolidated statement
The maximum of financial
exposure position.
to credit risk at the reporting date is the fair value of
ency forwards Current assets 9 8 derivative assets in the consolidated statement of financial position.
Group
Currency forwards 9 8 9 8
Financial
h flow hedge
Information 9 8
-current liabilities Cash flow hedge
Emirates
est Financial
rate swaps Non-current
2019-2023liabilities (26) 2018-2023 (192)
Commentary
Interest rate swaps (26) 2019-2023 (192)(26) 2018-2023 (192)
dnata
dnata
entFinancial
liabilities
Financial (26) (192)
Commentary
Commentary
est rate swaps Current liabilities (35) (2)
encyEmirates
Emirates
forwards Interest rate swaps - (1)(35) (2)
Consolidated
Consolidated
Financial
Financial Currency forwards (35) (3) - (1)
Statements
Statements
(35) (3)
dnata
notional principal amounts outstanding are:
Consolidated
Financial
Statements The notional principal amounts outstanding
2018 are: 2017
AED m AED m 2018 2017
Additional
est Information
rate contracts 5,432 6,626 AED m AED m
ency contracts Interest rate contracts 929 868 5,432 6,626
Currency contracts 929 868

35
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THE EMIRATES GROUP
ANNUAL REPORT

2017-18

36. Classification of financial instruments

The accounting policies for financial instruments have been applied to the line items below:

Financial
Derivative liabilities at
Overview
Loans and financial amortised
Emirates Description receivables instruments cost Total
dnata AED m AED m AED m AED m

Group
2018
Assets
Financial
Information Loans and other receivables (excluding prepayments) 72 - - 72

Emirates
Derivative financial instruments - 69 - 69
Financial Trade and other receivables (excluding prepayments and advance lease rentals) 7,787 - - 7,787
Commentary
Short term bank deposits 14,745 - - 14,745
dnata
dnata
Financial
Financial Cash and cash equivalents 5,675 - - 5,675
Commentary
Commentary
Total 28,279 69 - 28,348
Emirates
Emirates
Consolidated
Consolidated
Financial
Financial Liabilities
Statements
Statements
Borrowings and lease liabilities - - 51,101 51,101
dnata Provision for aircraft return conditions - - 3,336 3,336
Consolidated
Financial Trade and other payables (excluding passenger and cargo sales in advance) - - 17,077 17,077
Statements
Derivative financial instruments - 61 - 61
Additional
Information Total - 61 71,514 71,575

36

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THE EMIRATES GROUP
ANNUAL REPORT

2017-18

36. Classification of financial instruments (continued)

Financial
Derivative liabilities at
Loans and financial amortised
Overview
Description receivables instruments cost Total
Emirates AED m AED m AED m AED m

dnata 2017
Assets
Group
Loans and other receivables (excluding prepayments) 104 - - 104
Financial
Information Derivative financial instruments - 46 - 46
Trade and other receivables (excluding prepayments and advance lease rentals) 6,828 - - 6,828
Emirates
Financial Short term bank deposits 6,706 - - 6,706
Commentary
Cash and cash equivalents 8,962 - - 8,962
dnata
dnata Total 22,600 46 - 22,646
Financial
Financial
Commentary
Commentary

Emirates
Emirates Liabilities
Consolidated
Consolidated
Financial
Financial Borrowings and lease liabilities - - 51,002 51,002
Statements
Statements
Provision for aircraft return conditions - - 3,125 3,125
dnata Trade and other payables (excluding passenger and cargo sales in advance) - - 14,998 14,998
Consolidated
Financial Derivative financial instruments - 195 - 195
Statements
Total - 195 69,125 69,320
Additional
Information

37

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 THE EMIRATES GROUP
ANNUAL REPORT

2017-18
Related party transactions and balances
37. Related party transactions and balances 2018 2017
ates transacts with associates, joint ventures and companies controlled by
AED m AED m 2018 20
ates and its parent withinEmirates
the scopetransacts with business
of its ordinary associates, joint ventures and companies controlled by
activities.
Emirates and its parent within the scope of its ordinary business activities. AED m AED
Other transactions:
ates and dnata share central corporate functions such as information technology, (i) Finance income Other transactions:
ties, human resources, Emirates
finance, and dnata cash
treasury, share management,
central corporate functions
legal such as information technology,
and other (i) Finance income
Companies under common control 214 157
Overview
tions. facilities,
Where such functions humantheresources,
are shared, costs are finance,
allocatedtreasury,
between cash management, legal and other
Emirates Companies under common control 214 1
Joint ventures 2 2
functions. Where such functions are shared, the costs are allocated between Emirates
dnata based on activity levels.
Emirates Joint ventures 216 159 2
and dnata based on activity levels.
dnata (ii) Compensation to key management personnel 216 1
er than these shared service arrangements, the following transactions have taken
(ii) Compensation
Salaries and short term employee benefits to key management156personnel 104
e onGroup Other than these shared service arrangements, the following transactions have taken
an arm's length basis.
place on an arm's length basis. Post-employment benefits Salaries and short term employee benefits
14 15 156 1
Financial 2018 2017
Information 2018 2017 Termination benefits Post-employment benefits 1 1 14
AED m AED m
AED m AED m Termination benefits 171 120 1
dingEmirates
transactions:
Financial 171 1
ale Commentary
of goods Trading transactions:
and services
(i) Sale
of goods - Companies under of goods
common and services
control 309 276 Emirates also uses a number of public utilities provided by Government controlled
dnata
dnata
Emirates
entities for its operations in Dubai, also these
where uses aentities
number areofthe
public
sole utilities
providers provided
of the by Government contro
venturesSale of goods - Companies under common
37 control 309 276
Financial
Financial
ofgoods
Commentary
Commentary- Joint 24
entities
relevant services. This includes the for its operations
supply in Dubai,
of electricity, water where these services.
and airport entities are the sole providers of
of goods - Associates Sale of goods - Joint ventures 64 44 37 24
Emirates
Emirates
Sale of goods - Associates 64 44 Transactions falling in these expense categories are individually insignificant and were water and airport servi
relevant services. This includes the supply of electricity,
icesConsolidated
rendered - Companies
Consolidated under common control 490 426 Transactions falling in these expense categories are individually insignificant and w
Financial
Financial carried out on an arm's length basis.
icesStatements Services
rendered - Joint ventures rendered - Companies under common
14 control15 490 426
Statements carried out on an arm's length basis.
uent Services rendered
flyer miles sales - Companies - Joint ventures
under common 14 15
dnata
rol Consolidated Frequent flyer miles sales - Companies under
304 common
300
Financial
control 304 300
Statements 1,218 1,085
Purchase of goods and services 1,218 1,085
Additional
Information (ii) under
hase of goods - Companies Purchase of goods
common and services 5,595
control 4,768
Purchase
hase of goods - Associates of goods - Companies under common
243 control
241 5,595 4,768

ices received - Companies Purchase of goodscontrol

under common - Associates 3,314 3,132 243 241
Services
ices received - Joint ventures received - Companies under common
6 control 15 3,314 3,132
Services received - Joint ventures
hase of goods - Joint ventures 7 - 6 15
Purchase of goods - Joint ventures 9,165 8,156 7 -
9,165 8,156

38
38 133
 THE EMIRATES GROUP
ANNUAL REPORT

2017-18

Related party transactions and balances (continued)

37. Related party transactions and balances (continued) Receivables from and loans to companies under common control relate to
2018 2017
2018 2017 government entities, which Receivables
are unrated. from and loans
Management is ofto the
companies under
opinion that the common control relate
AED m AED m
AED m AED m amounts are fully recoverable.government entities, which are unrated. Management is of the opinion that
end balances amounts are fully recoverable.
Year end balances 2018 2017
eceivables - sale of goods and services
(i) Receivables - sale of goods and services 2018 20
ciates 10 8 AED m AED m
Overview Associates 10 8 AED m AED
ventures 31 17 (iv) Loans and advances to key management personnel
Emirates Joint ventures 31 17 (iv) Loans and advances to key management personnel
panies under common control 99 80 Balance brought forward 6 8
Companies under common control 99 80 Balance brought forward 6
dnata
eivable within one year 140 105 Additions during the year 7 5
Receivable within one year 140 105 Additions during the year 7
Group Repayments during the year (7) (7)
Repayments during the year (7)
Receivables Balance carried forward 6 6
Financial - other transactions
(ii) Receivables - other transactions Balance carried forward 6
Information
panies under common control 74 75 Receivable within one year 3 3
Companies under common control 74 75 Receivable within one year 3
eivable within one year
Emirates 74 75 Receivable over one year (Note 15) 3 3
Financial Receivable within one year 74 75 Receivable over one year (Note 15) 3
Commentary

amounts outstanding at year end are unsecured and will be settled in cash. No
dnata
dnata
airment charge has been The
Financial
Financial
amountsduring
recognised outstanding
the yearatinyear end of
respect areamounts
unsecured and will be settled in cash. No
owed 2018 2017
Commentary
Commentary impairment charge has been recognised during the year in respect of amounts owed 2018 20
elated parties. AED m AED m
Emirates
Emirates by related parties. AED m AED
(v) Payables - purchase of goods and services (Note 30)
Consolidated
Consolidated
(v) Payables - purchase of goods and services (Note 30)
Financial
Financial 2018 2017 Associates 6 3
Statements
Statements
2018 2017 Associates 6
AED m AED m Companies under common control 958 1,064
dnata AED m AED m Companies under common control 958 1,0
Loans receivable
Consolidated 964 1,067
Financial (iii) Loans receivable 964 1,0
ventures
Statements 9 13 (vi) Other payables (Note 30)
Joint ventures 9 13 (vi) Other payables (Note 30)
9 13 Companies under common control 18 21
Additional
9 13 Companies under common control 18
Information
ement in the loans were as follows: 18 21
Movement in the loans were as follows: 18
nce brought forward 13 26
Balance brought forward 13 26
ayments during the year (4) (13)
Repayments during the year (4) (13)
nce carried forward 9 13
Balance carried forward 9 13
eivable within one year 4 5
Receivable within one year 4 5
eivable over one year (Note 15) 5 8
Receivable over one year (Note 15) 5 8

39
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 THE EMIRATES GROUP
ANNUAL REPORT

2017-18

Financial risk management

38. Financial risk management Emirates manages limits and controls
Emirates concentrations
manages of controls
limits and risk wherever they are of risk wherever they
concentrations
identified. In the normal course of business,
identified. In the Emirates places of
normal course significant
business,deposits
Emirateswith
places significant deposits
ncial risk factors Financial risk factors high credit quality banks high
and financial institutions.
credit quality banks Transactions
and financialwith derivativeTransactions with deriva
institutions.
counterparties are similarly limited to high credit
counterparties quality limited
are similarly financialtoinstitutions.
high credit Exposure
quality financial institutions. Expo
ates is exposed to a variety of financial
Emirates risks which
is exposed involve
to a variety of the analysis,
financial risksevaluation,
which involve the analysis, evaluation, to credit risk is also managed
tothrough regular
credit risk analysis
is also managedof the abilityregular
through of counterparties
analysis of the ability of counterpa
ptance and managementacceptance
of some degree of risk or combination
and management of risks.
of some degree of Emirates'
risk or combination of risks. Emirates' and potential counterpartiesand
to meet theircounterparties
potential obligations and
to by changing
meet their limitsand by changing their li
their obligations
Overview
is, therefore, to achieveaim
an is,appropriate
therefore, balance between
to achieve risk and return
an appropriate balanceand
between risk and return and where appropriate. Approximately
where 92% (2017: 86%)
appropriate. of cash and 92%
Approximately bank(2017:
balances areofheld
86%) cash and bank balances are
mise potential adverse effects
Emirates on Emirates'
minimise potentialfinancial
adverse performance.
effects on Emirates' financial performance. with financial institutions based in financial
with the UAE.institutions based in the UAE.

ates' risk management procedures

dnata are management
Emirates' risk designed to identify and analyse
procedures these to
are designed risks,
identify and analyse these risks, The sale of passenger and
The cargo
sale of
transportation
passenger and
is largely
cargo achieved
transportation
through
is largely achieved thro
et appropriate
Group
risk limits to
and
setcontrols, and risk
appropriate to monitor thecontrols,
limits and risks andand
adherence to the risks and adherence to
to monitor International Air Transport Association
International
(IATA)
Air Transport
approved Association
sales agents(IATA)
and online
approved
sales.
sales agents and online s
s by means of reliable and up-to-date
limits by meansinformation. Emirates
of reliable and regularly
up-to-date reviews itsEmirates regularly reviews its
information. All IATA agents have to meetAll
a minimum
IATA agents
financial
have to
criteria
meet applicable
a minimumtofinancial
their country
criteria
ofapplicable to their countr
Financial
management
Information
proceduresrisk
andmanagement
systems to reflect changes
procedures andinsystems
markets,toproducts and
reflect changes in markets, products and operation to remain accredited.
operation
Adherence
to remain
to theaccredited.
financial criteria
Adherence
is monitored
to the financial
on an criteria is monitored o
rging best practice. Emirates uses derivative
emerging financial
best practice. instruments
Emirates to hedge
uses derivative certaininstruments to hedge certain
financial ongoing basis by IATA through
ongoing
their basis
Agency
by Programme.
IATA throughThe
their
credit
Agency
risk Programme.
associated The credit risk associ
Emirates
exposures.
Financial
risk exposures. with such sales agents and the
with
related
such balances
sales agents
within
andtrade
the related
receivables
balances
is therefore
within trade
low receivables is therefore
Commentary
and further reduced by their diverse
and further
base.reduced by their diverse base.
k management programme is carried
A risk out under
management guidelines
programme that areout
is carried approved by a
under guidelines that are approved by a
ringdnata
dnata
group comprising senior
Financial
Financial
management.
steering Identification,
group comprising senior evaluation
management. andIdentification,
hedging evaluation and hedging Significant balances in otherSignificant
receivablesbalances
are heldinwith companies
other given
receivables are aheld
highwith
credit
companies given a high cr
ncialCommentary
risks is done in financial
Commentary close cooperation with inthe
risks is done operating
close units. with
cooperation Seniorthe operating units. Senior rating by leading internationalrating
ratingbyagencies.
leading international rating agencies.
agement
Emirates
Emirates
is also responsible for the review
management is alsoofresponsible
risk management and theofcontrol
for the review risk management and the control
ronment. The various financial
Consolidated
Consolidated risk elements
environment. are discussed
The various financialbelow:
risk elements are discussed below: The table below presents an analysis
The tableofbelow
short presents
term bankandeposits
analysis and bankterm
of short balances
bankby
deposits and bank balance
Financial
Financial
Statements
Statements rating agency designation atrating
the end of the
agency reporting at
designation period based
the end on Standard
of the reporting &period based on Standar
redit risk (i) Credit risk Poor's ratings or its equivalent for Emirates'
Poor's main
ratings or banking relationships:
its equivalent for Emirates' main banking relationships:
dnata
Consolidated
atesFinancial
is exposed
Statements
to credit risk, which
Emirates is the risk
is exposed that arisk,
to credit counterparty will risk
which is the cause
thata a counterparty will cause a 2018 2017 2018 2
ncial loss to Emirates byfinancial
failing to discharge
loss an obligation.
to Emirates Financial
by failing to assets
discharge an that
obligation. Financial assets that AED m AED m AED m AE
Additional
ntially subject Emirates to
Information
credit risksubject
potentially consistEmirates
principally of deposits
to credit with banks
risk consist and of deposits with banks and
principally AA- to AA+ AA- to AA+ 378 315 378
r financial institutions, derivative counterparties
other financial as well
institutions, as receivables
derivative from agents
counterparties as well as receivables from agents
A- to A+ A- to A+ 16,849 12,578 16,849 12,
ng commercial air transportation. Emirates uses
selling commercial external ratingsEmirates
air transportation. such as uses
Standard & ratings such as Standard &
external
BBB+ BBB+ 2,584 1,696 2,584 1,
r's and Moody's or their Poor's
equivalent
and in order to
Moody's ormeasure and monitor
their equivalent its credit
in order risk and monitor its credit risk
to measure
osures to financial institutions. In thetoabsence
exposures financialofinstitutions.
independent In ratings, creditofquality
the absence independent ratings, credit quality Lower than BBB+ Lower than BBB+ 11 56 11
sessed based on the counterparty's financial
is assessed based on position, past experience
the counterparty's andposition,
financial other past experience and other Unrated Unrated 517 694 517
ors. factors.

40 40 135
 THE EMIRATES GROUP
ANNUAL REPORT

2017-18

Financial risk management

38. (continued)
Financial risk management (continued) Interest rate risk Interest rate risk

Market risk (ii) Market risk Emirates is exposed to the effects

Emirates
of fluctuations
is exposedintothe
theprevailing
effects of levels
fluctuations
of interest
in the
rates
prevailing levels of interest r
on borrowings and investments.
on borrowings
Exposure arises
and investments.
from interestExposure
rate fluctuations
arises from
in the
interest rate fluctuations in
ates is exposed to market
Emirates
risk, which
is exposed
is the risk
to market
that therisk,
fairwhich
value isorthe
future
risk cash
that the fair value or future cash
international financial markets
international
with respect
financial
to interest
markets
costwith
on respect
its long toterm
interest
debt cost on its long term
s of a financial instrument
flows
willof fluctuate
a financial
because
instrument
of changes
will fluctuate
in market
because
prices.of changes in market prices.
obligations, operating lease rentals
obligations,
and interest
operating
income
leaseon
rentals
its cash
andsurpluses.
interest income
The keyon its cash surpluses. The
ket risk comprises three types
Market
of risk
risk comprises
- jet fuel price
threerisk,
types
currency
of risk risk
- jetand
fuelinterest
price risk, currency risk and interest
Overview reference rates based on which
reference
interestrates
costsbased
are determined
on which interest
are LIBOR
costs
forare
USdetermined
dollar, are LIBOR for US do
risk. rate risk.
EIBOR for UAE Dirham and EURIBOR
EIBOR for
forUAE
Euro.Dirham
Summarised
and EURIBOR
quantitative
for Euro.
dataSummarised
is available quantitative data is avail
Emirates
in Note 20 for interest cost exposures.
in Note 20 for interest cost exposures.
uel price risk Jet fuel price risk
dnata
ates is exposed to volatility
Emirates
in the isprice
exposed
of jettofuel
volatility
and closely
in themonitors
price of jet
thefuel
actual
and closely monitors the actual Borrowings taken at variable Borrowings
rates exposetaken
Emirates
at variable
to cashrates
flow expose
interestEmirates
rate risk to
while
cash flow interest rate risk w
Group
against the forecast cost.cost
To against
managethe
theforecast
price risk,
cost.
Emirates
To manage
considers
the price
the use
risk,ofEmirates considers the use of borrowings issued at fixed rates
borrowings
expose Emirates
issued attofixed
fair value
rates interest
expose Emirates
rate risk. to
Emirates
fair value interest rate risk. Emir
modity futures,
Financial options and
commodity
swaps tofutures,
achieveoptions
a level of
andcontrol
swapsover
to achieve
higher ajetlevel
fuelof control over higher jet fuel targets a balanced portfolio
targets
approach,
a balanced
whilst nevertheless
portfolio approach,
taking advantage
whilst nevertheless
of taking advantage
Information
s so that profitability is not
costs
adversely
so thataffected.
profitability is not adversely affected. opportune market movements
opportune
using appropriate
market movements
hedging solutions
using appropriate
including interest
hedging solutions including inte
Emirates rate swaps. Variable rate debt
rateand
swaps.
cashVariable
surpluses
rate
aredebt
mainly
anddenominated
cash surpluses
in are
UAE mainly denominated in
Financial
ency risk Currency risk
Commentary
Dirham and US Dollar. Dirham and US Dollar.
ates is exposed to the Emirates
effects ofisfluctuation
exposed toin the
the effects
prevailing
of fluctuation
foreign currency
in the prevailing foreign currency
dnata
dnata Sensitivity analysis of market
Sensitivity
risk analysis of market risk
ange rates on its financial
Financial
Financial exchange
position
ratesand
on cash
its financial
flows. Exposure
position arises
and cash
due flows.
to Exposure arises due to
Commentary
Commentary The following sensitivity analysis,
The following
relating tosensitivity
existing financial
analysis, instruments,
relating to existing
shows how
financial instruments, shows
ange rate fluctuations between
exchange
therate
UAEfluctuations
Dirham andbetween
other currencies
the UAE Dirham
generated
and other currencies generated
Emirates'
Emirates revenue earning
Emirates from activities.
Emirates' Long
revenue
termearning
debt obligations
activities. Long
are mainly
term debt obligations are mainly profit and equity would change
profit
if the
and market
equity risk
wouldvariables
changehad
if the
been
market
different
risk variables
at the had been different at
Consolidated
Consolidated end of the reporting periodend
withof all
theother
reporting
variables
period
heldwith
constant
all other
and variables
has beenheld constant and has b
ominated
Financial
Financial
in UAE Dirhamdenominated
or in US Dollar
in UAE
to which
Dirhamthe
or UAE
in US
Dirham
Dollaristopegged.
which the UAE Dirham is pegged.
tionally, some operating Additionally,
Statements
Statements lease liabilities
some
are operating
denominated
leaseinliabilities
Euro, Pound
are denominated
Sterling in Euro, Pound Sterling computed on the basis of assumptions
computed onand
theindices
basis of
used
assumptions
and considered
and indices
by other
used and considered by o
Japanese Yen to provide
and aJapanese
natural hedge
Yen toagainst
providerevenue
a natural
inflows
hedge
in against
these revenue inflows in these market participants. market participants.
dnata
encies. Senior management
Consolidated currencies.
monitorsSenior
currency
management
positions on
monitors
a regular
currency
basis. positions on a regular basis. 2018 2017 2018 2017
Financial Effect on Effect on EffectEffect
on Effect
on Effect
on on Effect on Effec
Statements
ates is in a net payer position
Emirates
with
is respect
in a net to
payer
the US
position
Dollarwith
andrespect
in a nettosurplus
the US Dollar and in a net surplus profit equity profitprofitequity
equity profit eq
tionAdditional
for other currencies.position
Currencyforsurpluses
other currencies.
are converted
Currency
to US
surpluses
Dollar and
are UAE
converted to US Dollar and UAE AED m AED m AED m
AED mAED m
AED m AED m AE
Information
am funds. Currency risks Dirham
arise mainly
funds.from
Currency
Emirates'
risksrevenue
arise mainly
earning
from
activities
Emirates'in revenue earning activities in Interest cost Interest cost
, Pound Sterling, Australian
Euro,
Dollar,
PoundIndian
Sterling,
Rupee,
Australian
ChineseDollar,
Yuan, Swiss
IndianFranc,
Rupee,South
Chinese Yuan, Swiss Franc, South - 25 basis points - 25 basis points
an Rand and Japanese Yen.
African
Currency
Randrisks
and are
Japanese
hedgedYen.
using
Currency
forwards
risksand
areoptions,
hedged using forwards and options, UAE Dirham UAE Dirham 5 5 6 5 6 5 6
ppropriate, as well as by as
wayappropriate,
of a naturalashedge
well as
between
by way foreign
of a natural
currency
hedge
inflows
between foreign currency inflows US Dollar US Dollar 71 40 70 71 26 40 70
outflows. and outflows. 76 45 76 76 32 45 76
+ 25 basis points + 25 basis points
ates is also subject to the
Emirates
risk that
is countries
also subject
in which
to the itrisk
maythat
earn
countries
revenuesin may
which it may earn revenues may
UAE Dirham UAE Dirham (5) (5) (6) (5) (6) (5) (6)
ose restrictions or prohibition
imposeonrestrictions
the export or
of prohibition
those revenues.
on the
Emirates
export seeks
of those
to revenues. Emirates seeks to
US Dollar US Dollar (71) (40) (70) (71) (26) (40) (70)
mise this risk by repatriating
minimise
surplus
this
funds
risk to
by the
repatriating
UAE on asurplus
monthly
funds
basis.
toCash
the UAE
and on a monthly basis. Cash and
equivalents for the current
cashyear
equivalents
include for
AEDthe
182current
m (2017:
yearAED
include
230 AED
m) held
182 inm (2017: AED 230 m) held in (76) (45) (76) (76) (32) (45) (76)
ntries where exchange controls
countries
and where
other restrictions
exchange controls
apply. and other restrictions apply.

136 41 41
 THE EMIRATES GROUP
ANNUAL REPORT

2017-18

Financial risk management

38. (continued)
Financial risk management (continued) (iii) Liquidity risk (iii) Liquidity risk
2018 2017 2018 2017
Liquidity
Liquidity risk is the risk that riskis isunable
Emirates the risk
to that
meetEmirates is unable
its payment to meet its payment obligat
obligations
Effect on Effect on EffectEffect on Effect
on Effect on on Effect on Effect on
associated
associated with its financial liabilities with
when its fall
they financial liabilities
due and whenfunds
to replace they when
fall due and to replace funds when
they
profit equity profitprofitequity
equity profit equity
are withdrawn. are withdrawn.
AED m AED m AED mAED m
AED m AED m AED m AED m
Emirates'
Emirates' liquidity management processliquidity management
as monitored process
by senior as monitored
management, by senior management, inclu
includes
est Overview
income Interest income the following: the following:
basis points - 25 basis points (13) - (5) (13) - - (5) -
Emirates
  Day
Day to day funding, managed by to
monitoring
day funding,
future
managed
cash flows
by monitoring
to ensure that
future cash flows to ensure th
basis points + 25 basis points 13 - 5 13 - - 5 -
dnata requirements can be met. requirements
This includes canreplenishment
be met. Thisof funds
includes
as replenishment
they of funds as th
mature. mature.
ency - Pound Sterling Currency - Pound Sterling
Group   Maintaining
Maintaining rolling forecasts of Emirates’rolling
liquidity
forecasts
position
of on
Emirates’
the basis
liquidity
of position on the basis
% + 1% 1 (1) 1 1 - (1) 1 - expected cash flows. expected cash flows.
Financial
Information - 1% (1) 1 (1) (1) - 1 (1) -   andMonitoring
Monitoring liquidity ratios net currentliquidity
assets against
ratios and
internal
net current
standards.
assets against internal standards.
 Maintaining debt financing plans.
Maintaining debt financing plans.
Emirates
ency - Euro Currency - Euro  Maintaining diversified creditMaintaining
lines including
diversifiedstand-by
credit lines
credit including
facility stand-by credit facil
Financial
% Commentary + 1% 1 (1) 3 1 - (1) 3 -
Sourcesreviewed
Sources of liquidity are regularly of liquidity are regularly
by senior reviewed
management to by senior amanagement to mainta
maintain
dnata
dnata - 1% (1) 1 (3) (1) - 1 (3) -
Financial
Financial diversification by geography, diversification by geography,
provider, product and term. provider, product and term.
Commentary
Commentary
ency - Australian Dollar Currency - Australian Dollar
% Emirates
Emirates + 1% 1 (1) 1 1 (1) (1) 1 (1)
Consolidated
Consolidated
Financial
Financial - 1% (1) 1 (1) (1) 1 1 (1) 1
Statements
Statements

ency - Chinese Yuan

dnata
Currency - Chinese Yuan
Consolidated
% + 1% 2 2 - 2 - 2 - -
Financial
Statements - 1% (2) (2) - (2) - (2) - -
Additional
Information

42 42 137
 THE EMIRATES GROUP
ANNUAL REPORT

2017-18

Financial risk management

38. (continued)
Financial risk management (continued) 39. Acquisitions 39. Acquisitions

Summarised
marised below in the table below profile
is the maturity in the of
table is the liabilities
financial maturity and
profile of financial liabilities and net-
net- In May 2017, Emirates acquired
In May
63% 2017,
of theEmirates
businessacquired
of Brand63%
2 Consumer
of the business
Co (Pty)ofLtd.
Brand 2 Consumer Co (Pty)
settled derivative
ed derivative financial liabilities based on financial liabilities
the remaining basedat on
period thethe
endremaining
of period at the end of (South Africa) for a purchase(South
consideration
Africa) for
of aAED
purchase
5 m and
consideration
90% of Seyvine
of AED
Limited
5 m and 90% of Seyvine Lim
reportingmaturity
rting period to the contractual period to theThe
date. contractual
amountsmaturity
discloseddate.
are The
the amounts disclosed are the (Seychelles) for a purchase (Seychelles)
consideration
forofa AED
purchase
1 m consideration
through its wholly
of AEDowned
1 m through its wholly ow
ractual undiscounted cashcontractual
flows. undiscounted cash flows. subsidiary Maritime and Mercantile
subsidiary
International
Maritime and
Holding
Mercantile
LLC. The
International
principal activities
Holding LLC. The principal activ
Overview
of these companies are wholesale
of these
andcompanies
retail of consumer
are wholesale
goods.
and
Revenue
retail ofand
consumer
profit goods. Revenue and p
Emirates Less than 2-5 Less than
Over 2-5 Over from the date of acquisition tofrom
31 March
the date
2018
of acquisition
is not material.
to 31 March 2018 is not material.
1 year years 5 years1 year Totalyears 5 years Total
dnata
AED m AED m AED mAED m
AED m AED m AED m AED m 40. Capital management 40. Capital management
Group
8 2018
Financial Emirates' objective when managing
Emirates'
capital
objective
is to when
safeguard
managing
its ability
capital
to continue
is to safeguard
as a its ability to continue
owings and lease
Information Borrowings and10,635
liabilities lease liabilities
28,514 10,63559,092
19,943 28,514 19,943 59,092
going concern in order to provide
going concern
returns for
in order
its Owner
to provide
and toreturns
maintain
foran
itsoptimal
Owner and to maintain an opt
Derivative financial 35
vative financial instruments instruments26 - 35 61 26 - 61
Emirates capital structure to reduce thecapital
cost ofstructure
capital. to reduce the cost of capital.
Financial
Commentary Emirates monitors the return
Emirates
on Owner's
monitors
equity,
the which
return isondefined
Owner'sasequity,
the profit
which is defined as the p
Provision for aircraft
ision for aircraft return conditions 704return conditions
1,980 1,331 704 4,015 1,980 1,331 4,015
dnata
dnata attributable to the Owner expressed
attributableastoa the
percentage
Owner expressed
of averageasOwner's
a percentage
equity. of average Owner's eq
Financial
Financial Emirates seeks to provide a better
Emirates
return
seeks
to the
to provide
Owner bya better
borrowing
returnand
to the
taking
Owner
aircraft
by borrowing and taking air
e and other payables
Commentary
Commentary Trade and other payables (excluding
(excluding
on operating leases to meet on
its operating
growth plans.
leases
In to
2018,
meet
Emirates
its growth
achieved
plans.a In
return
2018,on
Emirates achieved a return
passenger and 16,954
enger and cargo sales in advance) cargo sales in advance)
123 -16,95417,077 123 - 17,077
Emirates
Emirates Owner's equity funds of 7.9% Owner's
(2017: 3.8%).
equity funds of 7.9% (2017: 3.8%).
Consolidated
Consolidated 28,328 30,643 28,32880,245
21,274 30,643 21,274 80,245
Financial
Financial
7 Statements
Statements 2017 Emirates also monitors capitalEmirates
on the basis
also monitors
of a gearing
capital
ratioonwhich
the basis
is calculated
of a gearing
as the
ratio which is calculated as
ratio of borrowings and leaseratio
liabilities,
of borrowings
net of cash
andassets
lease to
liabilities,
total equity.
net ofIncash
2018,assets
this to total equity. In 2018,
owings Borrowings and12,319
dnataand lease liabilities lease liabilities
27,257 12,31958,719
19,143 27,257 19,143 58,719
Consolidated ratio is 82.8% (2017: 100.7%)ratio
and is
if aircraft
82.8% (2017:
operating
100.7%)
leases
andareif included,
aircraft operating
the ratioleases
is are included, the rat
vative financial
Financial Derivative financial105
instruments instruments69 - 105 174 69 - 174
Statements
216.4% (2017: 237.9%). 216.4% (2017: 237.9%).

ision
Additional Provision for aircraft
for aircraft return conditions 630return conditions
1,991 1,205 630 3,826 1,991 1,205 3,826
Information

Trade and other payables (excluding

e and other payables (excluding
passenger and 14,315
enger and cargo sales in advance) cargo sales in advance)
683 -14,31514,998 683 - 14,998
27,369 30,000 27,36977,717
20,348 30,000 20,348 77,717

138 43 43
THE EMIRATES GROUP
ANNUAL REPORT

2017-18

Independent Auditor’s Report to the Owner of dnata

Overview

Emirates

dnata

Group

Financial
Information
Our opinion Independence
Emirates In our opinion, the consolidated financial statements present fairly, in all material We are independent of dnata in accordance with the International Ethics Standards
Financial
Commentary respects, the consolidated financial position of dnata and its subsidiaries (together Board for Accountants’ Code of Ethics for Professional Accountants (“IESBA Code”)
referred to as “dnata”) as at 31 March 2018, and its consolidated financial performance and the ethical requirements that are relevant to our audit of the consolidated
dnata
Financial
and its consolidated cash flows for the year then ended in accordance with International financial statements in the United Arab Emirates. We have fulfilled our other ethical
Commentary Financial Reporting Standards (“IFRS”). responsibilities in accordance with these requirements and the IESBA Code.

Emirates What we have audited Our audit approach

Consolidated
Financial
Statements
dnata’s consolidated financial statements comprise: Overview
● the consolidated income statement for the year ended 31 March 2018; As part of designing our audit, we determined materiality and assessed the risks of
dnata
Consolidated ● the consolidated statement of comprehensive income for the year ended 31 March 2018; material misstatement in the consolidated financial statements. In particular, we
Financial considered where management made subjective judgements; for example, in respect
Statements ● the consolidated statement of financial position as at 31 March 2018;
of significant accounting estimates that involved making assumptions and considering
● the consolidated statement of changes in equity for the year ended 31 March 2018; future events that are inherently uncertain. As in all of our audits, we also addressed
Additional
Information ● the consolidated statement of cash flows for the year ended 31 March 2018; and the risk of management override of internal controls, including among other matters
● the notes to the consolidated financial statements, which include a summary of consideration of whether there was evidence of bias that represented a risk of material
significant accounting policies. misstatement due to fraud.

Basis for opinion
We conducted our audit in accordance with International Standards on Auditing
(“ISAs”). Our responsibilities under those standards are further described in the
Auditor’s responsibilities for the audit of the consolidated financial statements section
of our report.
We believe that the audit evidence we have obtained is sufficient and appropriate to
provide a basis for our opinion.
The area that in our professional judgement, is of most significance to the audit (“Key
audit matter”) and where we focused most audit effort during the year was:
Key audit matter ● Impairment of goodwill
We tailored the scope of our audit in order to perform sufficient work to enable us to
provide an opinion on the consolidated financial statements as a whole, taking into
account the structure of dnata, the accounting processes and controls, and the industry
in which dnata operates.

PricewaterhouseCoopers (Dubai Branch), License no. 102451, Emaar Square, Building 4, Level 8, P O Box 11987, Dubai - United Arab Emirates T: +971 4 304 3100, F: +971 4 346 9150, www.pwc.com/middle-east
Douglas O’Mahony, Paul Suddaby, Jacques Fakhoury and Mohamed ElBorno are registered as practising auditors with the UAE Ministry of Economy 139
THE EMIRATES GROUP
ANNUAL REPORT Independent Auditor’s Report to the Owner of dnata (continued)
2017-18

Key audit matters

Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the consolidated financial statements for the current year. These
matters were addressed in the context of our audit of the consolidated financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate
opinion on these matters.

Key audit matter How our audit addressed the Key audit matter
Overview

Emirates Impairment of goodwill We understood and tested management’s impairment models. In particular we
tested the appropriateness of the key assumptions within the models as follows:
dnata As at 31 March 2018, the carrying value of goodwill was AED 2,065 million (2017:
AED 1,909 million). Refer to notes 2, 3 and 10 to the consolidated financial ● we used our internal valuation specialists to perform an independent
Group
statements. calculation of the discount rates used with particular reference to comparable
Financial companies and compared this to the discount rates used by management.
Information Goodwill is not subject to amortisation and in accordance with IAS 36
“Impairment of assets” is required to be tested annually for impairment. ● we tested the mathematical accuracy of the model.
Emirates
Financial
Commentary
dnata determines the recoverable amount of goodwill for each of its cash ● we agreed the cash flows used in management’s impairment models to
generating units or groups of cash generating units as the higher of fair value less formally approved budgets. We compared future expected revenue growth
dnata costs of disposal and value in use. The value in use is determined by calculating rates and profit margins used in the formally approved budgets and beyond
Financial the period of the formally approved budgets to historical trends and reviewed
the discounted cash flows of each cash generating unit or groups of cash
Commentary
generating units. whether management’s estimates made in prior periods were reasonable
Emirates compared to actual performance.
Consolidated We considered this as a Key audit matter because management’s assessment
Financial ● we also compared the long term growth rates to external sources of
Statements
of whether or not goodwill within a cash generating unit was impaired, involves
complex and subjective judgements including assumptions about the future information including economic forecasts.
dnata discounted cash flows of cash generating units or groups of cash generating units
Consolidated at dnata. ● we performed sensitivity analysis over each of the significant assumptions and
Financial
considered the appropriateness of the related disclosures in note 10 to the
Statements
The impairment models prepared by management in respect of the cash consolidated financial statements.
Additional generating units containing goodwill determined that adequate headroom
Information existed not to result in the need for an impairment charge in reasonably possible
scenarios.

Other information Responsibilities of management and those charged with

Management is responsible for the other information. The other information comprises
governance for the consolidated financial statements
the information included in the Annual Report (but does not include the consolidated Management is responsible for the preparation and fair presentation of the
financial statements and our auditor’s report thereon). consolidated financial statements in accordance with IFRS, and for such internal control
as management determines is necessary to enable the preparation of consolidated
Our opinion on the consolidated financial statements does not cover the other
financial statements that are free from material misstatement, whether due to fraud
information and we do not express any form of assurance conclusion thereon.
or error.
In connection with our audit of the consolidated financial statements, our responsibility
In preparing the consolidated financial statements, management is responsible for
is to read the other information identified above and, in doing so, consider whether the
assessing dnata’s ability to continue as a going concern, disclosing, as applicable,
other information is materially inconsistent with the consolidated financial statements
matters related to going concern and using the going concern basis of accounting
or our knowledge obtained in the audit, or otherwise appears to be materially misstated.
unless management either intends to liquidate dnata or to cease operations, or has no
If, based on the work we have performed, we conclude that there is a material realistic alternative but to do so.
misstatement of this other information, we are required to report that fact. We have
Those charged with governance are responsible for overseeing dnata’s financial
nothing to report in this regard.
140 reporting process.
THE EMIRATES GROUP
ANNUAL REPORT Independent Auditor’s Report to the Owner of dnata (continued)
2017-18

Auditor’s responsibilities for the audit of the consolidated

financial statements
Our objectives are to obtain reasonable assurance about whether the consolidated
financial statements as a whole are free from material misstatement, whether due to
fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable
assurance is a high level of assurance, but is not a guarantee that an audit conducted
Overview in accordance with ISAs will always detect a material misstatement when it exists.
Misstatements can arise from fraud or error and are considered material if, individually
Emirates or in the aggregate, they could reasonably be expected to influence the economic
decisions of users taken on the basis of these consolidated financial statements.
dnata
As part of an audit in accordance with ISAs, we exercise professional judgement and
Group
maintain professional scepticism throughout the audit. We also:
Financial
Information ● Identify and assess the risks of material misstatement of the consolidated financial
statements, whether due to fraud or error, design and perform audit procedures
Emirates
responsive to those risks, and obtain audit evidence that is sufficient and appropriate
Financial
Commentary to provide a basis for our opinion. The risk of not detecting a material misstatement
resulting from fraud is higher than for one resulting from error, as fraud may involve
dnata
Financial
collusion, forgery, intentional omissions, misrepresentations, or the override of
Commentary internal control.
We communicate with those charged with governance regarding, among other matters,
the planned scope and timing of the audit and significant audit findings, including any
significant deficiencies in internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have complied
with relevant ethical requirements regarding independence, and to communicate with
them all relationships and other matters that may reasonably be thought to bear on our
independence, and where applicable, related safeguards.
From the matters communicated with those charged with governance, we determine
those matters that were of most significance in the audit of the consolidated financial
statements of the current year and are therefore the Key audit matters. We describe
these matters in our auditor’s report unless law or regulation precludes public disclosure
about the matter or when, in extremely rare circumstances, we determine that a matter
should not be communicated in our report because the adverse consequences of
doing so would reasonably be expected to outweigh the public interest benefits of
such communication.
PricewaterhouseCoopers
3 May 2018

Emirates ● Obtain an understanding of internal control relevant to the audit in order to design
Consolidated audit procedures that are appropriate in the circumstances, but not for the purpose
Financial
Statements of expressing an opinion on the effectiveness of dnata’s internal control.

dnata ● Evaluate the appropriateness of accounting policies used and the reasonableness of
Consolidated accounting estimates and related disclosures made by management. Douglas O’Mahony
Financial
Statements
Registered Auditor Number 834
● Conclude on the appropriateness of management’s use of the going concern basis Dubai, United Arab Emirates
Additional of accounting and, based on the audit evidence obtained, whether a material
Information uncertainty exists related to events or conditions that may cast significant doubt
on dnata’s ability to continue as a going concern. If we conclude that a material
uncertainty exists, we are required to draw attention in our auditor’s report to the
related disclosures in the consolidated financial statements or, if such disclosures are
inadequate, to modify our opinion. Our conclusions are based on the audit evidence
obtained up to the date of our auditor’s report. However, future events or conditions
may cause dnata to cease to continue as a going concern.

● Evaluate the overall presentation, structure and content of the consolidated financial
statements, including the disclosures, and whether the consolidated financial
statements represent the underlying transactions and events in a manner that
achieves fair presentation.

● Obtain sufficient appropriate audit evidence regarding the financial information

of the entities or business activities within dnata to express an opinion on the
consolidated financial statements. We are responsible for the direction, supervision
and performance of the dnata audit. We remain solely responsible for our
audit opinion.

141
 Consolidated Income Statement
THE EMIRATES GROUP
ANNUAL REPORT
dnata
2017-18
for the year
CONSOLIDATED INCOMEended
STATEMENT31 March 2018
FOR THE YEAR ENDED 31 MARCH 2018

Note 2018 2017

dnata
AED m AED m
CONSOLIDATED INCOME STATEMENT
Revenue 5 12,931 11,982
FOR THE YEAR ENDED 31 MARCH 2018
Other operating income 143 200
Operating costs Note
6 2018
(11,878) 2017
(10,958)
Overview
Operating profit 1,196
AED m 1,224
AED m
Emirates Finance income 98 66
Revenue 5 12,931 11,982
dnata Finance costs (31) (35)
Other operating income 143 200
Share of results of investments accounted for using the equity method 11 126 78
Group Operating costs 6 (11,878) (10,958)
Profit before income tax 1,389 1,333
Financial
Operating profit 1,196 1,224
Income tax expense 7 (37) (82)
Information Finance income 98 66
Profit for the year 1,352 1,251
Emirates Finance costs (31) (35)
Financial
Profit attributable to non-controlling interests 35 41
Share of results of investments accounted for using the equity method 11 126 78
Commentary Profit attributable to dnata's Owner 1,317 1,210
Profit before income tax 1,389 1,333
dnata CONSOLIDATED
Income STATEMENT OF COMPREHENSIVE INCOME
tax expense 7 (37) (82)
Financial
Commentary FOR THE
Profit for YEAR ENDED 31 MARCH 2018
the year 1,352 1,251
Emirates
Consolidated
Consolidated Statement of Comprehensive Income
Profit
Profitattributable
Profit
for the yearto non-controlling interests
Items that will not to
attributable bednata's Owner
reclassified to the consolidated income statement
35
1,352
1,317
41
1,251
1,210
for Remeasurement
the year of ended 31obligations
March net of2018
Financial
Statements
CONSOLIDATED retirement
STATEMENT benefit
OF COMPREHENSIVE INCOME deferred tax 2 124
dnata FOR THEShare
YEARof other
ENDED comprehensive
31 MARCH 2018income of investments accounted for using the equity method
Consolidated
net of deferred tax 11 42 (43)
Financial Profit for the year 1,352 1,251
Statements Items that are or may be reclassified subsequently to the consolidated income statement
Items that will not be reclassified to the consolidated income statement
Additional Currency translation differences 218 (159)
Information
Remeasurement of retirement benefit obligations net of deferred tax 2 124
Cash flow hedges (7) (8)
Share of other comprehensive income of investments accounted for using the equity method
Net investment hedge 22 (9) 4
net of deferred tax 11 42 (43)
Share of other comprehensive income of investments accounted for using the equity method
Items that are or may be reclassified subsequently to the consolidated income statement
net of deferred tax 11 7 21
Currency translation differences 218 (159)
Other comprehensive income for the year 253 (61)
Cash flow hedges (7) (8)
Total comprehensive income for the year 1,605 1,190
Net investment hedge 22 (9) 4
Total comprehensive income attributable to non-controlling interests 49 40
Share of other comprehensive income of investments accounted for using the equity method
Total comprehensive income attributable to dnata's Owner 1,556 1,150
net of deferred tax 11 7 21
Other comprehensive
The accompanying income
notes are anfor the year
integral part of these consolidated financial statements. 253 (61)
Total comprehensive income for the year 1,605 1,190
Total comprehensive income attributable to non-controlling interests 49 40
Total comprehensive income attributable to dnata's Owner 1,556 1,150

The accompanying notes are an integral part of these consolidated financial statements.
The accompanying notes are an integral part of these consolidated financial statements.
142
 Consolidated Statement of Financial Position
THE EMIRATES GROUP
a ANNUAL REPORT dnata
2017-18
as at 31 March 2018
NSOLIDATED STATEMENT OF FINANCIAL STATEMENT
CONSOLIDATED POSITION OF FINANCIAL POSITION
AT 31 MARCH 2018 AS AT 31 MARCH 2018

Note 2018 2017

Note 2018 2017 Note 2018 2017
Note 2018
AED m AED m AED m AED m AED m AED m AED m A
ETS ASSETS EQUITY AND LIABILITIES EQUITY AND LIABILITIES
-current assets Non-current assets Capital and reserves Capital and reserves
erty, plant and equipment 8
Property, plant and equipment 1,861 1,8478 1,861 1,847 Capital 15 63 63
Capital 15 63
stment property
Overview Investment property 9 338 2379 338 237 Capital reserve (60) (66)
Capital reserve (60)
ngible assets Intangible assets 10 2,788 2,632
10 2,788 2,632 Other reserves 16 (157) (355)
Emirates Other reserves 16 (157)
stments accounted for using the equity
Investments accounted for using the equity Retained earnings 7,257 6,897
dnata
Retained earnings 7,257 6
hod method 11 473 407
11 473 407 Attributable to dnata's Owner 7,103 6,539
Attributable to dnata's Owner 7,103 6
anceGroup
lease rentals Advance lease rentals 12 43 40
12 43 40 Non-controlling interests 179 167
Non-controlling interests 179
rred income tax assets Deferred income tax assets 24 81 62
24 81 62 Total equity 7,282 6,706
Financial Total equity 7,282 6
e and other receivables
Information
Trade and other receivables14 134 147
14 134 147
5,718 5,372 5,718 5,372 Non-current liabilities
Emirates Non-current liabilities
entFinancial
assets Trade and other payables
Commentary Current assets Trade and other payables 17 163 193
17 163
ntories Inventories 13 87 87
13 87 87 Borrowings and lease liabilities 21 867 654
Borrowings and lease liabilities 21 867
dnata
e and other receivables Trade and other receivables14 3,493 3,180
Financial 14 3,493 3,180 Deferred income tax liabilitiesDeferred income tax liabilities
24 142 148
24 142
vative financial instruments
Commentary 29
Derivative financial instruments - 5
29 - 5 Provisions 18 562 547
Provisions 18 562
me Emirates
tax asset Income tax asset 3 5 3 5 1,734 1,542 1,734 1
t term bank deposits
Consolidated
Short term bank deposits 28 3,760 2,016
28 3,760 2,016 Current liabilities
Financial Current liabilities
and cash equivalents Cash and cash equivalents 28 1,185 1,382 Trade and other payables Trade and other payables 17 4,848 3,351
Statements 28 1,185 1,382 17 4,848 3
8,528 6,675 8,528 6,675 Income tax liabilities 64 61
dnata Income tax liabilities 64
t classified as held
Consolidated for saleAsset classified as held for sale
11 46 -11 46 - Borrowings and lease liabilities 21 292 339
Financial Borrowings and lease liabilities 21 292
Statements 8,574 6,675 8,574 6,675 Provisions 18 47 45
Provisions 18 47
l assets Total assets 14,292 12,047 14,292 12,047 Derivative financial instruments 29 25 3
Additional Derivative financial instruments 29 25
Information 5,276 3,799 5,276 3
Total liabilities Total liabilities 7,010 5,341 7,010 5
Total equity and liabilities Total equity and liabilities 14,292 12,047 14,292 12

The consolidated financial

financial statements
statements were
were approved
approved
The consolidated on 33May
May2018
onstatements
financial 2018and signed
signedby:
andapproved
were by:
on 3 May 2018 and signed by

accompanying notes are an

Theintegral part of these
accompanying notesconsolidated financial
are an integral part ofstatements.
these consolidated financial statements.

Sheikh Ahmed bin Saeed Al-Maktoum Gary Chapman

Chairman and Chief Executive President

The accompanying notes are an integral part of these consolidated financial statements.
143
 Consolidated Statement of Changes in Equity
THE EMIRATES GROUP
ANNUAL REPORT

2017-18 dnata
for the year ended 31 March 2018
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MARCH 2018
Attributable to dnata's Owner
Non-
Capital Other Retained controlling Total
Note Capital reserve reserves earnings Total interests equity
AED m AED m AED m AED m AED m AED m AED m

Overview
1 April 2016 63 (67) (216) 5,607 5,387 167 5,554
Profit for the year - - - 1,210 1,210 41 1,251
Emirates
Other comprehensive income for the year - - (141) 81 (60) (1) (61)
dnata Total comprehensive income for the year - - (141) 1,291 1,150 40 1,190
Non-controlling interest on acquisition of subsidiaries 33 - - - - - 11 11
Group
Acquired from non-controlling interest - 2 - - 2 (2) -
Financial Dividends - - - - - (53) (53)
Information
Option to acquire non-controlling interest 33 - (1) - - (1) - (1)
Emirates Transfer from retained earnings - - 2 (2) - - -
Financial
Commentary Capital contribution - - - - - 4 4
Transactions with Owners - 1 2 (2) 1 (40) (39)
dnata
Financial Share of other equity movements of investments
Commentary
accounted for using the equity method 11 - - - 1 1 - 1
Emirates 31 March 2017 63 (66) (355) 6,897 6,539 167 6,706
Consolidated
Financial Profit for the year - - - 1,317 1,317 35 1,352
Statements
Other comprehensive income for the year - - 195 44 239 14 253
dnata Total comprehensive income for the year - - 195 1,361 1,556 49 1,605
Consolidated
Financial
Acquired from non-controlling interest - 5 - - 5 (4) 1
Statements Dividends - - - (1,000) (1,000) (44) (1,044)

Additional
Transfer from retained earnings - 1 - (1) - - -
Information Dilution of interest in a subsidiary - - - - - 11 11
Transactions with Owners - 6 - (1,001) (995) (37) (1,032)
Share of other equity movements of investments
accounted for using the equity method 11 - - 3 - 3 - 3
31 March 2018 63 (60) (157) 7,257 7,103 179 7,282

The capital reserve includes the difference between the carrying value of the non-controlling interest acquired and the fair value of the consideration paid. It also
includes the fair value of the options issued by dnata to acquire the non-controlling interest in subsidiaries.

The accompanying notes are an integral part of these consolidated financial statements.

The accompanying notes are an integral part of these consolidated financial statements.
144
 Consolidated Statement of Cash Flows
THE EMIRATES GROUP
ANNUAL REPORTdnata
a 2017-18
for
SOLIDATED STATEMENT
the
OF THE
CASHYEAR
year ended 31 March 2018
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR ENDED 31 MARCH 2018
FLOWS
Note 2018 2
THE YEAR ENDED 31 MARCH 2018
Note 2018 2017 Note 2018 2017 AED m AE

Note 2018 2017 AED m AED m Investing activities AED m AED m

Operating activities Investing activities Additions to property, plant and equipment 8 (308) (
AED m AED m
Profit before income tax 1,389 1,333 Additions
Additions to property, plant and to investment property
equipment 8 (308) (479)9 (111)
rating activities
Adjustments for: Additions
Additions to investment property to intangible assets
9 (111) 10
(73) (92)
t before income tax 1,389 1,333
Overview
stments for: Depreciation and amortisation 6 531 524 Additions to intangible assets Proceeds from sale of property,
10 plant and
(92) (55)
equipment 8
Emirates and amortisationFinance income - net
preciation 6 531 524 (67) (31) Proceeds from sale of property, plant and
Amortisation of advance lease rentals (67) 12 3 3 equipment Investments in associates and joint ventures
8 11
58 (5)
nance income - net
dnata
(31)
mortisation of advance leaseShare of results of investments
rentals 12 accounted
3 for 3 Investments in associates and Dividends from investments
joint ventures 11accounted for
(5)using (28)
Group using the equity method 11 (126) (78) the equity method
Dividends from investments accounted for using 11 31
are of results of investments accounted for
Loss / (gain) on sale of property, plant and the equity method Acquisition of subsidiaries,11
net of cash acquired
31 33
28 (12) (
ng Financial
the equity method 11 (126) (78)
Information equipment
ss / (gain) on sale of property, and intangibles
plant and 3 (1) Acquisition of subsidiaries, netLoans to acquired
of cash related parties - net
33 (12) 31
(582) 12
Net provision for impairment of trade Loans to related parties - net Movement in short term bank
31 deposits 12 19 (1,744)
uipment and intangibles
Emirates 3 (1)
Movement in short term bankFinance
depositsincome 75
Financial
t provision
Commentaryfor receivables
impairment of trade 14 86 28 (1,744) 114
Provision for retirement 14
benefit obligations Acquired from non-controlling interest 75 (11)
ceivables 86 286 259 253 Finance income 39
Acquired from non-controllingNet cash used in investing activities (11) (2,157) (
dnata
ovision for retirement
Financial benefitNet movement on derivative
obligations 6 financial259 253 interest (2)
Commentary instruments
t movement on derivative financial 17 32 Net cash used in investing activities (2,157) (961)
Financing activities
truments
Emirates Payments for retirement benefit obligations
17 32 (231) (221)
Financing activities Proceeds from loans 22 475
Consolidated
ments Income
for retirement benefit tax paid
obligations (231) (221) (86) (69)
Financial
Proceeds from loans Repayment of loans 22 475 22
515 (306) (
Statements
me tax paid Change in inventories (86) (69) 4 (4)
Repayment of loans Net movement in lease liabilities
22 (306) (192) (9)
nge dnata
in inventories Change in trade and other receivables 4 (4) (213) (578)
Finance costs
Net movement in lease liabilities (9) 4 (29)
Consolidated
nge Financial
in trade and Change in provisions, trade and other payables
other receivables (213) (578) 289 90
Finance costs Dividends paid to dnata's Owner (29) (20) - (
Statements Net
nge in provisions, trade and cashpayables
other generated from operating activities
289 90 1,858 1,281
Dividends paid to non-controlling interests
Dividends paid to dnata's Owner - (400) (53)
cash generated from operating activities
Additional 1,858 1,281 Net cash generated from / (used in) financing activities 78 (
Information Dividends paid to non-controlling interests (53) (53)
Net cash generated from / (used in) financing activities 78 (146)
Net change in cash and cash equivalents (221)

Net change in cash and cash equivalents (221) 174

Cash and cash equivalents at beginning of year 1,250 1
Effects of exchange
Cash and cash equivalents at beginning of year rate changes 1,250 1,190 83 (
The accompanying notes are an integral part of these consolidated financial statements.
Cash
Effects of exchange rate changes and cash equivalents at end of year
83 28
(114) 1,112 1,
accompanying notes are an integral part of these consolidated financial statements.
Cash and cash equivalents at end of year 28 1,112 1,250

The accompanying notes are an integral part of these consolidated financial statements.
145
 Notes to the Consolidated Financial Statements
THE EMIRATES GROUP
ANNUAL REPORT

2017-18
for the year ended 31 March 2018
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2018
New standards, amendments to published standards and interpretations that are
relevant to dnata

NOTES TOinformation
1. General THE CONSOLIDATED FINANCIAL STATEMENTS Effective
New and adopted
standards, in the current
amendments year standards and interpretations that are
to published
FOR THE YEAR ENDED 31 MARCH 2018 relevant to dnata
dnata comprises dnata and its subsidiaries. dnata was incorporated in the Emirate of At the date of authorisation of these consolidated financial statements, certain
Dubai, UAE information
with limited liability, under an Emiri Decree issued by H.H. Sheikh Maktoum amendments
Effective and to the existing
adopted in thestandards were effective for the current financial year and
current year
1. General
bin Rashid Al-Maktoum on 4 April 1987. On that date, the total assets and liabilities of have been adopted by dnata. These are as follows:
Dubai comprises
dnata National Air Travel
dnata andAgency were transferred
its subsidiaries. to dnata,
dnata was with effect
incorporated in thefrom 1 April
Emirate of At the date of authorisation of these consolidated financial statements, certain
1987, for  Amendments
amendments to IAS
to the 7, Statement
existing standards ofwere
Cash effective
Flows (effective
for the from 1 January
current 2017)
financial year and
Overview Dubai, UAEnilwith
consideration. dnata
limited liability, is wholly
under owned
an Emiri Decreeby issued
the Investment Corporation
by H.H. Sheikh Maktoum of
Dubai (“theAl-Maktoum
parent company”), a Government  Amendments
have been adoptedtobyIFRS 12, These
dnata. Disclosure
are asof Interests in Other Entities (effective from 1
follows:
bin Rashid on 4 April 1987. On of Dubai
that date,entity.
the total assets and liabilities of
Emirates January 2017)
Dubai National Air Travel Agency were transferred to dnata, with effect from 1 April
dnata for
is incorporated and domiciled Amendments to
 Amendments to IAS
IAS 7,
12,Statement
Income taxes (effective
of Cash Flows from 1 January
(effective 2017)
from 1 January 2017)
1987, nil consideration. dnata isinwholly
Dubai,owned
UAE. The
by address of its registered
the Investment officeof
Corporation is
dnata
Dnata (“the
Dubai Travelparent
Centre, PO Box 1515,
company”), Dubai, UAE.of Dubai entity.
a Government  Amendments to IFRS 12, Disclosure of Interests in Other Entities (effective from 1
These amendments
January 2017) did not have a material impact on the consolidated financial
Group
The main
dnata activities of dnata
is incorporated comprise:in Dubai, UAE. The address of its registered office is
and domiciled statements. However,
Amendments disclosure
to IAS changes
12, Income arising from
taxes (effective fromamendments to IAS 7 have been
1 January 2017)
Financial addressed in Note 23 through presentation of changes in opening and closing balances
Information
Dnata Travel Centre, PO Box 1515, Dubai, UAE.
 Ground and cargo handling services of leaseamendments
These liabilities. did not have a material impact on the consolidated financial
Emirates The Travel
 services of dnata comprise:
main activities statements. However, disclosure changes arising from amendments to IAS 7 have been
Financial  Inflight catering Not yet effective
addressed in Note and have not
23 through been early of
presentation adopted
changes in opening and closing balances
Commentary
 Ground and cargo handling services of lease liabilities.
At the date of authorisation of these consolidated financial statements, certain new
dnata 2. Summary of significant accounting policies
Travel services
Financial accounting
Not standards
yet effective have not
and have been published
been that are not mandatory for the financial
early adopted
Commentary
 Inflight catering
A summary of the significant accounting policies, which have been applied consistently reporting year ended 31 March 2018, and have not been early adopted.
Emirates in the
2. preparation
Summary of these consolidated
of significant accounting financial
policies statements, are set out below. At the date of authorisation of these consolidated financial statements, certain new
Consolidated Management
accounting has assessed
standards havethe impact
been of thesethat
published accounting
are not standards:
mandatory for the financial
Financial
Statements Basis
A of preparation
summary of the significant accounting policies, which have been applied consistently reporting year ended 31 March 2018, and have not been early adopted.
IFRS 9, Financial Instruments (effective from 1 January 2018)
in the preparation of these consolidated financial statements, are set out below.
dnata The consolidated financial statements have been prepared in accordance with Management has assessed the impact of these accounting standards:
Consolidated dnata will adopt IFRS 9 which addresses the classification, measurement and
Financial International
Basis Financial Reporting Standards (IFRS) and IFRS Interpretations Committee
of preparation
Statements (IFRS IC) pronouncements. The consolidated financial statements are prepared under the derecognition
IFRS of financial
9, Financial assets
Instruments and financial
(effective from liabilities,
1 Januaryintroduces
2018) new rules for hedge
historical cost convention, accounting and a new impairment model for financial assets from 1 April 2018.
Additional The consolidated financialexcept for thosehave
statements financial
beenassets and financial
prepared liabilities with
in accordance that
Information are measuredFinancial
International at fair value as stated
Reporting in the accounting
Standards policies.
(IFRS) and IFRS Interpretations Committee dnata will adopt IFRS 9 which addresses the classification, measurement and
dnata has reviewed
derecognition the new
of financial requirements
assets applicable
and financial to introduces
liabilities, its financialnew
assets
rulesandfor ithedge
does
(IFRS IC) pronouncements. The consolidated financial statements are prepared under the
All amounts areconvention,
presented in millions not expect the
accounting andnew
a newguidance to affect
impairment modelthefor
classification and from
financial assets measurement of its financial
1 April 2018.
historical cost except for of UAEfinancial
those Dirham (“AED”).
assets and financial liabilities that
assets. There will be no impact on dnata’s financial liabilities as the new requirements
are measured at fair value as stated in the accounting policies.
only affect
dnata the accounting
has reviewed the newforrequirements
financial liabilities that are
applicable to designated
its financialatassets
fair value
andthrough
it does
profit
not or loss
expect theand
newdnata does not
guidance have the
to affect suchclassification
liabilities of and
a significant value. of its financial
measurement
All amounts are presented in millions of UAE Dirham (“AED”).
assets. There will be no impact on dnata’s financial liabilities as the new requirements
only affect the accounting for financial liabilities that are designated at fair value through
profit or loss and dnata does not have such liabilities of a significant value.

146
THE EMIRATES GROUP
ANNUAL REPORT
2017-18
2. Summary of significant accounting policies (continued)
IFRS 9, Financial Instruments (effective from 1 January 2018) (continued)
The new impairment model under IFRS 9 requires the recognition of impairment
provisions based on expected credit losses (ECL) rather than only incurred credit losses
as is the case under IAS 39. It applies to trade receivables and other financial assets.
Overview
Based on the assessments undertaken, dnata does not expect any significant change in
Emirates the loss allowance for these financial assets.
dnata
The new guidance has substantially reformed the existing hedge accounting rules. It
Group provides a more principles-based approach that aligns hedge accounting closely with
risk management policies. dnata does not expect any significant impact on its hedge
Financial accounting under IFRS 9.
Information
Emirates The new standard also introduces expanded disclosure requirements and changes in
Financial presentation, however, these are not expected to materially change the nature and
Commentary
extent of dnata’s disclosures about its financial instruments.
dnata
Financial IFRS 15, Revenue from Contracts with Customers (effective from 1 January 2018)
Commentary
Emirates IFRS 15 replaces IAS 18 which covers contracts for sale of goods and rendering of
Consolidated services and IAS 11 which covers construction contracts.
Financial
Statements
The new standard is based on the principle that revenue is recognised when control of a
dnata good or service transfers to a customer – so the notion of control replaces the existing
Consolidated
Financial notion of risks and rewards. The standard provides a new five-step model that must
Statements be applied to all contracts with customers.
Additional
Information dnata will adopt the modified retrospective method on transition to the new standard
from 1 April 2018 and the comparatives will not be restated. The following change to
revenue recognition has been identified on the adoption of IFRS 15:
・ Revenue from travel services – Where dnata acts as principal on sale of holiday
packages, IFRS 15 requires that the total consideration received must be allocated to the
separate performance obligations based on relative stand-alone selling prices and
revenue should be recognised on satisfaction of each performance obligation within a
single contract with the customer. Currently, dnata recognises full revenue on such travel
packages at the time of departure. dnata expects an immaterial impact on its revenue
and profits due to this change in recognition on adoption of IFRS 15 on 1 April 2018.
IFRS 16, Leases (effective from 1 January 2019)
IFRS 16 removes the current distinction between operating and finance leases and
requires recognition of an asset (the right to use the leased item) and a financial liability
(the obligation to pay rentals). An optional exemption exists for short-term and low-
value leases.
The standard will have significant impact on dnata's consolidated financial
statements considering the size of operating leases in its portfolio. For example, the
consolidated income statement will be impacted because the total expense is typically
higher in the earlier years of a lease and lower in later years. Additionally, operating
lease charges will be replaced with interest and depreciation expenses. This will affect
key ratios like profit margin, operating margin, EBITDA margin etc. Further,
operating cash flows will be higher as cash payments for the principal portion of the
lease liability will be classified within financing activities. dnata is currently assessing
the detailed financial impact of this standard on its consolidated financial statements.
There are no other standards, amendments or interpretations that are either effective or
not yet effective, and would be expected to have a material impact on dnata.
Basis of consolidation
Subsidiaries are those entities over which dnata has control. Control is exercised when
dnata is exposed to, or has rights to, variable returns from its involvement with the entity
and has the ability to affect those returns through its power over the entity. Subsidiaries
are fully consolidated from the date on which control is transferred to dnata and are de-
consolidated from the date on which control ceases. Inter-company transactions,
balances and unrealised gains and losses arising on transactions between dnata and
subsidiaries are eliminated.
The acquisition method of accounting is used to account for business combinations by
dnata. The consideration transferred for the acquisition of a subsidiary comprises the
fair value of assets transferred, liabilities pertaining to the former owners of the
subsidiary, fair value of any contingent consideration arrangements and the fair value of
any pre-existing equity interest in the subsidiary. Acquisition-related costs are expensed
as incurred. Identifiable assets, including intangible assets acquired, liabilities and
contingent liabilities, if any, incurred or assumed in a business combination, are
measured initially at their fair values at the acquisition date. Any non-controlling interest
in the subsidiary is recognised on an acquisition-by-acquisition basis, either at fair value
or at the non-controlling interest’s proportionate share of the recognised amounts of
subsidiaries’ identifiable net assets.
Contingent consideration is classified either as equity or a financial liability. Amounts
classified as a financial liability are subsequently remeasured at fair value with changes in
fair value recognised in the consolidated income statement.
147
THE EMIRATES GROUP
ANNUAL REPORT

2017-18

2. Summary of significant accounting policies (continued) When dnata ceases to have control, any retained interest in the entity or business is
remeasured to its fair value at the date when control is lost, with the change in the
Basis of consolidation (continued) carrying amount recognised in the consolidated income statement. The fair value
becomes the initial carrying amount for the purposes of subsequently accounting for the
If the business combination is achieved in stages, the acquisition date carrying value of retained interest as an associate, joint venture or financial asset. In addition, any amounts
the dnata’s previously held equity interest in the subsidiary is remeasured at fair value at previously recognised in other comprehensive income in respect of that entity or
the acquisition date. Any gains or losses arising from such remeasurement are business are accounted for as if the related assets and liabilities have been directly
Overview
recognised in the consolidated income statement. disposed of. This may mean that amounts previously recognised in other comprehensive
Emirates income are reclassified to the consolidated income statement. If the ownership in a joint
dnata treats transactions with non-controlling interests that do not result in loss of venture or an associate is reduced but joint control or significant influence is retained,
dnata
control as transactions with the owners. A change in ownership interest results in an only a proportionate share of the amounts previously recognised in other
Group adjustment between the carrying amounts of the controlling and non-controlling comprehensive income are reclassified to the consolidated income statement where
interests to reflect their relative interests in the subsidiary. appropriate.
Financial
Information
Any difference between amount of the adjustment to non-controlling interests and any Revenue
Emirates consideration paid is recorded in equity.
Financial Revenue is measured at fair value of the consideration received or receivable, and
Commentary
Associates are those entities in which dnata has significant influence but not control or represents amounts receivable for goods supplied or services provided, stated net of
dnata joint control generally accompanying a shareholding between 20% and 50% of the discounts, returns and value added tax.
Financial voting rights. Significant influence is the power to participate in the financial and
Commentary
operating policy decisions of the investee, but is not control or joint control over those Revenue from airport operations which includes ground handling and cargo services is
Emirates policies. Investments in associates are accounted for by applying the equity method and recognised on the performance of services.
Consolidated include goodwill (net of accumulated impairment loss, if any) identified on acquisition
Financial
Statements after initially being recognised at cost. Revenue from travel services includes inclusive tours and agency commission earned
from the sale of third-party travel products. Revenue relating to inclusive tours is
dnata Joint ventures are contractual arrangements which establish joint control and where recognised on departure, while agency commission is recognised on the completion of
Consolidated
Financial dnata has rights to the net assets of the arrangement. Joint control is the contractually sale. Where dnata acts as principal, revenue is stated at the contractual value of services
Statements agreed sharing of control of an arrangement, which exists only when decisions about the provided and where dnata acts as an agent between the service provider and the end
relevant activities require the unanimous consent of the parties sharing control. customer, revenue is presented on a net basis.
Additional
Information Investments in joint ventures are accounted for by applying the equity method and
include goodwill (net of accumulated impairment loss, if any) identified on acquisition Revenue from the sale of goods (including inflight catering) is recognised when the
after initially being recognised at cost. risks and rewards of ownership are transferred to the customer.

When dnata’s share of losses in an equity-accounted investment equals or exceed its Finance income and costs
interest in the entity, including any other unsecured long term receivables, dnata does
not recognise further losses, unless it has incurred obligations or made payments on Interest income and costs are recognised on a time proportion basis using the effective
behalf of the other entity. interest method.

All material unrealised gains and losses arising on transactions between dnata and its
associates and joint ventures are eliminated to the extent of dnata’s interest.
Accounting policies of subsidiaries, associates and joint ventures have been changed
where necessary to ensure consistency with dnata’s accounting policies.
Foreign currency translation
dnata’s consolidated financial statements are presented in UAE Dirham (“AED”), which is
also the parent company’s functional currency. Subsidiaries, associates and joint ventures
determine their own functional currency and items included in the financial statements
of these companies are measured using that functional currency.

148
THE EMIRATES GROUP
ANNUAL REPORT

2017-18

2. Summary of significant accounting policies (continued) Land is not depreciated. Depreciation on other items of property, plant and equipment is
calculated using the straight line method to allocate their cost, less estimated residual
Foreign currency translation (continued) values, over the estimated useful lives of the assets or lease term, if shorter. The
estimated useful lives are:
Foreign currency transactions are translated into the functional currency, at the exchange
rates prevailing at the transaction dates. Monetary assets and liabilities denominated in Buildings 15 - 33 years
foreign currencies are translated into the functional currency at exchange rates Leasehold property shorter of useful life or lease term
Overview
prevailing at the end of the reporting period. The resultant foreign exchange gains and Plant and machinery 4 - 15 years
Emirates losses, other than those on qualifying net investment hedges and net investment in Office equipment and furniture 3 - 6 years
foreign operations deferred in other comprehensive income, are recognised in the Motor vehicles 5 -7 years
dnata
consolidated income statement.
Group The assets’ residual values and useful lives are reviewed, and adjusted if appropriate, at
Where functional currencies of subsidiaries are different from AED, income and cash flow the end of each reporting period.
Financial statements of subsidiaries are translated into AED at average exchange rates for the year
Information
that approximate the cumulative effect of rates prevailing on the transaction dates and Capital projects are stated at cost. When the asset is ready for its intended use, it is
Emirates their assets and liabilities are translated at the exchange rates prevailing at the end of transferred from capital projects to the appropriate category under property, plant and
Financial the reporting period. The resulting exchange differences are recognised in other equipment and depreciated in accordance with dnata’s policies.
Commentary
comprehensive income.
dnata An item of property, plant and equipment is derecognised upon disposal or when no
Financial Share of results of investments accounted for using the equity method are translated future economic benefits are expected from its use or disposal. Gains and losses on
Commentary
into AED at average exchange rates for the year whereas dnata’s share of net disposal are determined by comparing proceeds with the carrying amount and are
Emirates investments is translated at the exchange rate prevailing at the end of the reporting recognised in the consolidated income statement.
Consolidated period. Translation differences relating to investments in associates, joint ventures and
Financial
Statements monetary assets and liabilities that form part of a net investment in a foreign operation Investment property
are recognised in other comprehensive income. When investments in associates, joint
dnata ventures or net investment in a foreign operation are disposed of, the related Property held for long term rental yields or for capital appreciation or both, and not
Consolidated
Financial translation differences previously recorded in equity are recognised in the consolidated occupied by dnata, is classified as investment property.
Statements income statement as part of the gain or loss on disposal.
Investment property comprises land and buildings. Investment property is measured
Additional
Information Goodwill and fair value adjustments arising on the acquisition of a foreign entity are initially at its cost, including related transaction costs and borrowing costs. The carrying
treated as assets and liabilities of the foreign entity and translated at the exchange rates amount of an investment property includes the cost of replacing part of an existing
prevailing at the end of the reporting period. Exchange differences arising are investment property when incurred if the recognition criteria are met and excludes cost
recognised in other comprehensive income. of day-to-day servicing.

Property, plant and equipment Investment property is measured at cost less accumulated depreciation. Land is not
depreciated. Depreciation on investment property is charged on a straight line basis over
Property, plant and equipment is stated at cost less accumulated depreciation. Cost the estimated useful lives of such assets as follows:
consists of purchase cost, together with any incidental expenses of acquisition.
Buildings 20 years
Subsequent costs are included in the asset’s carrying amount or recognised as a
separate asset, as appropriate, only when it is probable that future economic benefits
The assets’ useful life is reviewed, and adjusted if appropriate, at the end of each
associated with the items will flow to dnata and the cost can be reliably measured.
reporting period.
Repairs and maintenance are charged to the consolidated income statement during the
period in which they are incurred.

149
THE EMIRATES GROUP
ANNUAL REPORT

2017-18

2. Summary of significant accounting policies (continued) Intangible assets are amortised on a straight-line basis over their estimated useful life.
The useful lives of intangible assets are:
Investment property (continued)
Computer software 3 - 5 years
An item of investment property is derecognised upon disposal or when no future Trade names 10 years
economic benefits are expected from its use or disposal. Gains and losses on disposal Customer relationships 3 - 10 years
are determined by comparing proceeds with the carrying amount and are recognised in Contractual rights over the expected term of the rights
Overview
the consolidated income statement.
Emirates The intangible assets’ useful lives are reviewed, and adjusted if appropriate, at the end of
Goodwill each reporting period.
dnata

Group Goodwill represents the excess of the aggregate of the consideration transferred, Impairment of non-financial assets
amount of any non-controlling interest in the acquired entity and the acquisition-date
Financial fair value of any previous equity interest in the acquired entity over the fair value of the Goodwill is not subject to amortisation and is tested annually for impairment. Other non-
Information
net identifiable assets at the date of acquisition. financial assets are reviewed for impairment whenever events or changes in
Emirates circumstances indicate that the carrying amount may not be recoverable. An impairment
Financial Goodwill is tested for impairment annually or more frequently if events or changes in loss is recognised for the amount by which the asset’s carrying amount exceeds its
Commentary
circumstances indicate a potential impairment and is carried at cost less accumulated recoverable amount. The recoverable amount is the higher of an asset’s fair value less
dnata impairment losses, if any. For the purpose of impairment testing, goodwill is allocated to costs to sell and value in use. For the purpose of assessing impairment, assets are
Financial cash generating units or group of cash generating units that are expected to benefit grouped at the lowest levels for which there are separately identifiable cash flows (cash
Commentary
from the business combination in which the goodwill arose. An impairment loss is generating units). Non-financial assets other than goodwill are reviewed at the end of
Emirates recognised when the carrying value of the cash generating unit or group of cash each reporting period for possible reversal of the impairment loss.
Consolidated generating units exceeds its recoverable amount. Impairment losses on goodwill are not
Financial
Statements reversed. Loans and receivables

dnata Gains and losses on disposal of an entity include the carrying amount of goodwill Loans and receivables are non-derivative financial assets with fixed or determinable
Consolidated
Financial relating to the entity sold. payments that are not quoted in an active market. Such amounts are initially recognised
Statements at fair value including transaction costs and subsequently measured at amortised cost
Other intangible assets using the effective interest method. The amounts are derecognised when rights to
Additional
Information receive cash flows have expired or have been transferred along with substantially all the
Computer software is capitalised at cost only when future economic benefits are risks and rewards of ownership.
probable. Cost includes purchase price together with any directly attributable
expenditure. At the end of each reporting period, an assessment is made as to whether there is any
objective evidence of impairment. Where necessary the carrying amount is written down
In the case of internally developed computer software, development expenditure is through the consolidated income statement to the present value of expected future cash
capitalised if costs can be measured reliably, the product is technically and commercially flows discounted at the effective interest rate computed at initial recognition.
feasible, future economic benefits are probable, and there exists an intent and ability to
complete the development and to use or sell the asset. Other research and development Finance and operating leases
expenditure not meeting the criteria for capitalisation are recognised in the consolidated
income statement as incurred. Where property, plant and equipment has been financed by lease agreements under
which substantially all of the risks and rewards incidental to ownership are transferred to
Trade names, customer relationships and contractual rights are recognised on dnata, they are classified as finance leases.
acquisition at fair values. Contractual rights also include licenses to operate in certain
airports.

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2. Summary of significant accounting policies (continued) Borrowings

Finance and operating leases (continued) Borrowings are recognised initially at fair value, net of transaction costs incurred.
Borrowings are subsequently measured at amortised cost with any difference between
Finance leases are capitalised at the commencement of the lease at the lower of the the proceeds (net of transaction costs) and the redemption value recognised in the
present value of the minimum lease payments or the fair value of the leased asset. The consolidated income statement over the period of the borrowings using the effective
corresponding lease obligations are included under liabilities. Lease payments are interest method.
Overview
treated as consisting of capital and interest elements. The interest element is charged to
Emirates the consolidated income statement over the lease term so as to produce a constant Provisions
periodic rate of interest on the remaining balance of the liability. Property, plant and
dnata
equipment acquired under finance leases are depreciated in accordance with dnata’s Provisions are recognised when dnata has a present legal or constructive obligation as a
Group policies. result of past events, it is probable that an outflow of resources will be required to settle
the obligation and the amount can be reliably estimated. Provisions are measured at the
Financial Leases, where a significant portion of risks and rewards of ownership are retained by the present value of the expenditures expected to settle the obligation using a pre-tax rate
Information
lessor are classified as operating leases. Lease rental charges, including advance rentals that reflects current market assessments of the time value of money and risks specific to
Emirates in respect of operating leases, are charged to the consolidated income statement on a the obligation. The increase in the provision due to passage of time is recognised as an
Financial straight-line basis over the period of the lease. interest expense.
Commentary

dnata Inventories Retirement benefit obligations

Financial
Commentary
Inventories are stated at the lower of cost and estimated net realisable value. Cost is dnata operates or participates in various end of service benefit plans, which are classified
Emirates determined on the weighted average cost basis except for food and beverage inventory either as defined contribution or defined benefit plans.
Consolidated which is determined on a first-in-first-out basis.
Financial
Statements A defined contribution plan is a pension scheme under which dnata pays fixed
Trade receivables contributions and has no legal or constructive obligation to pay further contributions if
dnata the fund does not hold sufficient assets to settle the benefits relating to the employees
Consolidated
Financial Trade receivables are initially recognised at fair value and subsequently measured at service in the current and prior periods. Contributions to the pension fund are charged
Statements amortised cost using the effective interest method less provision for impairment. Where to the consolidated income statement in the period in which they fall due.
there is objective evidence of amounts that are not collectible, a provision is made for
Additional
Information the difference between the carrying amount and the present value of estimated future A defined benefit plan is a plan which is not a defined contribution plan. The liability
cash flows discounted at the original effective interest rate. recognised in the consolidated statement of financial position for a defined benefit plan
is the present value of the defined benefit obligation at the end of the reporting period
Cash and cash equivalents less the fair value of plan assets at that date. The defined benefit obligation is calculated
by independent actuaries using the projected unit credit method.
Cash and cash equivalents comprise all cash and liquid funds with an original maturity of
three months or less. Other bank deposits with a maturity of less than a year are The present value of the defined benefit obligation is determined by discounting
classified as short term bank deposits. Bank overdrafts are shown within current estimated future cash outflows using market yields of high quality corporate bonds at
borrowings and lease liabilities in the consolidated statement of financial position. the end of the reporting period that are denominated in currency in which the benefits
will be paid and have terms approximating to the estimated term of the post-
employment benefit obligations.

Actuarial gains and losses arising from changes in actuarial assumptions and experience
adjustments are recognised in equity through other comprehensive income in the period
in which they arise.

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2.
2. Summary
Summary of
of significant
significant accounting
accounting policies
policies (continued)
(continued) Offsetting
Offsetting of
of financial
financial assets
assets and
and liabilities
liabilities

Income
Income tax
tax Financial
Financial assets
assets and
and liabilities
liabilities are
are offset
offset and
and the
the net
net amount
amount reported
reported in
in the
the consolidated
consolidated
statement
statement of of financial
financial position
position only
only when
when there
there isis aa legally
legally enforceable
enforceable right
right to
to offset
offset the
the
The
The tax
tax expense
expense for
for the
the year
year comprises
comprises current
current and
and deferred
deferred tax.
tax. recognised
recognised amounts
amounts and and there
there isis an
an intention
intention to
to settle
settle on
on aa net
net basis
basis or
or realise
realise the
the asset
asset
and
and settle
settle the
the liability
liability simultaneously.
simultaneously. The The legally
legally enforceable
enforceable right
right must
must not not be
be
The
The current
current income
income tax
tax charge
charge isis calculated
calculated onon the
the basis
basis ofof the
the tax
tax laws
laws enacted
enacted or
or contingent
contingent on on future
future events
events and
and must
must be
be enforceable
enforceable in in the
the normal
normal course
course ofof business
business
Overview
substantively
substantively enacted
enacted at
at the
the end
end ofof the
the reporting
reporting period
period in
in the
the countries
countries where
where dnata’s
dnata’s and
and in
in the
the event
event ofof default,
default, insolvency
insolvency or or bankruptcy.
bankruptcy.
Emirates subsidiaries
subsidiaries operate
operate and
and generate
generate taxable
taxable income.
income.
Derivative
Derivative financial
financial instruments
instruments
dnata
Deferred
Deferred income
income tax tax isis recognised
recognised in in full,
full, using
using the the liability
liability method,
method, on on temporary
temporary
Group differences
differences arising
arising between
between the the tax
tax bases
bases of of assets
assets and
and liabilities
liabilities and
and their
their carrying
carrying Derivative
Derivative financial
financial instruments
instruments are are initially
initially recognised
recognised at at fair
fair value
value on on the
the date
date aa
amounts
amounts in in the
the consolidated
consolidated financial
financial statements.
statements. However,
However, deferred
deferred income
income tax tax isis not
not derivative
derivative contract
contract isis entered
entered into
into and
and are
are subsequently
subsequently remeasured
remeasured at at their
their fair
fair value.
value.
Financial accounted
accounted for for ifif itit arises
arises from
from initial
initial recognition
recognition of of an
an asset
asset or or liability
liability in
in aa transaction
transaction Derivatives
Derivatives are are designated
designated as as aa hedge
hedge ofof the
the exposure
exposure to to variability
variability in
in cash
cash flows
flows that
that isis
Information
other
other than
than aa business
business combination
combination that that atat the
the time
time ofof the
the transaction
transaction affects
affects neither
neither attributable
attributable to to aa particular
particular risk
risk associated
associated with
with aa recognised
recognised assetasset or
or liability
liability or
or aa highly
highly
Emirates accounting
accounting nor nor taxable
taxable income.
income. Also
Also deferred
deferred tax tax liabilities
liabilities are
are notnot recognised
recognised ifif they they probable
probable forecast
forecast transaction
transaction (cash
(cash flow
flow hedge).
hedge). Fair
Fair values
values are
are obtained
obtained fromfrom quoted
quoted
Financial arise
arise from
from thethe initial
initial recognition
recognition of of goodwill
goodwill in in aa business
business combination.
combination. Deferred
Deferred income
income market
market prices
prices or
or dealer
dealer quotes
quotes forfor similar
similar instruments,
instruments, discounted
discounted cashcash flow
flow models
models andand
Commentary
tax
tax isis determined
determined using using taxtax rates
rates (and
(and laws)
laws) that
that have
have been
been enacted
enacted or or substantively
substantively option
option pricing
pricing models
models asas appropriate.
appropriate. All All derivatives
derivatives are are carried
carried asas assets
assets when
when the the fair
fair
dnata enacted
enacted in in the
the jurisdiction
jurisdiction of of the
the individual
individual companies
companies by by the
the endend ofof the
the reporting
reporting value
value isis positive
positive and
and as
as liabilities
liabilities when
when the
the fair
fair value
value isis negative.
negative.
Financial period
period and and areare expected
expected to to apply
apply when
when the the related
related deferred
deferred incomeincome tax tax liability
liability isis
Commentary
settled
settled or or the
the deferred
deferred income income taxtax asset
asset isis realised.
realised. dnata’s
dnata’s criteria
criteria to
to account
account for
for aa derivative
derivative financial
financial instrument
instrument as
as aa hedge
hedge include:
include:
Emirates
Consolidated  formal
formal documentation
documentation of of the
the hedging
hedging instruments,
instruments, hedged
hedged items,
items, hedging
hedging objective,
objective,
Financial
Deferred
Deferred income
income tax tax isis recognised
recognised onon temporary
temporary differences
differences arising
arising on
on investments
investments inin
Statements subsidiaries
subsidiaries andand associates,
associates, except
except where
where the the timing
timing of
of the
the reversal
reversal of
of the
the temporary
temporary strategy
strategy and
and basis
basis of
of measuring
measuring effectiveness
effectiveness all
all of
of which
which areare prepared
prepared prior
prior to
to
difference
difference isis controlled
controlled by by dnata
dnata and
and itit isis probable
probable that
that the
the temporary
temporary difference
difference will
will not
not applying
applying hedge
hedge accounting;
accounting; and
and
dnata  documentation
documentation showing
showing that
that the
the hedge
hedge effectiveness
effectiveness isis assessed
assessed onon anan ongoing
ongoing
Consolidated
reverse
reverse in
in the
the foreseeable
foreseeable future.
future.
Financial basis
basis and
and isis determined
determined toto have
have been
been highly
highly effective
effective in
in offsetting
offsetting the
the risk
risk of
of the
the
Statements Deferred
Deferred income
income tax tax assets
assets are
are recognised
recognised to
to the
the extent
extent that
that itit isis probable
probable that
that future
future hedged
hedged item
item throughout
throughout the
the reporting
reporting period.
period.
Additional
taxable
taxable profits
profits will
will be
be available
available against
against which
which the
the temporary
temporary differences
differences can can be
be utilised.
utilised.
Information Changes
Changes in in the
the fair
fair value
value of of derivatives
derivatives that
that are
are designated
designated and and qualify
qualify asas cash
cash flow
flow
Deferred
Deferred income
income taxtax assets
assets and
and liabilities
liabilities are
are offset
offset when
when there
there isis aa legally
legally enforceable
enforceable hedges
hedges and and thatthat prove
prove to to bebe highly
highly effective
effective in in relation
relation toto the
the hedged
hedged risk risk are
are
right
right to
to offset
offset current
current income
income tax tax assets
assets against
against current
current income
income tax tax liabilities
liabilities and
and when
when recognised
recognised in in other
other comprehensive
comprehensive income. income. When
When the the forecasted
forecasted transaction
transaction results
results in
in
the
the deferred
deferred income
income tax
tax assets
assets and
and liabilities
liabilities relate
relate to
to income
income taxes
taxes levied
levied byby the
the same
same the
the recognition
recognition of of aa non-financial
non-financial assetasset or
or aa non-financial
non-financial liability,
liability, the
the gains
gains andand losses
losses
taxation
taxation authority
authority onon either
either the
the same
same taxable
taxable entity
entity or
or different
different taxable
taxable entities
entities where
where previously
previously recognised
recognised in in other
other comprehensive
comprehensive income income are are re-classified
re-classified andand included
included in in
there
there isis an
an intention
intention to
to settle
settle the
the balances
balances on on aa net
net basis.
basis. the
the initial
initial carrying
carrying amount
amount of of the
the asset
asset or
or liability.
liability. These
These gains
gains and
and losses
losses are
are ultimately
ultimately
recognised
recognised in in the
the consolidated
consolidated income
income statement
statement in in the
the same
same period
period during
during which
which thethe
Trade
Trade payables
payables asset
asset or
or liability
liability affects
affects profit
profit or or loss.
loss. In
In all
all other
other cases,
cases, amounts
amounts previously
previously recognised
recognised
in
in other
other comprehensive
comprehensive income income are are transferred
transferred to to the
the consolidated
consolidated income
income statement
statement in in
Trade
Trade payables
payables are
are recognised
recognised initially
initially at
at fair
fair value
value and
and subsequently
subsequently measured
measured at
at the
the period
period during
during which
which thethe forecasted
forecasted transaction
transaction affects
affects the
the consolidated
consolidated income income
amortised
amortised cost
cost using
using the
the effective
effective interest
interest method.
method. statement
statement and and are
are presented
presented in in the
the same
same line
line item
item as as the
the gains
gains and
and losses
losses from
from hedged
hedged
items.
items.
Dividend
Dividend distribution
distribution

Dividend
Dividend distribution
distribution to
to equity
equity holders
holders isis recognised
recognised as
as aa liability
liability in
in the
the consolidated
consolidated
financial
financial statements
statements inin the
the period
period in
in which
which the
the dividends
dividends are
are approved.
approved.

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2. Summary of significant accounting policies (continued) Valuation of defined benefit obligations

Derivative financial instruments (continued)
When a cash flow hedging instrument expires or is sold, terminated or exercised, or
when a hedge no longer meets the criteria for hedge accounting under IAS 39, any
cumulative gain or loss existing in equity at that time is retained in equity and is
Overview
ultimately recognised in the consolidated income statement when the forecasted
Emirates transaction occurs. If a forecasted transaction is no longer expected to occur, the
cumulative gain or loss that was reported in equity is immediately transferred to
dnata
the consolidated income statement. The gain or loss on the ineffective portion is
Group recognised in the consolidated income statement.
The present value of the defined benefit obligations is determined on an actuarial basis
using various assumptions that may differ from actual developments in the future. These
assumptions include the determination of the discount rate and expected salary
increases which are reviewed at each reporting date. Due to the complexities involved in
the valuation and its long-term nature, defined benefit obligations are highly sensitive to
changes in these assumptions. A sensitivity analysis of changes in defined benefit
obligations due to a reasonably possible change in these assumptions are set out in
Note 19.
4. Fair value estimation

Financial Changes in the fair value of derivative instruments that do not qualify for hedge The levels of fair value hierarchy are defined as follows:
Information
accounting are recognised immediately in the consolidated income statement.
Emirates Level 1: Measurement is made by using quoted prices (unadjusted) from the active
Financial 3. Critical accounting estimates and judgements market.
Commentary
Level 2: Measurement is made by means of valuation methods with parameters
dnata In the preparation of the consolidated financial statements, a number of estimates and derived directly or indirectly from observable market data.
Financial associated assumptions have been made relating to the application of accounting Level 3: Measurement is made by means of valuation methods with parameters not
Commentary
policies and reported amounts of assets, liabilities, income and expenses. The estimates based exclusively on observable market data.
Emirates and associated assumptions are assessed on an ongoing basis and are based on
Consolidated historical experience and other factors, including expectations of future events that are Derivatives, contingent consideration and option liabilities are carried at fair value.
Financial
Statements believed to be reasonable under the circumstances. The following narrative addresses Derivatives fall into level 2 of the fair value hierarchy whereas contingent consideration
the accounting policies that require subjective and complex judgements, often as a result and option liabilities fall into level 3 of the fair value hierarchy.
dnata of the need to make estimates.
Consolidated
Financial Derivatives comprise forward exchange contracts. The forward exchange contracts are
Statements Valuation of intangible assets on acquisition fair valued using forward exchange rates that are quoted in an active market.
Additional
Information For each acquisition management assesses the fair value of intangible assets acquired. The fair values of contingent consideration and option liabilities are determined by using
Where an active market does not exist to value an intangible asset, fair values are valuation techniques based on entity specific estimates. These estimates are not based
established using valuation techniques e.g. discounting future cash flows expected from on observable market data and hence classified under level 3 of the fair value hierarchy.
the asset. In the process, estimates are made of the future cash flows, the useful life and
the discount rate based on management’s experience and expectation at the time of The changes in the fair value of level 3 instruments are set out in Note 17.
acquisition.

Impairment of goodwill / cash generating units

Determining whether goodwill is impaired requires an estimation of the value-in-use of

the cash generating units or group of cash generating units to which goodwill has been
allocated. The value-in-use calculation requires management to estimate the future cash
flows expected to arise from the cash generating unit and use a suitable discount rate in
order to calculate present value. The estimates made in arriving at the value-in-use
calculation are set out in Note 10.

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evenue 5. Revenue 7. Income tax expense 7. Income tax expense

2018 2017 2018 2017 2018 2017 2018 20
AED m AED m AED m AED m AED m AED m AED m AED
vices Services
The components of income tax
Theexpense
components
are: of income tax expense are:
rnational Airport Operations
International Airport Operations 3,803 3,328 3,803 3,328
Current income tax expense Current income tax expense 98 104 98 1
el Services
Overview Travel Services 3,384 3,136 3,384 3,136
Deferred income tax credit (Note
Deferred
24) income tax credit (Note 24) (61) (22) (61)
Airport Operations UAE Airport Operations 3,153 3,023 3,153 3,023
Emirates 37 82 37
ers Others 445 485 445 485
dnata 10,785 9,972 10,785 9,972
of Group
goods Sale of goods The income tax expense for the
The year
income
can tax
be expense
reconciled
fortothe year can be reconciled to
ght Catering Inflight Catering 1,991 1,861 1,991 1,861 the accounting profit before income
the accounting
tax as follows:
profit before income tax as follows:
Financial
ers Information Others 155 149 155 149
Profit before income tax Profit before income tax 1,389 1,333 1,389 1,3
2,146 2,010 2,146 2,010
Emirates
Financial 12,931 11,982 12,931 11,982
Commentary
Tax calculated at domestic tax
Taxrates
calculated
applicable
at domestic
to tax rates applicable to
perating
dnata costs 6. Operating costs profits in respective tax jurisdictions
profits in respective tax jurisdictions 74 78 74
Financial
Commentary 2018 2017 2018 2017 Effect of non-deductible expenses
Effect of non-deductible expenses (5) 5 (5)
AED m AED m AED m AED m Re-measurement of deferred Re-measurement
tax - effect of changes
of deferred
in tax tax - effect of changes in tax
Emirates
Consolidated rates rates (25) - (25)
loyee costs (see
Financial (a) below)
Employee costs (see (a) below) 5,055 4,654 5,055 4,654 Tax losses for which no deferred
Tax tax
losses
asset
foriswhich
recognised
no deferred tax asset- is recognised 1 -
Statements
ct costs Direct costs Effect of other items Effect of other items (7) (2) (7)
aveldnata
Services - Travel Services 2,135 1,913 2,135 1,913 Income tax expense Income tax expense 37 82 37
Consolidated
rport Operations
Financial - Airport Operations 1,293 1,138 1,293 1,138
Statements
flight Catering - Inflight Catering 843 794 843 794 The tax rates used for the reconciliation
The tax rates
above
usedare
for the
the rates
reconciliation
applicableabove
to theare
profits
the rates
in applicable to the profit
thers
Additional - Others 130 141 130 141 the respective tax jurisdictions.
the respective tax jurisdictions.
Information
al and lease expenses Rental and lease expenses 688 627 688 627
reciation and amortisation
Depreciation
(see (b) below)
and amortisation (see (b) below)
440 423 440 423
s and marketing expensesSales and marketing expenses 381 370 381 370
rmation technology infrastructure
Information
costs
technology infrastructure costs
210 204 210 204
porate overheads Corporate overheads 703 694 703 694
11,878 10,958 11,878 10,958

Employee costs include AED

(a) Employee
259 m (2017:
costsAED
include
253 AED
m) in259
respect
m (2017:
of retirement
AED 253 m) in respect of retirement
efit obligations (Note 19).benefit obligations (Note 19).
Depreciation and amortisation
(b) Depreciation
of AED 91 and
m (2017:
amortisation
AED 101ofm)AED
is included
91 m (2017:
under
AED 101 m) is included under
rmation technology infrastructure
information
costs.
technology infrastructure costs.

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8. Property, plant and equipment

Land,
buildings Office
and Plant equipment
leasehold and and Motor Capital
Overview property machinery furniture vehicles projects Total
Emirates AED m AED m AED m AED m AED m AED m
Cost
dnata
1 April 2016 912 1,679 1,568 112 90 4,361
Group Acquisitions 1 148 5 32 - 186
Financial
Additions 30 206 105 31 107 479
Information Transfer from capital projects 36 20 29 - (85) -
Emirates Disposals / write-offs (3) (40) (224) (8) (3) (278)
Financial Currency translation differences (16) (33) (23) (1) (6) (79)
Commentary
31 March 2017 960 1,980 1,460 166 103 4,669
dnata Accumulated depreciation
Financial
Commentary 1 April 2016 397 993 1,221 53 - 2,664
Acquisitions - 56 3 13 - 72
Emirates
Consolidated Charge for the year 53 151 131 19 - 354
Financial
Statements Disposals / write-offs (3) (42) (176) (6) - (227)
Currency translation differences (5) (16) (18) (2) - (41)
dnata
Consolidated 31 March 2017 442 1,142 1,161 77 - 2,822
Financial
Statements
Net book amount at
31 March 2017 518 838 299 89 103 1,847
Additional
Information

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8. Property, plant and equipment (continued)

Land,
buildings Office
and Plant equipment
leasehold and and Motor Capital
Overview property machinery furniture vehicles projects Total
Emirates AED m AED m AED m AED m AED m AED m
Cost
dnata
1 April 2017 960 1,980 1,460 166 103 4,669
Group Acquisitions (Note 33) - 1 - - - 1
Financial
Additions 52 160 62 17 43 334
Information Transfer from capital projects 65 24 21 - (110) -
Emirates Disposals / write-offs (6) (48) (147) (10) - (211)
Financial Currency translation differences 44 52 25 2 - 123
Commentary
31 March 2018 1,115 2,169 1,421 175 36 4,916
dnata Accumulated depreciation
Financial
Commentary 1 April 2017 442 1,142 1,161 77 - 2,822
Acquisitions (Note 33) - 1 - - - 1
Emirates
Consolidated Charge for the year 59 165 123 21 - 368
Financial
Statements Disposals / write-offs (6) (46) (142) (6) - (200)
Currency translation differences 16 26 22 - - 64
dnata
Consolidated 31 March 2018 511 1,288 1,164 92 - 3,055
Financial Net book amount at
Statements
31 March 2018 604 881 257 83 36 1,861
Additional
Information
The net book amount of property, plant and equipment includes AED 55 m (2017: AED 35 m) in respect of plant and machinery held under
finance leases, of which AED 26 m (2017: AED 11 m) was acquired during the year (Note 23).

The net book amount of plant and machinery includes an amount of AED 27 m (2017: Nil) in respect of assets provided as security against
term loans.

Land of AED 7 m (2017: AED 6 m) is carried at cost and is not depreciated.

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9. Investment property

Land Buildings Total

AED m AED m AED m
Cost
Acquisition 62 123 185
Overview
Additions - 73 73
Emirates 31 March 2017 62 196 258
dnata Accumulated depreciation
Acquisition - 14 14
Group
Charge for the year - 7 7
Financial 31 March 2017 - 21 21
Information
Net book amount at
Emirates
Financial
31 March 2017 62 175 237
Commentary Cost
dnata 1 April 2017 62 196 258
Financial
Commentary
Additions 37 74 111
31 March 2018 99 270 369
Emirates
Consolidated
Accumulated depreciation
Financial 1 April 2017 - 21 21
Statements
Charge for the year - 10 10
dnata
Consolidated
31 March 2018 - 31 31
Financial Net book amount at
Statements
31 March 2018 99 239 338
Additional
Information
Investment property is pledged as security against term loans (Note 22).

Investment property comprise of rental property in Dubai. The fair value of investment property as at 31 March 2018 is AED 461 m
(2017: AED 267 m), which was determined based on internal valuations as there is no active market for such properties. The fair value
has been computed by discounting the contractual future lease rental income at a discount rate of 6% (2017: 6%) commensurate to the
borrowing rate. These estimates are not based on observable market data and hence classified under level 3 of the fair value hierarchy.

Revenue from rental income earned during the year amounting to AED 23 m (2017: AED 15 m) is recognised in the consolidated income
statement as revenue from 'Services-Others'.

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10. Intangible assets

Computer Customer Contractual

Goodwill software Trade names relationships rights Total
AED m AED m AED m AED m AED m AED m
Cost

Overview
1 April 2016 1,707 464 127 200 658 3,156
Acquisitions 306 - - 293 - 599
Emirates
Additions - 55 - - - 55
dnata Disposals / write-offs - (28) - - - (28)
Others 10 - - (1) - 9
Group
Currency translation differences (114) (11) (17) (5) (45) (192)
Financial 31 March 2017 1,909 480 110 487 613 3,599
Information
Accumulated amortisation
Emirates 1 April 2016 - 310 28 63 467 868
Financial
Commentary Charge for the year - 51 12 46 54 163
Disposals / write off - (22) - - - (22)
dnata
Financial Currency translation differences - (7) (5) (3) (27) (42)
Commentary
31 March 2017 - 332 35 106 494 967
Emirates Net book value at 31 March 2017 1,909 148 75 381 119 2,632
Consolidated
Financial Cost
Statements 1 April 2017 1,909 480 110 487 613 3,599
dnata Acquisitions (Note 33) 9 - - 5 - 14
Consolidated
Additions - 92 - 16 - 108
Financial
Statements Disposals / write-offs - (2) - - - (2)

Additional
Others 15 3 - - - 18
Information Currency translation differences 132 15 14 13 47 221
31 March 2018 2,065 588 124 521 660 3,958
Accumulated amortisation
1 April 2017 - 332 35 106 494 967
Charge for the year - 52 11 48 42 153
Disposals / write-offs - (2) - - - (2)
Currency translation differences - 8 5 4 35 52
31 March 2018 - 390 51 158 571 1,170
Net book value at 31 March 2018 2,065 198 73 363 89 2,788

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10. Intangible assets (continued)

Computer software includes an amount of AED 40 m (2017: AED 18 m) in respect of projects under implementation.

The addition of AED 16 m to 'Customer relationships' arises from non-monetary consideration received against a dilution of an interest in a
subsidiary during the year.

Overview For the purpose of carrying out the impairment test of goodwill, the recoverable amounts for cash generating units or groups of cash
generating units have been determined on the basis of value-in-use calculations using cash flow forecasts approved by management
Emirates
covering a period of three years. Cash flows beyond such period have been extrapolated using terminal growth rates stated below. The key
dnata assumptions used in the value-in-use calculations include a risk adjusted pre-tax discount rate, gross margins consistent with historical
trends and growth rates based on management's expectations for market development. The long term growth rate does not exceed the
Group
long term average growth rate for the markets in which the cash generating units or groups of cash generating units operate. The goodwill
Financial allocated to cash generating units or groups of cash generating units and the key assumptions used in the value-in-use calculations are as
Information
follows:
Emirates Cash generating unit / Group Location Goodwill Discount Terminal
Financial
Commentary of cash generating units 2018 2017 rate growth rate
AED m AED m % %
dnata
Financial Airport operations USA 308 285 10.0 2.0
Commentary
Airport operations Switzerland 260 250 6.0 1.5
Emirates Airport operations Singapore 95 89 7.0 3.0
Consolidated
Financial
Airport operations Netherlands 65 57 8.5 1.5
Statements Airport operations Brazil 49 49 16.0 2.5
dnata Airport operations Australia 28 28 10.0 2.5
Consolidated Airport operations Czech Republic 22 19 8.5 1.5
Financial
Statements Inflight catering group UK 505 478 9.0 1.5
Online travel services UK 481 423 9.0 1.5
Additional
Information Travel services UK 183 162 9.0 1.5
Travel services UAE 3 3 - -
Others UAE 66 66 12.0 1.0
2,065 1,909

Goodwill pertaining to Airport Operations, USA includes AED 300 m (2017: AED 285 m) for Ground Services International Inc / Metro Air
Service Inc. and AED 8 m (2017: Nil ) for ALX Cargo Centre IAH LLC. The key assumptions used in the value-in-use calculations for both
these cash generating units are similar.
Goodwill pertaining to Travel services, UK includes AED 130 m (2017: AED 115 m) for the Gold Medal group (Gold Medal Travel Group plc
and Airline Network plc) and AED 53 m (2017: AED 47 m) for the Stella Travel group (Stella Travel Services (UK) Ltd and Stella Global UK
Ltd). The key assumptions used in the value-in-use calculations for both these groups of cash generating units are similar.

The recoverable value of cash generating units or group of cash generating units would not fall below their carrying amount with a 5%
reduction in the gross margin, a 1% reduction in the terminal growth rate or a 1% increase in the discount rate.

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11. Investments in subsidiaries, associates and joint ventures

Principal subsidiaries
Percentage Country of
of equity incorporation
owned Principal activities and principal operations
Overview dnata Travel (UK) Limited 100 Travel agency United Kingdom
dnata Inc. 100 Ground handling services Philippines
Emirates
Dnata International Airport Services Pte Ltd 100 Holding company Singapore
dnata Ground, cargo handling and catering
dnata Singapore Pte Ltd 100 services Singapore
Group
Maritime and Mercantile International Travel LLC 100 Travel agency United Arab Emirates
Financial Dnata Switzerland AG 100 Ground and cargo handling services Switzerland
Information
dnata Travel & Tourism WLL 100 Travel agency Bahrain
Emirates Cleopatra International Travel WLL 100 Travel agency Bahrain
Financial
Commentary
Dnata Aviation Services Ltd 100 Holding company United Kingdom
dnata Limited 100 Ground and cargo handling services United Kingdom
dnata Dnata for Airport Services Ltd 80 Ground and cargo handling services Iraq
Financial
Commentary Dnata Catering Services Limited 100 Holding company United Kingdom
Alpha Flight Services Pty Ltd 100 Inflight catering services Australia
Emirates dnata Catering Ireland Ltd 100 Inflight catering services Ireland
Consolidated
Financial Alpha Flight a.s 80 Inflight catering services Czech Republic
Statements Alpha In-Flight US LLC 100 Inflight catering services United States of America
dnata dnata srl 100 Inflight catering services Italy
Consolidated dnata Catering s.r.l. 64.2 Inflight catering services Romania
Financial
Statements Alpha Flight Services UAE LLC (see (a) below) 49 Inflight catering services United Arab Emirates
Jordan Flight Catering Company Ltd (see (a) below) 35.9 Inflight catering services Jordan
Additional dnata International Pvt Ltd 100 Travel agency India
Information
dnata World Travel Limited 100 Holding company United Kingdom
Travel Republic Limited 100 Online travel services United Kingdom
Airline Cleaning Services Pty Ltd 100 Aircraft cleaning services Australia
En Route International Limited 100 Bakery and food solutions United Kingdom
Najm Travel LLC 100 Travel agency United Arab Emirates
dnata Travel Holdings UK Limited 100 Holding company United Kingdom
Gold Medal Travel Group plc 100 Travel agency United Kingdom
Airline Network plc 100 Travel agency United Kingdom
dnata Travel Inc 100 Travel services Philippines
Travel Partners LLC 100 Travel services United Arab Emirates
Stella Travel Services (UK) Limited 100 Holding company United Kingdom
Stella Global UK Limited 100 Holding company United Kingdom
Travel 2 Limited 100 Travel agency United Kingdom

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11. Investments in subsidiaries, associates and joint ventures (continued)

Principal subsidiaries (continued)

Percentage Country of
of equity incorporation
owned Principal activities and principal operations
Overview
Travelbag Limited 100 Travel agency United Kingdom
The Global Travel Group Limited 100 Travel agency United Kingdom
Emirates Sunmaster Limited 100 Travel agency United Kingdom
dnata Airport Services Pty Ltd 100 Ground and cargo handling services Australia
dnata
dnata BV 100 Ground and cargo handling services The Netherlands
Group RM Services Auxilliares de Transporte Aero S/A 70 Ground handling services Brazil
Plafond Fit Out LLC 100 MEP contracting United Arab Emirates
Financial
Information Airport Handling SpA (see (a) below) 30 Ground handling services Italy
dnata Aviation Services US Inc. 100 Holding company United States of America
Emirates
Financial Incorporated during the year:
Commentary
Dnata Catering Canada Limited 100 Inflight catering services Canada
dnata Travel Partners Iberian, Sociedad Limitada 100 Travel services Spain
Financial
Commentary
dnata Aviation USA Inc. 100 Holding company United States of America
Incorporated during the previous year:
Emirates
dnata Aviation Services Canada Ltd 100 Holding company Canada
Consolidated
Financial dnata Pty Ltd 100 Holding company Australia
Statements
Airport Handling Services Australia Pty Ltd 100 Ground handling services Australia
dnata Travel Partners (London) Limited 100 Travel services United Kingdom
Consolidated
Financial Acquired during the year:
Statements Destination Asia (Singapore) Pte Ltd 100 Travel services Singapore
Additional
ALX Cargo Centre IAH LLC 100 Cargo handling services United States of America
Information Acquired during the previous year:
Transecure LLC 100 Investment property United Arab Emirates
Ground Services International Inc. 100 Ground handling services United States of America
Metro Air Service Inc. 100 Mail handling services United States of America
Air Dispatch (CLC) s.r.o 95 Load control services Czech Republic
Air Dispatch (CLC) Spolka z.o.o 95 Load control services Poland
Oman United Agencies Travel LLC 76.9 Travel agency Oman
Sama Travel and Services International LLC 76.9 Travel agency Oman
Moon Travel LLC (see (a) below) 38 Travel agency Oman

(a) Alpha Flight Services UAE LLC, Jordan Flight Catering Company Ltd, Airport Handling SpA and Moon Travel LLC qualify as
subsidiaries as overall control is exercised by dnata, therefore the results of these companies are consolidated.

None of the subsidiaries have non-controlling interests that are material to dnata.

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11. Investments in subsidiaries, associates and joint ventures (continued)

Percentage Country of
of equity incorporation
owned Principal activities and principal operations
Principal associates
Dubai Express LLC 50 Freight clearing and forwarding United Arab Emirates
Overview
Gerry's Dnata (Private) Ltd 50 Ground and cargo handling services Pakistan
Emirates Guangzhou Baiyun International Airport Ground
Handling Services Co. Ltd 20 Aircraft handling services P. R. China
dnata
Canary Topco Ltd 9.1 Information technology services United Kingdom
Group Principal joint ventures
Financial Super Bus Tourism LLC (see (b) below) 75 Travel services United Arab Emirates
Information dnata Travel Company Limited (see (b) below) 70 Travel agency Saudi Arabia
Travel Counsellors LLC (see (c) below) 51 Travel agency United Arab Emirates
Emirates
Financial Dnata-PWC Airport Logistics LLC 50 Freight clearing and forwarding United Arab Emirates
Commentary Transguard Group LLC 50 Security services United Arab Emirates
dnata Dunya Travel LLC 50 Travel agency United Arab Emirates
Financial Najm Travels LLC 50 Travel agency Afghanistan
Commentary
Al Tawfeeq Travel (Dnata Travel) WLL 50 Travel agency Qatar
Emirates dnata Newrest (Pty) Ltd 50 In-flight catering services South Africa
Consolidated
Financial Alpha LSG Ltd 50 In-flight catering services United Kingdom
Statements Bollore Logistics LLC (formerly SDV UAE LLC)
dnata (see (b) below) 25.5 Freight clearing and forwarding United Arab Emirates
Consolidated Imagine Enterprises Limited (see (b) below) 51 Travel agency United Kingdom
Financial
Statements Acquired during the year:
Destination Asia Group (see (d) below) 51 Travel services Asia Pacific
Additional
Acquired during the previous year:
Information
G.T.A. Dnata Ground Handling Limited 50 Aircraft handling services Canada
G.T.A. Dnata World Cargo Limited 50 Cargo handling services Canada
Incorporated during the previous year:
G Travel International LLC (see (c) below) 51 Travel services United Arab Emirates

(b) Although the percentage of equity owned in Super Bus Tourism LLC, dnata Travel Company Limited, Bollore Logistics LLC (formerly
SDV UAE LLC) and Imagine Enterprises Limited is 75%, 70%, 25.5% and 51% respectively, they are subject to joint control.
(c) dnata's beneficial interest in Travel Counsellors LLC and G Travel International LLC is 50% and they are subject to joint control.
(d) During the year dnata acquired 25% beneficial interest in a number of entities forming part of Destination Asia Group operating in 9
countries in the Asia Pacific region.

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nvestments in subsidiaries,
11. Investments
associates and
in subsidiaries,
joint ventures
associates
(continued)
and joint ventures (continued) No individual associate is material
No individual
to dnata.
associate
The aggregate
is materialfinancial
to dnata.
information
The aggregate
of financial informati
associates is set out below: associates is set out below:
vement of investments accounted
Movementfor
of investments
using the equity
accounted
method
for using the equity method
2018 2017 2018 2017 2018 2017 2018
AED m AED m AED m AED m AED m AED m AED m A

nceOverview
brought forward Balance brought forward 407 385 407 385 Share of results of associates Share of results of associates 32 (1) 32
itions Additions 8 28 8 28 Share of other comprehensive
Share
income
of other
of associates
comprehensive income of associates
52 (21) 52
Emirates
e of results Share of results 126 78 126 78 Share of total comprehensive
Share
income
of total
of associates
comprehensive income of 84
associates (22) 84
e ofdnata
other comprehensive
Share
income
of other comprehensive income 49 (22) 49 (22)
e ofGroup
other equity movements
Share of other equity movements 3 1 3 1 Aggregate carrying value ofAggregate
investments
carrying
in associates
value of investments57
in associates21 57
dends Dividends (89) (28) (89) (28)
Financial No individual joint venture isNo
material
individual
to dnata.
joint venture
The aggregate
is material
financial
to dnata.
information
The aggregate
of financial informati
ecognition
Informationdue to change
De-recognition
in ownership due to change in ownership
joint ventures is set out below:
joint ventures is set out below:
est (see below) interest (see below) - (16) - (16)
Emirates
ency translation
Financial differences
Currency translation differences 15 (19) 15 (19) 2018 2017 2018
Commentary
assification to Asset heldReclassification
for sale (see below)
to Asset held for sale (see below)
(46) - (46) - AED m AED m AED m A
ncednata
carried forward Balance carried forward 473 407 473 407
Financial Share of results of joint ventures
Share of results of joint ventures 94 79 94
Commentary
Share of other comprehensive
Share
income
of other
of a joint
comprehensive
venture income of a joint
(3) venture (1) (3)
assification to Asset heldReclassification
for sale to Asset held for sale
Emirates
ebruary 2018, dnata received
In February
an offer
2018,
fromdnata
Global
received
Business
anTravel
offer from
Holdings
Global
Limited
Business Travel Holdings Limited Share of total comprehensive
Share
income
of total
of joint
comprehensive
ventures income of 91
joint ventures
78 91
Consolidated
T") Financial
to buy all the shares("GBT")
of one to
of buy
its associate,
all the shares
HoggofRobinson
one of itsGroup
associate,
(“HRG”)
Hogg
plc Robinson Group (“HRG”) plc
Statements
cash as part of the GBT acquisition
for cash as of
part
HRG
of the
Plc ("the
GBT acquisition
Scheme"). dnata
of HRGhas
Plcprovided
("the Scheme"). dnata has provided Aggregate carrying value ofAggregate
investments
carrying
in value of investments in
ocable
dnataundertaking to vote
irrevocable
in favorundertaking
of the scheme to vote
provided
in favor
certain
of the
conditions
scheme are
provided certain conditions are joint ventures joint ventures 416 386 416
Consolidated
The transaction is expected
Financial met. to
Thecomplete
transaction
within
is expected
the secondto quarter
completeof within
financial
theyear
second quarter of financial year
Statements
8-19 subject to regulatory
2018-19
and competition
subject to commission
regulatory and
clearance.
competition
Accordingly,
commission
the clearance. Accordingly, the
stment in HRG is classified
Additional investment
as an asset
in held
HRGfor
is classified
sale. as an asset held for sale.
Information
nge in the ownership interest
Changeofina the
joint
ownership
venture during
interest
theofprevious
a joint venture
year during the previous year
ng the previous year, dnata
During
acquired
the previous
the remaining
year, dnata
50% acquired
interest in
thea remaining
joint venture,
50% interest in a joint venture,
secure LLC, to increase Transecure
its shareholding
LLC, totoincrease
a 100% its
interest (Note 33).
shareholding to aThe stepinterest (Note 33). The step
100%
uisition did not result in any significant
acquisition didfair
notvalue
resultgain or loss.
in any significant fair value gain or loss.
ng the previous year, dnata acquired
During an additional
the previous 26.9%acquired
year, dnata interest an
in additional
the associate,
26.9% interest in the associate,
an United Agencies TravelOman
LLC, to increase
United its shareholding
Agencies Travel LLC, to
to aincrease
76.9% interest (Note
its shareholding to a 76.9% interest (Note
The retained interest in 33).
the associate at the
The retained acquisition
interest in thedate was remeasured
associate to fair date was remeasured to fair
at the acquisition
e resulting in a net gain of AEDresulting
value 7 m. in a net gain of AED 7 m.
resultant gain is includedThe
under other gain
resultant operating income
is included in the
under consolidated
other operatingincome
income in the consolidated income
ement. statement.

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 THE EMIRATES GROUP
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Advance lease rentals 12. Advance lease rentals The impairment

The impairment charge on trade receivables charge on trade
recognised in the receivables recognised
consolidated income in the consolidated in
statement
statement during the year mainly during
relates the year
to travel mainly
agency, relates
airline and to travel
other agency, airline and other custo
customers
2018 2017 2018 2017
who are
who are in unexpected difficult in unexpected
economic situationsdifficult
and areeconomic situations
unable to and are unable to meet
meet their
AED m AED m AED m AED m
obligations. This charge is obligations.
included in This chargecosts.
operating is included in charged
Amounts operatingtocosts.
the Amounts charged to
nce brought forward Balance brought forward 42 22 42 22 provision account are written provision
off when account areexpectation
there is no written off when thererecovery.
of further is no expectation of further recovery.
uisition Acquisition - 19 - 19
Overview
Additions during the year 6 6 Movements
Movements in the provision for in the
impairment provision
of trade for impairment
receivables of trade receivables are as follows:
are as follows:
tions during the year 6 6
ge for the year
Emirates Charge for the year (3) (3) (3) (3)
2018 2017 2018
encydnata Currency translation differences
translation differences 1 (2) 1 (2) AED m A
AED m AED m
nce carried forward Balance carried forward 46 42 46 42
Group
Advance to
ance lease rentals will be charged lease
the rentals will be charged to the consolidated
consolidated Balance brought forward Balance brought forward 55 38 55

statement as follows: income statement as follows:

me Financial Acquisition Acquisition - 1 -
Information
hin one year (Note 14) Within one year (Note 14) 3 3 2 Charge for the year Charge for the year 95 50 95
2
Emirates
r one year Over one year 43 43 40 Unused amounts reversed Unused amounts reversed (9) (22) (9)
Financial 40
Commentary Amounts written off as uncollectible
Amounts written off as uncollectible (16) (9) (16)
nventories 13. Inventories
Transfer Transfer - (1) -
dnata
Financial 2018 2017 Currency translation differences
Currency translation differences 4 (2) 4
Commentary
2018 2017
AED m AED m AED m AED m Balance carried forward Balance carried forward 129 55 129
Emirates
Consolidated
d and beverage Food and beverage 45 42 45 42 The other classes of trade andThe other
other classes ofdo
receivables trade
not and other
contain receivables
impaired do not contain impaired assets.
assets.
Financial
es and consumables
Statements Spares and consumables 31 27 31 27 The maximum
The maximum exposure to credit exposure
risk of current tradetoand
credit riskreceivables
other of current (excluding
trade and other receivables (excl
r Other 11 18 11 18 prepayments) at the reporting date is the carrying
prepayments) at the reporting date is the carrying value of each class of receivable value of each class of rece
dnata
Consolidated 87 87 87 87 mentioned above. mentioned above.
Financial
Statements
14. Trade and other receivables
Trade and other receivables Thethat
The ageing of trade receivables ageing of trade
are past due receivables that are
but not impaired past
is as due but not impaired is as follows:
follows:
Additional
Information 2018 2017 2018 2017 2018 2017 2018
AED m AED m AED m AED m AED m AED m AED m A
Below 3 months Below 3 months 883 704 883
Trade receivables - net of provision
e receivables - net of provision 1,950 1,696 1,950 1,696
3-6 months 3-6 months 118 73 118
Deposits
osits and other receivables and other receivables 661 588 661 588
Above 6 months Above 6 months 230 234 230
ayments Prepayments 529 485 529 485
1,231 1,011 1,231 1
ted parties (Note 31) Related parties (Note 31) 484 556 484 556
Advance lease rentals (Note 12)
ance lease rentals (Note 12) 3 2 3 2 Formanagement,
For further details on credit risk further detailsrefer
on credit
to Note management, refer to Note 32.
risk32.
3,627 3,327 3,627 3,327
Less: Receivables over one year
Receivables over one year (134) (147) (134) (147)
3,493 3,180 3,493 3,180

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Capital 15. Capital 17. Trade and other payables

17. Trade and other payables
tal represents the permanent capital
Capital of dnata.
represents the permanent capital of dnata. 2018 2017 2018
AED m AED m AED m A
Other reserves 16. Other reserves
Trade payables and accruals Trade payables and accruals 2,758 2,357 2,758 2
Translation Translation
Overview Deferred revenue Deferred revenue 793 734 793
reserve Other Total
reserve Other Total
Employee leave pay Employee leave pay 236 227 236
Emirates AED m AED m AED
AEDmm AED m AED m
Related parties (Note 31) Related parties (Note 31) 102 77 102
ril 2016 1 April 2016 (233) 17 (216)
(233) 17 (216)
dnata Customer deposits Customer deposits 52 55 52
ency translation differences (158)
Currency translation differences - (158)
(158) - (158)
Group Dividend payable Dividend payable 1,000 9 1,000
nvestment hedge (Note 22) 4
Net investment hedge (Note 22) - 44 - 4
Other payables Other payables 70 85 70
flow hedges
Financial Cash flow hedges - (33) (33)- (33) (33)
Information 5,011 3,544 5,011 3
sferred to consolidated income statement - 25
Transferred to consolidated income statement 25- 25 25
Less: Payables over one year Less: Payables over one year (163) (193) (163)
e of other comprehensive
Emirates income of
Share of other comprehensive income of
Financial 4,848 3,351 4,848 3
stments accounted for using
Commentary
the equity
investments accounted for using the equity
hod, net of deferred tax method, net of deferred tax 21 - 2121 - 21 The payables over one year represent the non-current
The payables portion
over one year of the
represent acquisition
the related
non-current portion of the acquisition re
dnata
ognised in other comprehensive income (133) (8) (141) deferred / contingent consideration
deferred and the fair value
/ contingent of options
consideration andissued to acquire
the fair value of options issued to ac
Financial Recognised in other comprehensive income (133) (8) (141)
sferCommentary
from retained earnings - additional interests in subsidiaries. It also
additional includes
interests the non-current
in subsidiaries. It alsoportion of the
includes the non-current portion o
Transfer from retained earnings 2 2- 2 2
March 2017 (366) 11 (355) deferred revenue. deferred revenue.
Emirates 31 March 2017 (366) 11 (355)
Consolidated
encyFinancial
translation differences 204
Currency translation differences - 204
204 - 204 The movements in fair valuesThe of contingent
movementsconsideration
in fair values and options toconsideration
of contingent acquire non- and options to acquire
Statementshedge (Note 22)
nvestment Net investment hedge (Note(9)
22) - (9)(9) - (9) controlling interests are as follows:
controlling interests are as follows:
flow hedges
dnata Cash flow hedges - 1 1- 1 1 2018 2017
Consolidated
2018
sferred to consolidated income statement
Transferred -
to consolidated income (8)
statement (8)- (8) (8) AED m AED m
Financial AED m A
e Statements
of other comprehensive
Share income of comprehensive income of
of other
stments accounted for using the equity Balance brought forward Balance brought forward 13 54 13
Additional investments accounted for using the equity
hod,Information
net of deferred tax method, net of deferred tax 7 - 77 Payments Payments (13) (17) (13)
- 7
ognised in other comprehensive income 202 (7) 195 Remeasurement gain Remeasurement gain - (18) -
Recognised in other comprehensive income 202 (7) 195
e of other equity Share movement of Currency translation differences
Currency translation differences - (6) -
of other equity movement of
stments accounted for using the equity Balance carried forward Balance carried forward - 13 -
investments accounted for using the equity
hod method - 3 3- 3 3 The remeasurement gain in the
Theprevious year represents
remeasurement a decrease
gain in the previousinyear
the represents
contingenta decrease in the contin
March 2018 31 March 2018 (164) 7 (157)
(164) 7 (157) consideration payable. This gain is recognised in the consolidated income instatement
consideration payable. This gain is recognised the consolidated income state
under other operating income.
under other operating income.
translation reserve includes
Thea translation
loss of AEDreserve
39 m pertaining
includes atoloss
an of
investment
AED 39 minpertaining
an to an investment in an
ciate which has been reclassified
associateaswhich
Asset has
heldbeen
for sale as at 31 as
reclassified March
Asset2018
held(Note
for sale as at 31 March 2018 (Note
11).

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 THE EMIRATES GROUP
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rovisions 18. Provisions Funded schemes Funded schemes

a) Parent company a) Parent company

2018 2017 2018 2017
AED m AED m AED m AED m Senior employees based in theSenior employeesin
UAE participate based in thebenefit
a defined UAE participate
providentinscheme
a defined
to benefit provident schem
which dnata contributes a specified percentage
which dnata contributes a specified percentage of basic salary based upon the of basic salary based upon
current Non-current
employee’s
employee’s grade and duration grade
of service. and duration
Amounts of service.
contributed Amounts
are invested in contributed
a are invested
ement benefit obligationsRetirement
Overview (Note 19) benefit obligations (Note 19)549 523 549 523
trustee administered scheme and accumulate along with
trustee administered scheme and accumulate along with returns earned on investments. returns earned on investm
r provisions (Note 20) Other provisions (Note 20) 13 24 13 24
Emirates Contributions are made on aContributions
monthly basisare made on of
irrespective a monthly basis irrespective
fund performance and areof fund performance and
562 547 562 547
not pooled, but are separately identifiable and attributable to each participant. The fund to each participant. The
not pooled, but are separately identifiable and attributable
ent dnata Current
comprises funds
comprises a diverse mix of managed a diverse
and mix of managed
investment funds
decisions areand investment decisions are contr
controlled
r provisions (Note 20) Other provisions (Note 20) 47 45 47 45
Group directly
directly by the participating employees.by the participating employees.
47 45 47 45
Financial
Information 609 592 609 592 Benefits receivable under theBenefits receivable
provident scheme under the provident
are subject to vestingscheme are subject
rules, which are to vesting rules, whic
etirement 19. Retirement benefit obligations
Emirates benefit obligations
dependent upon a participating employee's length of service. If at the time an employee If at the time an empl
dependent upon a participating employee's length of service.
Financial leaves employment,
leaves employment, the accumulated the accumulated
vested amount, vested amount,
including investment returns including
is investment retur
cordance In accordance
with the provisions
Commentary of IAS 19, with the provisions
management of IAS out
has carried 19, management
an exercise tohas carried out an exercise to less than the end of service benefits that would have
less than the end of service benefits that would have been payable to that employee been payable to that empl
s the present value of itsassess the
defined present
benefit value of its
obligations at defined
31 Marchbenefit
2018 obligations
in respect ofat 31 March 2018 in respect of under dnata
relevant local
dnata under relevant local regulations, pays the regulations, dnata directly
shortfall amount pays thetoshortfall
the amount directly to
oyees' end of service employees'
Financial end ofunder
benefits payable service benefits
relevant payable
local under and
regulations relevant local regulations and
employee. However, if the accumulated vested amount exceeds the end of se
Commentary employee. However, if the accumulated vested amount exceeds the end of service
actual arrangements. contractual arrangements.
benefits that would have beenbenefits
payablethat would
to an have been
employee underpayable
relevanttolocal
an employee under relevant local regulat
regulations,
Emirates
abilities recognised
Consolidated The
in the liabilities recognised
consolidated statementinofthe consolidated
financial positionstatement
are: of financial position are: the employee receives either seventy five or one hundred percent of their fund balance percent of their fund ba
the employee receives either seventy five or one hundred
Financial
depending on their length ofdepending on their
service. Vested length
assets of scheme
of the service. Vested
are not assets of the
available to scheme are not availab
Statements 2018 2017 2018 2017
dnata or its
dnata or its creditors in any circumstances. creditors in any circumstances.
AED m AED m AED m AED m
dnata
ed Consolidated
schemes
Financial
Funded schemes Theand
The present value of obligations present valueofofplan
fair value obligations and
assets are asfair value of plan assets are as follows:
follows:
Statements
nt value Present
of defined benefit value of defined benefit obligations
obligations 731 648 731 648
2018 2017 2018 2
value of plan assets Less: Fair value of plan assets
FairAdditional (661) (581) (661) (581)
AED m AED m AED m AE
Information 70 67 70 67
Unfunded schemes Present value of funded defined Present value
benefit of funded defined benefit obligations
obligations 139 129 139
nded schemes
Present
nt value of defined benefit value of defined benefit obligations
obligations 479 456 479 456 Less: Fair value of plan assets Less: Fair value of plan assets (139) (128) (139)
- 1 -

Liability statement
lity recognised in consolidated recognisedofin consolidated statement of
The assessment of the present The assessment
value of the
of defined present
benefit value ofassumed
obligations defined expected
benefit obligations assumed expe
cial position financial position 549 523 549 523
salary increases averaging 3.0% (2017: 3.0%) and a discount
salary increases averaging 3.0% (2017: 3.0%) and a discount rate of 4.00% (2017: 4.25%) rate of 4.00% (2017: 4.
The as
above liability is presented as a non-current provision within the consolidated per annum. The present valuesper
of annum. The present
the defined values of the
benefit obligations at defined
31 March benefit
2018 obligations
were at 31 March 2018
above liability is presented a non-current provision within the consolidated
computed using the actuarial
computed using the actuarial assumptions set out above. assumptions set out above.
ment of financial position as dnata expects to settle this liability over a long term this liability over a long term
statement of financial position as dnata expects to settle
d. period.

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 THE EMIRATES GROUP
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2017-18

Retirement benefit obligations (continued)

19. Retirement benefit obligations (continued) The movement in the presentThe
value of definedinbenefit obligations ofdefined
the Swiss plan is:
movement the present value of benefit obligations of the Swiss plan
liability of AED 1 m in the
Theprevious year
liability of AEDrepresents theprevious
1 m in the amount year
that will not be the amount that will not be
represents
ed from plan assets andsettled
is calculated as the excess 2018 2017 2018
from plan assets and ofis the presentasvalue
calculated of the of the present value of the
the excess
AED m AED m AED m A
ned benefit obligation for an individual
defined employee for
benefit obligation overan the fair value
individual of the over the fair value of the
employee
oyee's plan assets at the employee's
end of the reporting period.
plan assets at the end of the reporting period. Balance brought forward 238 231
Balance brought forward 238
Overviewreceived Service cost Service cost 14 13 14
ributions include the transferreceived
Contributions of accumulated benefits
include the from
transfer of unfunded
accumulated benefits from unfunded
mes. Interest cost Interest cost 2 2 2
Emirates schemes.
Remeasurement loss Remeasurement loss 1 1 1
arial gains and losses andActuarial
expected returns
gains and on planand
losses assets are notreturns
expected calculated given
on plan assets are not calculated given
dnata
investment decisions relating Employee contributions Employee contributions 8 8 8
that investment decisions relating to plan assets areofunder the direct control of
to plan assets are under the direct control
Group employees.
cipating Benefits paid Benefits paid (9) (10) (9)
participating employees.
Currency translation differences
Currency translation differences 10 (7) 10
movement
Financial in the fair value of the plan assets is:
The movement in the fair value of the plan assets is:
Information Balance carried forward Balance carried forward 264 238 264
2018 2017 2018 2017
Emirates
AED m AED m AED m AED m The movement in the fair value ofmovement
the plan assets
Financial
Commentary
The in theoffair
thevalue
Swissofplan
the is:
plan assets of the Swiss plan is:
nce brought forward Balance brought forward 128 118 128 118
dnata 2018 2017 2018
ributions
Financialreceived Contributions received 18 18 18 18 AED m AED m AED m A
nge Commentary
in fair value Change in fair value 14 7 14 7
fitsEmirates
paid (21) (15) Balance brought forward Balance brought forward 184 179 184
Benefits paid (21) (15)
Consolidated
nceFinancial
carried forward 139 128 Expected return on plan assetsExpected return on plan assets 1 1 1
Balance carried forward 139 128
Statements Employer contributions Employer contributions 11 10 11
ubsidiaries
dnata Employee contributions Employee contributions 8 8 8
Consolidated
b) Subsidiaries
Benefits paid Benefits paid (9) (10) (9)
wissFinancial
plan (i) Swiss plan
Statements Currency translation differences
Currency translation differences 8 (4) 8
oyees of a subsidiary in Switzerland
Employees ofparticipate in ain
a subsidiary defined benefit
Switzerland plan ("theinSwiss
participate a defined benefit plan ("the Swiss Remeasurement
Additional Remeasurement
"). The Swiss plan
Information is funded by way
plan"). TheofSwiss
contribution to an insurance
plan is funded by way ofpolicy.
contribution to an insurance policy. - Return on plan assets 5 -
- Return on plan assets 5
Balance carried forward Balance carried forward 208 184 208
present value of obligations
Theand fair value
present valueofofplan assets are
obligations andasfair
follows:
value of plan assets are as follows:
2018 2017 2018 2017
AED m AED m AED m AED m
ent value of funded defined benefit
Present obligations
value 264
of funded defined benefit obligations 238 264 238
Fair value of plan assets Less: Fair value of plan assets (208) (184) (208) (184)
56 54 56 54

actuarial valuation for theThe

Swiss plan included
actuarial valuationassumptions
for the Swissrelating to the discount
plan included assumptions relating to the discount
of 0.7% (2017: 0.7%) and rate
expected salary increases of 1.0% (2017: 1.0%) per annum.
of 0.7% (2017: 0.7%) and expected salary increases of 1.0% (2017: 1.0%) per annum.

167
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19. Retirement
Retirement benefit obligations benefit obligations (continued)
(continued) The
The movement in the fair value ofmovement in theoffair
the plan assets thevalue of the plan
Netherlands planassets
is: of the Netherlands plan is:

(ii) Netherlands plan 2018 2017 2018

Netherlands plan
AED m AED m AED m A
loyees of a subsidiary inEmployees of aparticipate
Netherlands subsidiaryinina Netherlands participate
defined benefit in a defined benefit plan ("the
plan ("the
Netherlands plan"). The Netherlands plan is funded Balance brought forward Balance brought forward 269 251 269
herlands plan"). The Netherlands plan is funded by way of contribution to by
an way of contribution to an
insurance policy. Expected return on plan assets
Expected return on plan assets 5 7 5
rance policy.
Overview Remeasurement Remeasurement
Theand
present value of obligations present valueof
fair value ofplan
obligations andasfair
assets are value of plan assets are as follows:
follows: - Return on plan assets (2)
- Return on plan assets (2) 22
Emirates Employer contributions 4
2018 2017 2018 2017 Employer contributions 4 4
dnata AED m AED m Employee contributions Employee contributions 2 2 2
AED m AED m
Benefits paid Benefits paid (4) (4) (4)
ent Group
value of funded definedPresent value
benefit of funded defined benefit obligations
obligations 328 281 328 281
Currency translation differences
Currency translation differences 40 (13) 40
Fair value of plan assets Less: Fair value of plan assets (314) (269) (314) (269)
Financial Balance carried forward 314
Information 14 12 Balance carried forward 314 269
14 12
Emirates
dnata expects to contribute,dnata expectsof toexisting
in respect contribute,
plan in respect of
members of all
existing plan members of all its fu
its funded
actuarial The actuarial valuation for the Netherlands plan included assumptions relating to the
Financialvaluation for the Netherlands plan included assumptions relating to the schemes, approximately AED schemes, approximately
35 m during the year endingAED 31
35 March
m during the year ending 31 March 2019.
2019.
ountCommentary discount
rate of 1.9% (2017: 1.85%) rate
and of 1.9% salary
expected (2017:increases
1.85%) and expected
of 1% (2017: salary
1%) perincreases of 1% (2017: 1%) per
Unfunded schemes Unfunded schemes
um. dnata annum.
Financial The movement in the present value of of
defined benefit obligations of the Netherlands End of service
End of service benefits for employees benefits
who do for employees
not participate in thewho do notscheme,
provident participate in the provident sch
movement
Commentary
in the present value of defined benefit obligations the Netherlands
plan is: defineddefined
defined benefit plans or other benefitcontribution
plans or other
plans defined contribution
follow relevant local plans follow relevant
is:
Emirates regulations, which are mainly regulations,
based on which areofmainly
periods basedservice
cumulative on periods of cumulative
and levels of service and leve
Consolidated 2018 2017 2018 2017
Financial AED m AED m AED m AED m employees’ final basic salary.employees’
The liabilityfinal basic salary.
recognised in theThe liability recognised
consolidated in of
statement the consolidated stateme
Statements financial
financial position is the present position
value of is the benefit
the defined presentobligation
value of the
at defined
the end benefit
of the obligation at the end o
ncednata
brought forward Balance brought forward 281 261 281 261 reporting period.
reporting period.
Consolidated Service cost 5 5 the present value of
ice cost
Financial
5 5 The movement in the presentThe movement
value in benefit
of defined obligation is: defined benefit obligation is:
est Statements
cost Interest cost 6 7 6 7 2018 2017 2018
easurement (gain) / loss Remeasurement (gain) / loss (4) 23 (4) 23 AED m AED m AED m A
Additional
loyee contributions
Information Employee contributions 2 2 2 2 Balance brought forward 456
Balance brought forward 456 558
efits paid Benefits paid (4) (4) (4) (4) Acquisition (Note 33) -
Acquisition (Note 33) - 3
Currency translation differences
ency translation differences 42 (13) 42 (13) Service cost 53
Service cost 53 66
nce carried forward Balance carried forward 328 281 328 281 Interest cost 20
Interest cost 20 23
Remeasurement Remeasurement
- changes in
- changes in experience / demographic experience / demographic (11)
assumptions assumptions (10) (11)
- changes in financial assumptions
- changes in financial assumptions 14 (116) 14
Benefits paid Benefits paid (53) (57) (53)
Transfers - -
Transfers (11)
Balance carried forward Balance carried forward 479 456 479

Payments made during the Payments made

year include during
transfer of the year include
accumulated transfer
benefits to of accumulated benefits to dn
dnata’s
funded scheme. funded scheme.

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19. Retirement
Retirement benefit obligations benefit obligations (continued)
(continued) The sensitivity of the defined The sensitivity
benefit of the
obligation to defined
changesbenefit obligationassumptions
in the principal to changes in the principal assump
are set out below: are set out below:
ned contribution plans Defined contribution plans
Assumption Assumption Change Change
Effect on defined Effect on define
dnata
a pays fixed contributions pays fixed
to certain contributions
defined contributionto plans
certain defined
and has nocontribution
legal or plans and has no legal or
benefit obligation benefit obligatio
constructive obligation to pay further contributions to settle
tructive obligation to pay further contributions to settle the benefits relating to the the benefits relating to the
Unfunded Unfu
oyees employees
service in the current service
and prior in the
periods.   current and prior periods.  
Overview Subsidiaries schemes Subsidiaries sche
AED m AED m AED m A
Emirates
total amount recognised The total
in the amount recognised
consolidated in the consolidated
income statement income
in respect of all thestatement in respect of all the + 0.5% (48) + (28)
0.5% (48)
plans is as follows: Discount rate Discount rate
s is dnata
as follows: - 0.5% 54
- 0.5% 54 31
2018 2017 + 0.5% 7
Expected salary increases+ 0.5% 7 32
Group 2018 2017
AED m AED m Expected salary increases - (29)
0.5% (7)
Financial
AED m AED m - 0.5% (7)
nedInformation
benefit plans Defined benefit plans
The above sensitivity analysisThe aboveon
is based sensitivity
a changeanalysis is based onwhile
in an assumption a change in an
holding allassumption while holdin
dedEmirates
schemes Funded schemes
other assumptions constant. Inother assumptions
practice, constant.
this is unlikely In practice,
to occur, this is unlikely
and changes in some toof
occur, and changes in som
interest cost - netService and interest cost - net 39 38
Financial
ce and 39 38 the assumptions may be
Commentary the assumptions may be correlated. In calculating thecorrelated. In calculating
above sensitivity thethe
analysis, above sensitivity analysis
change in the present value Netofchange in benefit
defined the present value of defined benefit
present value of the defined present value of the
benefit obligation defined
has benefit obligation
been calculated using thehas been calculated using the proje
projected
over plan assets obligations over plan assets - (5)
dnata
gations - (5)
Financial unit credit method at the endunit credit
of the method
reporting at the end of the reporting period.
period.
Commentary
39 33 39 33
Unfunded schemes Theof
weighted average durations of theare
defined
unded schemes
Emirates The weighted average durations the defined benefit obligations set outbenefit
below:obligations are set out below
Consolidated
ce cost Service cost 53 66 53 66
Financial
est Statements
cost Interest cost 20 23 20 23 2018
2018 2017
73 89 73 89 Years Y
dnata Years Years
nedConsolidated
contribution plans Defined contribution plans Funded scheme - Swiss plan Funded scheme - Swiss plan 17.0 17.1 17.0
Financial
Contributions expensed 147 131
ributions expensed
Statements 147 131 Funded scheme - NetherlandsFunded
plan scheme - Netherlands plan 21.0 21.0 21.0
ognised in the Recognised
consolidated income in the consolidated income259
statement statement 253 259 253 Unfunded scheme 12.9
Additional Unfunded scheme 12.9 12.5
Information

Through its defined benefit Through its defined

plans dnata benefit
is exposed to aplans dnata
number of isrisks,
exposed to a number of risks, the
the most
significant
significant of which are detailed below: of which are detailed below:

a) Change in discount rate:a)Retirement

Change inbenefit
discount rate: Retirement
obligations benefit
will increase dueobligations
to a will increase due
decrease in market yields of
decrease in market yields of high quality corporate bonds. high quality corporate bonds.

b) Expected salary increases:b)The

Expected
presentsalary
valueincreases: The present
of the defined benefitvalue of the isdefined benefit obligati
obligation
calculated by reference to thecalculated by reference
future salaries to the futureAs
of plan participants. salaries
such, of
an plan participants.
increase of As such, an increa
the salary
the salary of the plan participants of the plan
will increase participantsbenefit
the retirement will increase the retirement benefit obligations.
obligations.

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Other provisions 20. Other provisions 21. Borrowings and lease liabilities
21. Borrowings and lease liabilities

2018 2017 2018

2018 2017 2018 2017
AED m AED m AED m A
AED m AED m AED m AED m
nce brought forward Balance brought forward 69 33 69 33 Non-current Non-current
tions Additions 14 42 14 42 Term loans (Note 22) Term loans (Note 22) 828 630 828
Overview Lease liabilities (Note 23) Lease liabilities (Note 23) 39 24 39
uisition (Note 33) Acquisition (Note 33) - 4 - 4
ed Emirates
during the year Utilised during the year (30) (4) (30) (4) 867 654 867
ilised amounts reversed Unutilised amounts reversed (9) (3) (9) (3) Current Current
dnata
ency translation differences
Currency translation differences 16 (3) 16 (3) Term loans (Note 22) Term loans (Note 22) 207 198 207
Group Lease liabilities (Note 23) Lease liabilities (Note 23) 12 9 12
nce carried forward Balance carried forward 60 69 60 69
Financial Bank overdrafts (Note 28) Bank overdrafts (Note 28) 73 132 73
Information
isions are expected to beProvisions
used as follows:
are expected to be used as follows: 292 339 292
Emirates 2018 2017 2018 2017 1,159 993 1,159
Financial
Commentary AED m AED m AED m AED m
in one year (Note 18) Within one year (Note 18) 47 45 47 45 Borrowings
Borrowings and lease liabilities and lease
are denominated in liabilities are denominated
the following currencies: in the following currencies:
dnata
one year (Note 18)
Financial Over one year (Note 18) 13 24 13 24
Commentary 2018 2017 2018
March 2018 31 March 2018 60 69 60 69
Emirates
AED m AED m AED m A
Consolidated
Pound Sterling Pound Sterling 312 224 312
provisions
Financial include AEDThe
8 mprovisions
(2017: AED
include
6 m)AED
related
8 m to(2017:
dilapidations
AED 6 m)which
related to dilapidations which
Statements US Dollar US Dollar 271 278 271
esents an estimate of the
represents
costs of an
restoring
estimate
certain
of the
leasehold
costs of properties
restoring certain
to theirleasehold properties to their
UAE Dirham UAE Dirham 213 151 213
nal dnata
condition at the end of
original
the lease
condition
term. at the end of the lease term.
Consolidated Swiss Franc Swiss Franc 121 126 121
Financial
Statements Australian Dollar Australian Dollar 117 79 117

Additional
Singapore Dollar Singapore Dollar 55 57 55
Information Euro Euro 33 33 33
Others Others 37 45 37

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22. Term loans Term loans are denominated in the following currencies:
erm loans Term loans are denominated in the following currencies:
2018
2018 2017
2018 2017 AED m A
2018 2017 AED m AED m
AED m AED m Pound Sterling 292
AED m AED m Pound Sterling 292 224
US Dollar 271
US Dollar 271 278
Balance brought forward 829 491 UAE Dirham 183
nce brought forward 829 491 UAE Dirham 183 116
Overview Acquisitions (Note 33) - 52 Swiss Franc 100
isitions (Note 33) - 52 Swiss Franc 100 99
Emirates Additions 475 515 Australian Dollar 95
tions 475 515 Australian Dollar 95 78
Repayments (306) (192) Singapore Dollar 55
yments
dnata (306) (192) Singapore Dollar 55 -
Currency translation differences 38 (37) Euro 33
ency translation differences 38 (37) Euro 33 33
Group 1,036 829 Others 6
1,036 829 Others 6 -
Financial costs Less: Transaction costs (1) (1)
Transaction (1) (1) Contractual repricing dates are set at three to six month intervals. The effective in
Information
Balance carried forward 1,035 828 Contractual repricing dates are set at three to six month intervals. The effective interest
nce carried forward 1,035 828 rate on the term loans was 2.4% (2017: 2.5%) per annum. The carrying amounts o
rate on the term loans was 2.4% (2017: 2.5%) per annum. The carrying amounts of the
Emirates Term loans are repayable as follows: term loans approximate their fair value. The fair value is determined by discou
loans are repayable as follows:
Financial term loans approximate their fair value. The fair value is determined by discounting
Commentary Within one year 207 198 projected cash flows using the interest rate yield curve applicable to different matu
in one year 207 198 projected cash flows using the interest rate yield curve applicable to different maturities
Between 2 and 5 years 680 591 and currencies adjusted for credit spread and falls within level 2 of the fair
eendnata
2 and 5 years 680 591 and currencies adjusted for credit spread and falls within level 2 of the fair value
Financial After 5 years 148 39 hierarchy.
5 years
Commentary
148 39 hierarchy.
Total over one year 828 630
l over one year 828 630 The term loan in Swiss Francs is designated as a hedge of the net investment in
Emirates The term loan in Swiss Francs is designated as a hedge of the net investment in dnata
Consolidated Switzerland AG. The foreign exchange gain or loss on translation of the loan at th
Switzerland AG. The foreign exchange gain or loss on translation of the loan at the end
Financial
of the reporting period is recognised in the translation reserve through
Statements of the reporting period is recognised in the translation reserve through other
comprehensive income.
comprehensive income.
dnata
Consolidated
Financial
Statements

Additional
Information

171
 THE EMIRATES GROUP
ANNUAL REPORT

2017-18
ease liabilities
23. Lease liabilities The present value of lease liabilities is denominated in the following currencies:
nce Lease 2018 2017 The present value of lease liabilities is denominated in the following currencies:
Finance Lease AED m AED m 2018 2017 2018 2017
AED m AED m AED m AED m 2018
AED m A
Swiss Franc 21 23
nce brought forward 33 24
Australian Dollar Swiss Franc 22 1 21
isitions Balance brought forward - 6 33 24
Others Australian Dollar 8 9 22
Overview
tions Acquisitions 26 11 - 6
Others 8
yments
Emirates
Additions (9) (7) 26 11 Lease liabilities are secured on the related plant and machinery.
Repayments
ency translation differences 1 (1) (9) (7) Lease liabilities are secured on the related plant and machinery.
dnata The carrying amount of lease liabilities approximate to their fair values. The fair value is
nce carried forward Currency translation differences 51 33 1 (1)
The carrying
determined by discounting projected cashamount of lease
flows using the liabilities approximate
interest rate to their
yield curve for fair values. The fair va
Group Balance carried forward 51 33 determined by discounting projected cashspread
flows using the interest rate yield curv
the remaining term to maturities and currencies adjusted for credit and falls
s lease liabilities:
Financial the remaining
within level 2 of the fair value hierarchy. term to maturities and currencies adjusted for credit spread and
in one year
Information Gross lease liabilities: 13 10 within level 2 of the fair value hierarchy.
eenEmirates
2 and 5 years Within one year 28 25 13 10
Financial
5 years Between 2 and 5 years 12 1 28 25
Commentary
After 5 years 53 36 12 1
dnata
re interest (2) (3) 53 36
Financial
entCommentary
value of lease Future interest
liabilities 51 33 (2) (3)
Present value of lease liabilities 51 33
Emirates
Consolidated
present value of lease liabilities is repayable as follows:
Financial
in one year
Statements The present value of lease liabilities is repayable
12 as follows:
9
eendnata
2 and 5 years Within one year 27 23 12 9
Consolidated
5 years Between 2 and 5 years 12 1 27 23
Financial
l over one year
Statements After 5 years 39 24 12 1
Total over one year 39 24
Additional
Information

172
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4. Deferred income tax 24. Deferred income tax The movements in deferredThe taxmovements in deferred
assets and liabilities tax assets
during andwithout
the year, liabilities during
taking the year, without taking int
into
consideration the offsettingconsideration the offsetting
of balances within the sameoftaxbalances within
jurisdiction, the
are assame tax jurisdiction, are as follows:
follows:
Deferred
eferred tax assets and liabilities aretax assets
offset andthere
when liabilities
is a are offset
legally when there
enforceable is atolegally enforceable right to
right
offsetcurrent
fset current tax assets against currenttax
taxliabilities
assets against
and whencurrent
the tax liabilities
deferred andrelate
taxes when the deferred taxes relate Deferred income tax liabilities
Deferred income tax liabilities
to the same
the same income tax authority. income
The offset tax authority.
amounts The offset amounts are as follows:
are as follows: Property, Property,
plant and Intangible plant and Intangible
Overview 2018 2017
2018 2017 equipment assets equipment
Other assets
Total Other Tota
AED m AED m AED m AED m AEDmm AED
Emirates AED m AED m AED AED mm AED m AED m

dnataincome tax assets Deferred income tax assets

eferred 81 62 81 62 1 April 2016 1 April 2016 (39) (86) (39)
(1) (86)
(126) (1) (126
Deferred income tax liabilities (142) (148) Acquisition Acquisition (1) (90) - (1) (90)
(91) - (91
eferred income tax liabilities
Group
(142) (148)
Credited to the consolidatedCredited to the consolidated
(61) (86) (61) (86)
Financial income statement income statement - 28 -- 2828 - 28
he movement The tax
in the deferred movement
account in thefollows:
is as deferred tax account is as follows:
Information Currency translation differences
Currency translation differences 2 4 - 2 6 4 - 6
alance brought forward Balance brought forward (86) (34) (86) (34)
31 March 2017 (38) (144) (1) (183
Emirates 31 March 2017 (38) (144) (1) (183)
cquisition
Financial(Note 33)
Acquisition (Note 33) (2) (91) (2) (91) Acquisition (Note 33) -
Acquisition (Note 33) (2) -- (2)(2) - (2
Commentary
edited to the consolidatedCredited
incometo the consolidated
statement (Note 7 )income statement61
(Note 7 ) 22 61 22 Credited to the consolidatedCredited
incometo the consolidated income
thers
dnata Others (31) 12 (31) 12 statement statement 5 47 - 5 5247 - 52
Financial Currency translation differences
Currency translation differences
urrency translation differences
Commentary (3) 5 (3) 5 Currency translation differences (2) (6) - (2) (8)(6) - (8
alance carried forward Balance carried forward (61) (86) (61) (86) Others Others (18) (4) (18)
(1) (23)(4) (1) (23
Emirates
31 March 2018 31 March 2018 (53) (109) (53)
(2) (109)
(164) (2) (164
Consolidated
Financial Deferred income tax assets
Statements Deferred income tax assets
Tax losses Provisions TaxOther
losses Provisions
Total Other Tota
dnata
Consolidated AED m AED m AED mm
AED AEDAED
mm AED m AED m
Financial
Statements 1 April 2016 1 April 2016 48 21 48
23 9221 23 92
(Charge) / credited to the (Charge) / credited to the
Additional consolidated income (6)
statement (3)
Information consolidated income statement 3(6) (6)(3) 3 (6
Currency translation differences
Currency translation differences (3) - 2(3) (1)- 2 (1
Others Others (23) 23 (23)
12 1223 12 12
31 March 2017 31 March 2017 16 41 4016 9741 40 97
(Charge) / credited to the (Charge) / credited to the
consolidated income (4)
consolidated income statement statement 6 7(4) 9 6 7 9
Currency translation differences
Currency translation differences 2 2 12 5 2 1 5
Others Others - (11) 3- (11)
(8) 3 (8
31 March 2018 31 March 2018 14 38 14
51 10338 51 103

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2017-18

Operating leases 25. Operating leases 28. Short

28. Short term bank deposits, termcash
cash and bank deposits, cash and cash equivalents
equivalents

Future
ure minimum lease payments minimum
under lease payments
non-cancellable underleases
operating non-cancellable operating leases are as follows:
are as follows: 2018 2017 2018 20
AED m AED m AED m AED

2018 2017 2018 2017 Bank deposits Bank deposits 4,054 2,479 4,054 2,47
AED m AED m AED m AED m Cash and bank Cash and bank 891 919 891 91
Overview

s than 1 year
Emirates Less than 1 year 396 322 396 322 Cash and bank balances Cash and bank balances 4,945 3,398 4,945 3,39
ween 2 and 5 years Between 2 and 5 years 1,232 866 1,232 866 Less:
Less: Short term bank deposits Short
over term bank deposits over 3 months
3 months (3,760) (2,016) (3,760) (2,01
dnata
er 5 years After 5 years 1,003 802 1,003 802
Group 2,631 1,990 2,631 1,990 Cash and cash equivalentsCash and
as per thecash equivalents as per the
Financial consolidated statement ofconsolidated statement of financial position
financial position 1,185 1,382 1,185 1,38
Information Bank overdrafts (Note 21) Bank overdrafts (Note 21) (73) (132) (73) (13
Capital commitments 26. Capital commitments
Emirates 2018 2017 2018 2017 Cash and cash equivalentsCash and
as per thecash equivalents as per the
Financial
Commentary AED m AED m AED m AED m consolidated statement ofconsolidated
cash flows statement of cash flows 1,112 1,250 1,112 1,25

dnata
horised and contracted: Authorised and contracted: Shortand
Short term bank deposits, cash termcash
bank deposits, cash
equivalents yield and cash equivalents
an effective yieldofan effective interest rate
interest rate
Financial
ta Commentary dnata 373 142 373 142 2.8% (2017: 2.5%) per annum.
2.8% (2017: 2.5%) per annum.
nt ventures
Emirates
Joint ventures 12 14 12 14
Consolidated 385 156 385 156
Financial
Statements
29. Derivative financial instruments
29. Derivative financial instruments

Authorised but not contracted:

horised but not contracted:
dnata
2018 2017 2018 20
ta Consolidated dnata 594 429 594 429
Financial AED m AED m AED m AED
Statements 979 585 979 585
Guarantees
Additional 27. Guarantees Current assets Current assets
Information
Currency swaps and forwards
Currency swaps and forwards - 5 -
2018 2017 2018 2017 - 5 -
AED m AED m AED m AED m Current liabilities Current liabilities
Currency swaps and forwards
Currency swaps and forwards 25 3 25
Guarantees
arantees and letters of credit providedand
by letters of credit provided by
25 3 25
banks
ks in the normal course of in the normal course of business
business 396 333 396 333

The outstanding
The notional principal amounts notional principal
are: amounts outstanding are:
Guarantees
arantees and letters of credit andAED
include letters
45 mof (2017:
credit AED
include
51 AED 45 m (2017:
m) provided by AED 51 m) provided by
2018 2017 2018 20
companies
mpanies under common control under commercial
on normal common control
terms.on normal commercial terms.
AED m AED m AED m AED

Currency contracts Currency contracts 1,000 834 1,000 83

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30. Classification of financial instruments

The accounting policies for financial instruments have been applied to the following:
Assets and Financial
Derivative liabilities at fair liabilities at
Loans and financial value through amortised
receivables instruments profit and loss cost Total
Overview
AED m AED m AED m AED m AED m
Emirates 2018
Assets
dnata
Trade and other receivables (excluding prepayments
Group
and advance lease rentals) 3,095 - - - 3,095
Financial Short term bank deposits 3,760 - - - 3,760
Information
Cash and cash equivalents 1,185 - - - 1,185
Emirates Total 8,040 - - - 8,040
Financial
Commentary
Liabilities
dnata Borrowings and lease liabilities - - - 1,159 1,159
Financial
Commentary Trade and other payables (excluding deferred
revenue and customer deposits) - - - 4,166 4,166
Emirates
Consolidated Derivative financial instruments - 25 - - 25
Financial
Statements
Total - 25 - 5,325 5,350

dnata
Consolidated 2017
Financial Assets
Statements
Derivative financial instruments - 5 - - 5
Additional Trade and other receivables (excluding prepayments
Information
and advance lease rentals) 2,840 - - - 2,840
Short term bank deposits 2,016 - - - 2,016
Cash and cash equivalents 1,382 - - - 1,382
Total 6,238 5 - - 6,243

Liabilities
Borrowings and lease liabilities - - - 993 993
Trade and other payables (excluding deferred
revenue and customer deposits) - - 13 2,742 2,755
Derivative financial instruments - 3 - - 3
Total - 3 13 3,735 3,751

Except as otherwise stated, the carrying amounts of financial assets and financial liabilities approximate their fair values.

175
 THE EMIRATES GROUP
ANNUAL REPORT

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31.and
Related party transactions Related party transactions and balances
balances dnata uses a number of publicdnata uses
utilities a number
provided by of public utilities
Government provided
controlled by Government
entities for controlled entities
its these
its operations in Dubai, where operations in are
entities Dubai,
the where these entities
sole providers of theare the sole providers of the relev
relevant
dnata
a transacts with associates, jointtransacts
ventureswith
and associates,
companiesjoint ventures
controlled by and companies
dnata and controlled by dnata and
services.
services. This includes the supply This includes
of electricity, waterthe
andsupply ofservices.
airport electricity, water and airport services. Transacti
Transactions
its parent within the scope of
arent within the scope of its ordinary business activities.its ordinary business activities.
falling are
falling in these expense categories in these expense
individually categories and
insignificant are individually
were carriedinsignificant
out and were carried
dnata
a and Emirates share central and Emirates
corporate sharesuch
functions central corporate functions
as information such as information technology,
technology, on an arm's length basis. on an arm's length basis.
ties, human resources, facilities, human resources,
finance, treasury, finance, treasury,
cash management, legal andcash management, legal and other
other
Overview
functions.
tions. Where such functions Where
are shared thesuch
costsfunctions are shared
are allocated thednata
between costs and
are allocated between dnata and 2018 2017 2018 20
Emirates based on activity levels. AED m AED m AED m AED
atesEmirates
based on activity levels.
Year end balances Year end balances
er than Other
dnatathese shared services than these shared
arrangements servicestransactions
the following arrangements thetaken
have following transactions have taken
(i) Receivables-sale of goods(i)and
Receivables-sale
services (Noteof goods and services (Note 14)
14)
place on an arm's length basis.
e on an arm's length basis.
Group Companies under common control
Companies under common control 287 360 287 3
2018 2017 2018 2017
Financial Associates Associates 38 43 38
AED m AED m AED m AED m
Information
Joint ventures Joint ventures 46 42 46
ding transactions Trading transactions
(i) Sale of goods and services 371 445 371 4
ale Emirates
of goods and services
Financial
of goods Sale common
- Companies under
Commentary of goods control
- Companies under common
434 control 339 434 339 (ii) Payables-purchase
(ii) Payables-purchase of goods and services (Noteof goods and services (Note 17)
17)
ices rendered - Companies Services
under rendered - Companies under2,262
common control common control
2,004 2,262 2,004 Joint ventures Joint ventures 44 58 44
dnata
icesFinancial
rendered Services rendered - Joint ventures
- Joint ventures 53 40 53 40 Companies under common control
Companies under common control 55 19 55
Commentary
ices rendered - AssociatesServices rendered - Associates 13 17 13 17 Associates Associates 3 - 3
Emirates 2,762 2,400 2,762 2,400 102 77 102
Consolidated
Purchase
Financialof goods (ii) Purchase
and services of goods and services (iii) Borrowings (iii) Borrowings
Statements
Purchase
hase of goods - Companies of goods control
under common - Companies under 114
common control
98 114 98 Companies under common control
Companies under common control 184 147 184 1
hase of goods
dnata Purchase of goods - Associates
- Associates - 2 - 2
Consolidated
icesFinancial
received - CompaniesServices received control
under common - Companies under common
499 control
446 499 446 (iv) Loans - receivable (Note(iv)
14)Loans - receivable (Note 14)
Statements
Services received - Joint ventures
ices received - Joint ventures 220 236 220 236 Joint ventures Joint ventures 113 111 113 1
Additional 833 782 833 782
Information Other transactions
er transactions Movement
Movement in the loans were as follows: in the loans were as follows:
nance income (i) Finance income Balance brought forward Balance brought forward 111 147 111 1
Companies under common control
panies under common control 74 42 74 42 Additions Additions 12 1 12

ventures Joint ventures 4 3 4 3 Repayments Repayments (24) (20) (24) (

78 45 78 45 Currency translation differences

Currency translation differences 14 (17) 14 (
Balance carried forward Balance carried forward 113 111 113 1
inance cost (ii) Finance cost
Companies under common control
panies under common control 5 4 5 4 The loans
The loans earned effective interest earned
of 2.9% effective
(2017: interest
2.8%) per of 2.9% (2017: 2.8%) per annum.
annum.

(iii) Compensation
Compensation to key management to key management personnel
personnel
Salaries
ries and short-term employee and short-term employee benefits
benefits 49 32 49 32
-employment benefits Post-employment benefits 5 5 5 5
54 37 54 37

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32. Financial risk management

inancial risk management Currency risk Currency risk

Certain subsidiaries of dnataCertain subsidiaries

are exposed of dnata
to currency riskareonexposed
purchaseto ofcurrency
servicesrisk on purchase of ser
a has limited exposure todnata has risks
financial limited
by exposure to financial
virtue of the risks
nature of by virtue of In
its operations. the nature of its operations. In
outside the source market. These subsidiaries manage such risks through currency such risks through curr
outside the source market. These subsidiaries manage
the exist,
areas where financial risks areas the
where
aimfinancial risks exist,
is to achieve the aim is balance
an appropriate to achieve an appropriate balance
forwards. forwards.
between risk
een risk and return and minimise and return
potential andeffects
adverse minimise potential
on dnata’s adverse effects on dnata’s consolidated
consolidated
cial position. financial position. dnata is exposed to
Overview
dnata is exposed to the effects of fluctuations in the effects foreign
prevailing of fluctuations
currencyinexchange
prevailing foreign currency exch
dnata’s risk
a’s risk management procedures are management procedures
designed to identify are designed
and analyse to identify
these risks, to and analyse these risks, to rates on its long term debtrates on its long
obligations term debt
denominated in obligations
Swiss Franc,denominated
Euro, Poundin Swiss Franc, Euro, P
Emirates
set appropriate risk limits and controls and to monitor
ppropriate risk limits and controls and to monitor the risks and adherence to limitsthe risks and adherence to limits Sterling, Singapore Dollar andSterling, Singapore
Australian Dollarflows
Dollar. Cash and Australian Dollar. CashItaly,
from the Switzerland, flows from the Switzerland,
by meansinformation.
of reliable and up-to-date United Kingdom and Australian operations
United Kingdom and Australian operations are adequate to meet the repayment are adequate to meet the repay
means of reliable and up-to-date
dnata dnata reviews itsinformation. dnata reviews its risk management
risk management
edures and systems on a regular basis to reflect changes in markets, productschanges
procedures and systems on a regular basis to reflect and in markets, products and schedules. A 1% change in schedules.
exchange A 1%forchange
rate these in exchangewould
currencies rate for
not these
have currencies
a would not ha
Group
emerging best practice. significant impact on profit or equity. At dnata parent
significant impact on profit or equity. At dnata parent level these liabilities provide a level these liabilities prov
ging best practice.
Financial natural hedge to its foreign currency
natural hedge to its foreign currency investments in these countries. investments in these countries.
Information
management proceduresRisk are management
approved by procedures are approved
a steering group by aofsteering
comprising senior group comprising of senior
(ii) Credit risk (ii) Credit risk
agement. management.
Emirates Their identification, Theirand
evaluation identification,
hedging ofevaluation and hedging
financial risks are of financial risks are
Financial
ormed in close
Commentary
performed
cooperation with in
the close cooperation
operating units. with
Senior the operating
management is units.
also Senior management is also dnata
dnata is exposed to credit risk, is exposed
which to credit
is the risk risk,counterparty
that the which is thewill
riskcause
that athe counterparty will cau
responsible
onsible for the review of risk managementfor the review
and of risk management
the control environment. and
The the control environment. The various
various financial
financial loss to dnata by failing to loss to dnata
discharge an by failing to
obligation. discharge
Financial an that
assets obligation. Financial assets
dnata
cialFinancial financial
risk elements are discussed risk elements are discussed below.
below. potentially subject dnata to potentially subject principally
credit risk consist dnata to credit risk consist
of deposits principally
with banks and of deposits with banks
Commentary trade receivables. dnata usestrade receivables.
external dnataasuses
ratings such external
Standard ratings Moody's
& Poor's, such as Standard
or & Poor's, Moody
arket risk (i) Market risk
Emirates
their equivalent
their equivalent in order to measure in order
and monitor to measure
its credit and monitor
risk exposures its credit risk exposures to fina
to financial
is the risk that theMarket
Consolidated
et risk riskorisfuture
fair value the risk thatflows
cash the fair
of avalue or future
financial cash flows
instrument will of a financial instrument will institutions. In the absence ofinstitutions.
independent In the absence
ratings, creditofquality
independent ratings,
is assessed basedcredit
on quality is assessed base
Financial
uateStatements
because of changes fluctuate because
in market of changes
prices. Market risksin market
relevantprices. Market risks relevant to dnata's
to dnata's the counterparty's
the counterparty's financial position, financial
past experience and position, past experience and other factors.
other factors.
ations operations
are interest rate risk are interest
and currency risk. rate risk and currency risk.
dnata
Consolidated dnata manages
dnata manages limits and controls limitsofand
concentration riskcontrols
whereverconcentration of risk wherever they are ident
they are identified.
estFinancial
rate risk Interest rate risk
Statements dnata places significant deposits with high credit quality banks. Exposure to credit risk banks.
dnata places significant deposits with high credit quality is Exposure to credit r
dnata
a is exposed to the effects is exposed to
of fluctuations in the effects levels
prevailing of fluctuations
of interestinrates
prevailing
on levels of interest rates on also managed through regular alsoanalysis
managed through
of the abilityregular analysis of the
of counterparties and ability of counterparties and pote
potential
Additional
owings borrowings and investments. Exposure arises from
and investments. Exposure arises from interest rate fluctuations in the
Information interest rate fluctuations in the counterparties to meet their obligations and by changing their limits where appropriate.their limits where approp
counterparties to meet their obligations and by changing
international
national financial markets financial
with respect markets
to interest costwith
on respect
its longtoterm
interest
debt cost on its long term debt Approximately
Approximately AED 3,418 m (2017: 1,753 m)AED 3,418term
of short m (2017: 1,753 m) and
bank deposits of short
cash term
and bank deposits and cash
obligations and interest
ations and interest income on its bank deposits. income on its bank deposits. bank balances are held with financial institutions
bank balances are held with financial institutions under common control. under common control.

Borrowings
owings obtained at variable obtained
rates expose dnataat to
variable ratesinterest
cash flow exposerate
dnatarisk.toNo
cash flow interest rate risk. No
Policies are in place to ensurePolicies are inare
that sales place to to
made ensure that sales
customers with are made to customers with an approp
an appropriate
hedging
ing cover is obtained due cover isinterest
to the stable obtained
ratedue to the stable
environment thatinterest rate
exists in theenvironment that exists in the
credit history failing which ancredit history level
appropriate failing
ofwhich an isappropriate
security level of
obtained, where security is obtained, where nece
necessary
tries where the loans are countries where the loans are contracted.
contracted. salesCredit
are made
sales are made on cash terms. limits on
are cash
also terms. Credit
imposed limits
to cap are alsotoimposed
exposure a to cap exposure
customer. customer.
key reference rates basedThe key reference
on which interest rates
costsbased on which interest
are determined are USDcosts
LIBORarefordetermined are USD LIBOR for
United
ed States Dollar, CHF LIBOR StatesFranc,
for Swiss Dollar,
GBPCHF LIBOR
LIBOR forfor SwissSterling,
Pound Franc, GBP LIBOR
BBSY for for Pound Sterling, BBSY for
Australian
ralian Dollar, EURIBOR for Euro andDollar,
SIBOREURIBOR for Euro
for Singapore and A
Dollar. SIBOR for Singapore
25 basis point Dollar. A 25 basis point
ge in these interest rates change in these
would not have interest ratesimpact
a significant would on
notprofit
have or
a significant
equity. impact on profit or equity.

177
 THE EMIRATES GROUP
ANNUAL REPORT

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32. Financial risk management (continued) Summarised

Summarised below in the table below in
is the maturity the table
profile is the maturity
of financial liabilitiesprofile
based of
onfinancial
the liabilities based on the
32. Financial risk management (continued)
remaining
remaining period at the end period at period
of the reporting the endto of
thethe reporting maturity
contractual period todate.
the contractual maturity date.
Theanalysis
The table below presents an table below presents
of short an analysis
term bank ofand
deposits short term
bank bank deposits
balances by and bank balances by
The amounts disclosed are The amounts disclosed
the contractual are thecash
undiscounted contractual
flows. undiscounted cash flows.
rating agency designation at the end of the reporting
ating agency designation at the end of the reporting period based on Standard & period based on Standard &
Poor's
Poor's ratings or its equivalent forratings or its
the main equivalent
banking for the main banking relationships:
relationships:
Less than 1 2 - 5 LessOver
than51 2-5 Over 5
2018 2017 year years year
years years
Total years Total
Overview
2018 2017
AED m AED m AED m AED m AEDm
AED m AEDm
AED m AED m AED m
AED m AED m
AA- Emirates
to AA+ AA- to AA+ 156 153 156 153 2018
2018
A- todnata
A+ A- to A+ 3,891 2,276 3,891 2,276 Borrowings and lease
Borrowings and lease liabilities 324 liabilities763 324
169 763
1,256 169 1,256
BBB+ BBB+ 377 568 377 568 Derivative financial
Group Derivative financial instruments 25instruments - -25 25- - 25
Lower than BBB+ 509 396
Lower than BBB+ 509 396 Trade and other payables Trade and other payables
Financial Unrated 2 1
Unrated
Information
2 1 (excluding deferred revenue(excluding
and deferred revenue and
(iii) Liquidity risk customer deposits) customer deposits)
4,096 70 4,096
- 70
4,166 - 4,166
iii) Liquidity risk
Emirates
Financial 4,445 833 4,445
169 833
5,447 169 5,447
Liquidity risk is
the risk thatLiquidity
dnata isrisk is thetorisk
unable thatitsdnata
meet is unable
payment to meet
obligations its payment obligations associated
associated
Commentary
2017 2017
with its financial liabilities when they fall
with its financial liabilities when they fall due and to replace funds when they due and to replace
are funds when they are
dnata
Borrowings and lease
Borrowings and lease liabilities 361 liabilities660 361
42 660
1,063 42 1,063
withdrawn. withdrawn.
Financial Derivative
Derivative financial instruments financial 3instruments - -3 3- - 3
Commentary
dnata’s
dnata’s liquidity management liquidity
process management
is monitored process
by senior is monitored
management andbyincludes
senior management and includes
Trade and other payables Trade and other payables
he following:
Emirates the following:
Consolidated (excluding deferred revenue(excluding
and deferred revenue and
Financial  Day by
Day to day funding, managed to monitoring
day funding,future
managed
cash by monitoring
flows to ensurefuture
that cash flows to ensure that customer deposits) customer deposits)
2,670 85 2,670
- 85
2,755 - 2,755
Statements
requirements can be met.requirements
This includes canreplenishment
be met. Thisofincludes
funds as replenishment
they of funds as they 3,034 745 3,034
42 745
3,821 42 3,821
dnatamature. mature.
Consolidated  Maintaining
Maintaining rolling forecasts of dnata’srolling forecasts
liquidity of dnata’s
position on the liquidity
basis of position on the basis of
Financial
expected cash flows. expected cash flows.
 Monitoring liquidity  ratios
Statements
Monitoring
against liquidity
internal ratios against regulatory
and external internal and external regulatory
requirements.
Additional requirements.
Information  Maintaining
Maintaining debt financing plans. debt financing plans.
 Maintaining diversified  credit
Maintaining
lines, diversified credit lines,
including stand-by creditincluding
facility stand-by credit facility

Sources of liquidity are Sources

regularly ofreviewed
liquidityasarerequired
regularly
by reviewed as required to
senior management by senior management to
maintain a diversification by geography,
maintain a diversification by geography, provider, product and term. provider, product and term.

178
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33. Acquisitions 33. Acquisitions 34. Capital management

34. Capital management
2018 2018 dnata monitors the returndnata
on equity whichthe
monitors is defined asequity
return on profit which
for theisyear expressed
defined as afor the year expressed as a
as profit
On 9th May 2017, dnata On acquired a 100% percentage of average equity. dnata of
percentage seeks to provide
average equity.a dnata
higherseeks
returnto to the Owner
provide by return to the Owner by
a higher
9th May 2017, shareholding in ALX
dnata acquired Cargo
a 100% Center IAHinLLC
shareholding ALX Cargo Center IAH LLC
"ALX"), through its wholy("ALX"),
owned through
subsidiaryitsdnata resorting to borrowings to finance to
resorting its borrowings
acquisitions.toInfinance
2018, dnata achieved aInreturn
its acquisitions. 2018, on
dnata achieved a return on
wholy owned subsidiary dnata at
Aviation Services US Inc. a purchase
Aviation Services US Inc. at a purchase
consideration of AED 12 m, paid in cash.ofALX equity of 19.3% (2017: 20.3%).
equity of 19.3% (2017: 20.3%).
consideration AEDprimarily operates
12 m, paid a perishable
in cash. cargo
ALX primarily facility a perishable cargo facility
operates
Overview
based at Houston Airport based
(“IAH”).atThe purchase consideration is attributable to customer
Houston Airport (“IAH”). The purchase consideration is attributable to customer
elationships
Emirates and goodwill.relationships and goodwill.

During the year, dnata also

dnata
acquired
During 100%dnata
the year, ownership of Destination
also acquired Asia (Singapore)
100% ownership Pte
of Destination Asia (Singapore) Pte
Limited, the purchase consideration and the assets and liabilities arising from and
Limited, the purchase consideration and the assets and liabilities arising from and
Group
ecognised on this acquisition are not on
recognised significant.
this acquisition are not significant.
Financial
2017
Information 2017
n the previous year, dnata
Emirates In through its wholly
the previous ownedthrough
year, dnata subsidiaryits Dnata
wholly Aviation Services Dnata Aviation Services
owned subsidiary
Financial
Limited, acquired
Commentary 100% ownership of Ground Services International Inc. (GSI) and
Limited, acquired 100% ownership of Ground Services International Metro Inc. (GSI) and Metro
Air Service Inc and 95% ownership of Air Dispatch (CLC) s.r.o. Through a step acquisition
Air Service Inc and 95% ownership of Air Dispatch (CLC) s.r.o. Through a step acquisition
dnata
dnata also obtained 100%dnata
Financial control of obtained
also a joint venture, Transecure
100% control of a LLC
jointand 76.9%Transecure
venture, control of LLC and 76.9% control of
Commentary
ts associate Oman United its
Agencies Travel LLC.
associate Oman United Agencies Travel LLC.

The Emirates
assets and the liabilities
Consolidated
arisingand
The assets fromtheand recognised
liabilities onfrom
arising the acquisition of theon the acquisition of the
and recognised
ubsidiaries
Financial were as follows:
subsidiaries were as follows:
Statements
dnata dnata
dnata
Consolidated Aviation Aviation
Financial Transecure Services Transecure
Statements
Services
LLC US Inc. Others
LLC Total
US Inc. Others Total
Additional AED m AED m AED
Information AEDmm AED
AEDmm AED m AED m
Fair value of net assets acquired 62
Fair value of net assets acquired 229 5062 341
229 50 341
Less: Non-controlling interest -
Less: Non-controlling interest - (11)- (11)- (11) (11)
dnata's share of net assets
dnata's share of net assets
acquired acquired 62 229 3962 330
229 39 330
Goodwill (Note 10) Goodwill (Note 10) - 285 21- 306
285 21 306
Total purchase consideration 62
Total purchase consideration 514 6062 636
514 60 636
Less: Cash and cash equivalents
Less: Cash and cash equivalents
acquired acquired (3) (5) (5)(3) (13)(5) (5) (13)
Less: Fair value of retainedLess:
interest
Fair value of retained interest
Note 11) (Note 11) (7) - (16)(7) (23)- (16) (23)
Less: Contingent consideration -
Less: Contingent consideration (18) -- (18)
(18) - (18)
Cash outflow on acquisition 52
Cash outflow on acquisition 491 3952 582
491 39 582

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THE EMIRATES GROUP
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Overview

Emirates

dnata

Group

Financial
Information

Additional
Emirates
Financial
Commentary

dnata
Financial
Commentary

Emirates
Consolidated
Financial
Statements

dnata
Consolidated
Financial
Statements
I N F O R M AT I O N
Additional
Information

180
THE EMIRATES GROUP
ANNUAL REPORT

2017-18
2016-17

Overview

Emirates

dnata

Group 1 8 2 E M I R AT E S T E N - Y E A R O V E R V I E W

Financial
Information 184 dnata TEN-YEAR OVERVIEW
Emirates
Financial 186 GROUP TEN-YEAR OVERVIEW
Commentary

dnata
Financial
1 8 7 G R O U P C O M PA N I E S O F E M I R AT E S
Commentary

Emirates 1 8 8 G R O U P C O M PA N I E S O F d n a t a
Consolidated
Financial
Statements 190 GLOSSARY
dnata
Consolidated
Financial
Statements

Additional
Information

181
 Emirates ten-year overview
THE EMIRATES GROUP
ANNUAL REPORT

2017-18 Emirates
Ten-year overview
Consolidated income statement 2017-18 2016-17 2015-16 2014-15 2013-14 2012-13 2011-12 2010-11 2009-10 2008-09
Revenue and other operating income AED m 92,322 85,083 85,044 88,819 82,636 73,113 62,287 54,231 43,455 43,266

Operating costs AED m 88,236 82,648 76,714 82,926 78,376 70,274 60,474 48,788 39,890 40,988
- of which jet fuel AED m 24,715 20,968 19,731 28,690 30,685 27,855 24,292 16,820 11,908 14,443
- of which employee costs AED m 13,080 12,864 12,452 11,851 10,230 9,029 7,936 7,615 6,345 5,861

Overview Operating profit AED m 4,086 2,435 8,330 5,893 4,260 2,839 1,813 5,443 3,565 2,278

Emirates Profit attributable to the Owner AED m 2,796 1,250 7,125 4,555 3,254 2,283 1,502 5,375 3,538 686

dnata
Consolidated statement of financial position
Group Non-current assets AED m 93,417 93,722 87,752 83,627 74,250 59,856 51,896 43,223 36,870 31,919
Current assets AED m 34,170 27,836 31,427 27,735 27,354 34,947 25,190 21,867 18,677 15,530
Financial
Information - of which cash assets AED m 20,420 15,668 19,988 16,885 16,561 24,572 15,587 13,973 10,511 7,168
Total assets AED m 127,587 121,558 119,179 111,362 101,604 94,803 77,086 65,090 55,547 47,449
Emirates
Financial
Commentary Total equity AED m 37,046 35,094 32,405 28,286 25,471 23,032 21,466 20,813 17,475 15,571
- of which equity attributable to the Owner AED m 36,454 34,508 31,909 27,886 25,176 22,762 21,224 20,606 17,274 15,412
dnata
Financial Non-current liabilities AED m 49,975 48,082 48,250 48,595 43,705 40,452 30,574 22,987 19,552 17,753
Commentary
Current liabilities AED m 40,566 38,382 38,524 34,481 32,428 31,319 25,046 21,290 18,520 14,125
Emirates
Consolidated
Consolidated statement of cash flows
Financial
Statements Cash flow from operating activities AED m 14,134 10,425 14,105 13,265 12,649 12,814 8,107 11,004 8,328 5,016
Cash flow from investing activities AED m (10,977) (3,129) (2,361) (6,411) (4,257) (15,061) (10,566) (5,092) (577) 1,896
dnata
Consolidated Cash flow from financing activities AED m (6,442) (10,502) (7,975) (6,264) (7,107) 1,240 (201) (5,046) (2,982) (5,085)
Financial
Statements Net change in cash and cash equivalents AED m (3,285) (3,206) 3,769 590 1,285 (1,007) (2,660) 866 4,769 1,827

Additional
Other financial data
Information
Net change in cash assets AED m 4,752 (4,320) 3,103 324 (8,011) 8,985 1,614 3,462 3,343 (3,192)
Emirates Ten-Year EBITDAR AED m 24,970 21,248 24,415 20,259 17,229 13,891 10,735 13,437 10,638 8,286
Overview

dnata Ten Year Borrowings and lease liabilities AED m 51,101 51,002 50,105 47,808 42,431 40,525 30,880 23,230 19,605 16,512
Overview
Less: Cash assets AED m 20,420 15,668 19,988 16,885 16,561 24,572 15,587 13,973 10,511 7,368
Group Ten-Year Net debt AED m 30,681 35,334 30,117 30,923 25,870 15,953 15,293 9,257 9,094 9,144
Overview

Group Companies Capital expenditure AED m 8,496 12,632 16,723 19,873 21,142 13,378 13,644 12,238 8,053 10,178
of Emirates

Group Companies Notes :

of dnata

Glossary
1. The ten-year overview has been extracted from the audited financial statements which have been drawn up in compliance with IFRS. New Standards and amendments to existing IFRS have been
adopted on the effective dates applicable to Emirates.
2. Comparative
Notes : figures are restated, where applicable, according to IFRS rules i.e. only the immediately preceding year's figures are restated and figures beyond that year have not been amended.
1. The ten-year overview has been extracted from the audited financial statements which have been drawn up in compliance with IFRS. New Standards and amendments to existing IFRS have been adopted on
the effective dates applicable to Emirates.
2. Comparative figures are restated, where applicable, according to IFRS rules i.e. only the immediately preceding year’s figures are restated and figures beyond that year have not been amended.

182
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2017-18
Key ratios 2017-18 2016-17 2015-16 2014-15 2013-14 2012-13 2011-12 2010-11 2009-10 2008-09
Operating margin % 4.4 2.9 9.8 6.6 5.2 3.9 2.9 10.0 8.2 5.3
Profit margin % 3.0 1.5 8.4 5.1 3.9 3.1 2.4 9.9 8.1 1.6
Return on shareholder's funds % 7.9 3.8 23.8 17.2 13.6 10.4 7.2 28.4 21.6 4.4
EBITDAR margin % 27.0 25.0 28.7 22.8 20.8 19.0 17.2 24.8 24.5 19.2

Cash assets to revenue and other operating income % 22.1 18.4 23.5 19.0 20.0 33.6 25.0 25.8 24.2 17.0

Net debt to equity ratio % 82.8 100.7 92.9 109.3 101.6 69.3 71.2 44.5 52.0 58.7
Overview
Net debt (incl. aircraft operating leases) to equity ratio % 216.4 237.9 215.9 212.1 209.9 186.4 162.1 127.6 158.5 167.0
Emirates
Net debt (incl. aircraft operating leases) to EBITDAR % 321.0 392.9 286.5 296.2 310.3 309.1 324.1 197.6 260.3 313.9
Effective interest rate on borrowings and lease liabilities % 3.2 3.0 3.1 3.3 3.2 3.1 3.0 2.7 2.5 3.5
dnata Fixed to floating debt mix 72:28 75:25 92:8 85:15 94:6 90:10 89:11 89:11 83:17 61:39

Group Airline Operating Statistics

Performance Indicators
Financial Yield Fils per RTKM 213 204 218 245 250 249 251 232 211 254
Information
Unit cost Fils per ATKM 139 132 132 158 162 167 166 147 136 163
Unit cost excluding jet fuel Fils per ATKM 98 97 97 102 97 99 97 95 94 104
Emirates
Financial Breakeven load factor % 65.2 64.5 60.4 64.7 64.9 66.9 65.9 63.6 64.4 64.1
Commentary
Fleet
dnata Aircraft number 268 259 251 231 217 197 169 148 142 127
Financial
Average fleet age months 68 63 74 75 74 72 77 77 69 64
Commentary

Emirates Production
Consolidated Destination cities number 157 156 153 144 142 133 123 112 102 99
Financial Overall capacity ATKM million 61,425 60,461 56,383 50,844 46,820 40,934 35,467 32,057 28,526 24,397
Statements
Available seat kilometres ASKM million 377,060 368,102 333,726 295,740 271,133 236,645 200,687 182,757 161,756 134,180
Aircraft departures number 201,858 204,543 199,754 181,843 176,039 159,892 142,129 133,772 123,055 109,477
dnata
Consolidated
Financial Traffic
Statements Passengers carried number '000 58,485 56,076 51,853 48,139 44,537 39,391 33,981 31,422 27,454 22,731
Passenger seat kilometres RPKM million 292,221 276,608 255,176 235,498 215,353 188,618 160,446 146,134 126,273 101,762
Additional
Passenger seat factor % 77.5 75.1 76.5 79.6 79.4 79.7 80.0 80.0 78.1 75.8
Information
Cargo carried tonnes '000 2,623 2,577 2,509 2,377 2,250 2,086 1,796 1,767 1,580 1,408
Emirates Ten-Year Overall load carried RTKM million 41,250 39,296 36,931 34,207 31,137 27,621 23,672 22,078 19,063 15,879
Overview Overall load factor % 67.2 65.0 65.5 67.3 66.5 67.5 66.7 68.9 66.8 65.1

dnata Ten Year Employee

Overview
Average employee strength-EK number 62,356 64,768 61,205 56,725 52,516 47,678 42,422 38,797 36,652 35,812
Average employee strength-airline number 49,740 51,628 48,023 44,571 41,471 38,067 33,634 30,258 28,686 28,037
Group Ten-Year
Overview Revenue per airline employee AED '000 1,784 1,580 1,717 1,939 1,938 1,868 1,796 1,738 1,459 1,492

Group Companies
Notes :
of Emirates
1. The ten-year overview has been extracted from the audited financial statements which have been drawn up in compliance with IFRS. New Standards and amendments to existing IFRS have been
Group Companies adopted on the effective dates applicable to Emirates.
of dnata
2. Comparative figures are restated, where applicable, according to IFRS rules i.e. only the immediately preceding year's figures are restated and figures beyond that year have not been amended.
Glossary

Notes :
1. The ten-year overview has been extracted from the audited financial statements which have been drawn up in compliance with IFRS. New Standards and amendments to existing IFRS have been adopted on the
effective dates applicable to Emirates.
2. Comparative figures are restated, where applicable, according to IFRS rules i.e. only the immediately preceding year’s figures are restated and figures beyond that year have not been amended.

183
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2017-18
Consolidated income statement 2017-18 2016-17 2015-16 2014-15 2013-14 2012-13 2011-12 2010-11 2009-10 2008-09
Revenue and other operating income AED m 13,074 12,182 10,630 9,160 7,565 6,622 5,755 4,406 3,160 3,181

Operating costs AED m 11,878 10,958 9,569 8,155 6,702 5,807 4,971 3,906 2,601 2,714
- of which employee costs AED m 5,055 4,654 3,847 3,351 3,251 2,771 2,488 2,032 1,387 1,347
- of which travel services direct costs AED m 2,135 1,913 1,951 1,458 84 n/a n/a n/a n/a n/a
- of which airport operations direct
Overview
AED m 1,293 1,138 949 824 883 798 699 582 442 391
costs
- of which in-flight catering direct cost AED m 843 794 715 735 663 601 451 241 35 40
Emirates

dnata Operating profit AED m 1,196 1,224 1,061 1,005 863 815 784 500 559 467
Group Profit attributable to the Owner AED m 1,317 1,210 1,054 906 829 819 808 576 613 507

Financial
Information Consolidated statement of financial position
Non-current assets AED m 5,718 5,372 4,590 4,219 4,364 3,594 3,759 3,072 1,934 1,984
Emirates
Financial
Current assets AED m 8,574 6,675 6,388 5,427 4,303 3,977 3,360 3,328 2,704 1,963
Commentary - of which cash assets AED m 4,945 3,398 3,465 3,148 2,434 2,396 1,999 2,083 1,982 1,350
Total assets AED m 14,292 12,047 10,978 9,646 8,667 7,571 7,119 6,400 4,638 3,947
dnata
Financial
Commentary
Total equity AED m 7,282 6,706 5,554 4,853 4,756 4,097 3,683 3,282 3,194 2,553
Emirates - of which equity attributable to the Owner AED m 7,103 6,539 5,387 4,788 4,674 4,028 3,614 3,209 3,194 2,553
Consolidated
Financial Non-current liabilities AED m 1,734 1,542 1,362 1,213 1,386 1,351 1,275 1,115 672 697
Statements Current liabilities AED m 5,276 3,799 4,062 3,580 2,525 2,123 2,161 2,003 772 697
dnata
Consolidated Consolidated statement of cash flows
Financial
Statements Cash flow from operating activities AED m 1,858 1,281 1,390 1,058 1,125 1,162 1,167 901 764 481
Cash flow from investing activities AED m (2,157) (961) (1,076) (697) 316 (1,910) (431) (1,333) 391 (71)
Additional
Information Cash flow from financing activities AED m 78 (146) (496) (344) (443) (343) (718) (96) (73) (68)
Net change in cash and cash equivalents AED m (221) 174 (182) 17 998 (1,091) 18 (528) 1,082 342
Emirates Ten-Year
Overview
Other financial data
dnata Ten Year
Overview Cash assets AED m 4,945 3,398 3,465 3,148 2,434 2,396 1,999 2,083 1,982 1,350

Group Ten-Year Notes :

Overview
1. The ten-year overview has been extracted from the audited financial statements which have been drawn up in compliance with IFRS. New Standards and amendments to existing IFRS have been
Group Companies
adopted on the effective dates applicable to dnata.
of Emirates 2. Comparative figures are restated, where applicable, according to IFRS rules i.e. only the immediately preceding year's figures are restated and figures beyond that year have not been amended
3. Travel services direct costs are arising from the acquisitions of Stella Travel in 2014-15 and Gold Medal Travel Group in 2013-14
Group Companies
of dnata

Glossary
Notes :
1. The ten-year overview has been extracted from the audited financial statements which have been drawn up in compliance with IFRS. New Standards and amendments to existing IFRS have been adopted on the
effective dates applicable to dnata.
2. Comparative figures are restated, where applicable, according to IFRS rules i.e. only the immediately preceding year’s figures are restated and figures beyond that year have not been amended.
3. Travel services direct costs are arising from the acquisitions of Stella Travel in 2014-15 and Gold Medal Travel Group in 2013-14.

184
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Key ratios 2017-18 2016-17 2015-16 2014-15 2013-14 2012-13 2011-12 2010-11 2009-10 2008-09
Operating margin % 9.1 10.0 10.0 11.0 11.4 12.3 13.6 11.3 17.7 14.7
Profit margin % 10.1 9.9 9.9 9.9 11.0 12.4 14.0 13.1 19.4 15.9
Return on shareholder's funds % 19.3 20.3 20.7 19.2 19.1 21.4 23.7 18.0 21.3 21.4

Employee
Overview Average employee strength number 41,007 40,978 34,117 27,428 22,980 20,229 18,356 17,971 13,298 12,434

Emirates
Revenue per employee AED '000 319 297 333 399 356 327 322 323 266 256

dnata
Performance Indicators
Group Airport
Financial Aircraft handled number 659,591 623,611 389,412 298,298 288,335 264,950 253,434 232,585 192,120 177,495
Information
Cargo handled tonnes '000 3,083 2,844 2,056 1,671 1,604 1,570 1,543 1,494 1,121 1,003
Emirates Catering
Financial
Commentary Meals uplifted number '000 55,718 60,747 57,062 57,687 41,275 28,584 26,708 11,743

dnata
Travel services
Financial Total transaction value (TTV) AED m 11,281 10,687 11,747 9,782 5,892 5,357 2,630 1,610 1,559
Commentary

Emirates
Consolidated
Financial
Statements

dnata
Consolidated
Financial
Statements
Notes :
Additional
Information 1. The ten-year overview has been extracted from the audited financial statements which have been drawn up in compliance with IFRS. New Standards and amendments to existing IFRS have been
adopted on the effective dates applicable to dnata.
Emirates Ten-Year
Overview 2. Comparative figures are restated, where applicable, according to IFRS rules i.e. only the immediately preceding year's figures are restated and figures beyond that year have not been amended.

dnata Ten Year

Overview

Group Ten-Year
Overview

Group Companies
of Emirates

Group Companies
of dnata

Glossary

Notes :
1.The ten-year overview has been extracted from the audited financial statements which have been drawn up in compliance with IFRS. New Standards and amendments to existing IFRS have been adopted on the
effective dates applicable to dnata.
2.Comparative figures are restated, where applicable, according to IFRS rules i.e. only the immediately preceding year’s figures are restated and figures beyond that year have not been amended

185
 Group ten-year overview
THE EMIRATES GROUP
ANNUAL REPORT

2017-18
Financial highlights 2017-18 2016-17 2015-16 2014-15 2013-14 2012-13 2011-12 2010-11 2009-10 2008-09
Revenue and other operating income* AED m 102,409 94,706 92,896 96,053 87,766 77,536 66,149 57,224 45,405 45,231
Operating costs* AED m 97,127 91,047 83,505 89,155 82,643 73,882 63,552 51,281 41,281 42,486
Operating profit AED m 5,282 3,659 9,391 6,898 5,123 3,654 2,597 5,943 4,124 2,745
Operating margin % 5.2 3.9 10.1 7.2 5.8 4.7 3.9 10.4 9.1 6.1
Profit attributable to the Owner AED m 4,113 2,460 8,179 5,461 4,083 3,102 2,310 5,951 4,151 1,193
Overview Profit margin % 4.0 2.6 8.8 5.7 4.7 4.0 3.5 10.4 9.1 2.6
Dividend AED m 2,000 - 2,500 2,569 1,026 1,000 850 2,208 1,556 2,001
Emirates

dnata Financial position

Group Total assets** AED m 141,625 133,281 129,989 120,886 110,100 102,188 84,127 71,402 60,147 51,358
Cash assets AED m 25,365 19,066 23,453 20,033 18,995 26,968 17,586 16,056 12,493 8,718
Financial
Information
Employee data
Emirates
Financial Average employee strength number 103,363 105,746 95,322 84,153 75,496 67,907 60,778 56,768 49,950 48,246
Commentary
* After eliminating inter company income/expense of the year
dnata ** After eliminating inter company receivables/payables as at year end
Financial
Commentary

Emirates
Consolidated
Financial
Statements

dnata
Consolidated
Financial
Statements

Additional
Information

Emirates Ten-Year
Overview

dnata Ten Year

Overview

Group Ten-Year Notes :

Overview
1.The ten-year overview has been extracted from the audited financial statements which have been drawn up in compliance with IFRS. New Standards and amendments to
Group Companies existing IFRS have been adopted on the effective dates applicable to the Emirates Group.
of Emirates
2.Comparative figures are restated, where applicable, according to IFRS rules i.e. only the immediately preceding year's figures are restated and figures beyond that year
Group Companies have not been amended.
of dnata

Glossary

Notes :
1. The ten-year overview has been extracted from the audited financial statements which have been drawn up in compliance with IFRS. New Standards and amendments to existing IFRS have been adopted on the
effective dates applicable to the Emirates Group.
2. Comparative figures are restated, where applicable, according to IFRS rules i.e. only the immediately preceding year’s figures are restated and figures beyond that year have not been amended.

186
 Group companies of Emirates
THE EMIRATES GROUP
ANNUAL REPORT

2017-18 Hotel operations, food and

Air transportation and related services Catering services Consumer goods beverage operations and others
Emirates Emirates Emirates Emirates
100% Maritime and Mercantile International
100% The High Street LLC (UAE) 90% Emirates Flight Catering Co. (LLC) (UAE) 100% Emirates Hotels (Australia) Pty Ltd
Holding LLC (UAE)

100% Maritime and Mercantile International

100% Transguard Aviation Security LLC (UAE) 100% Emirates Hotel LLC (UAE)
Maldives Pvt Ltd

100% Emirates Land Development Services LLC

50% CAE Flight Training (India) Pvt Ltd 63% Prembev International FZE (UAE) (UAE)
Overview
100% Brand 2 Consumer (Pty) Ltd 100% Emirates Leisure Retail (Holding) LLC
50% CAE Middle East Holdings Ltd (UAE) (South Africa) (UAE)
Emirates

50% CAE Simulation Training Pvt Ltd (India) 100% Queen OS Trading FZE (UAE) 100% Emirates Leisure Retail (Australia) Pty Ltd
dnata

Group 50% Emirates - CAE Flight Training LLC (UAE) 90% Seyvine Ltd (Seychelles) 100% ELRA Properties Pty Ltd (Australia)
100% Hudcom Pty Ltd (Australia)
Financial 100% Hudsons Adelaide Airport Pty Ltd (Australia)
68.7% Maritime and Mercantile International
Information LLC (UAE) 100% Hudsons Airport Launceston Pty Ltd (Australia)
100% Hudsons Albury Pty Ltd (Australia)
Emirates 100% Hudsons Bendigo Pty Ltd (Australia)
Financial 100% Duty Free Dubai Ports FZE (UAE)
Commentary 100% Hudsons Bourke Spring Pty Ltd (Australia)
100% Hudsons Elizabeth (Melb) Pty Ltd (Australia)
100% Harts International LLC (UAE)
dnata 100% Hudsons Epworth Richmond Pty Ltd (Australia)
Financial 100% Hudsons Gawler Pty Ltd (Australia)
Commentary 100% Golden Globe (BVI) Ltd 100% Hudsons George (Bris) Pty Ltd (Australia)
100% Hudsons Grenfell Currie Pty Ltd (Australia)
Emirates
Consolidated 50% Arabian Harts International Ltd 100% Hudsons Hospital Australia Pty Ltd (Australia)
Financial (BVI)* 100% Hudsons Hospitals Nth Adelaide Pty Ltd (Australia)
Statements 100% Hudsons Hospitals S.A. Pty Ltd (Australia)
100% Harts International Retailers (Middle
East) FZE (UAE) 100% Hudsons Hospitals Victoria Pty Ltd (Australia)
dnata 100% Hudsons King William Pty Ltd (Australia)
Consolidated
100% Maritime and Mercantile International 100% Hudsons Launceston Pty Ltd (Australia)
Financial
FZE (UAE) 100% Hudsons Little Collins Flinders Pty Ltd (Australia)
Statements
100% Hudsons Liverpool Pty Ltd (Australia)
Additional 70% Oman United Agencies LLC 100% Hudsons Murray Pty Ltd (Australia)
Information 100% Hudsons Myer Stores Pty Ltd (Australia)
92.5% Sohar Catering & Supplies LLC 100% Hudsons Shepparton Pty Ltd (Australia)
Emirates Ten-Year (Oman)
100% Hudsons WA Airports Pty Ltd (Australia)
Overview
100% Hudsons William Pty Ltd (Australia)
67.1% Onas Trading LLC (Oman)
dnata Ten Year
Overview 100% Emirates Leisure Retail (Singapore)
Pte Ltd
50% Sirocco FZCO (UAE)
Group Ten-Year
100% Emirates Leisure Retail (New Zealand)
Overview
49% Fujairah Maritime and Mercantile Pte Ltd
International LLC (UAE)
Group Companies
of Emirates 68.7% Emirates Leisure Retail LLC (UAE)
50% Focus Brands Ltd (BVI)
Group Companies 100% Community Club Management FZE
of dnata (UAE)
50% MMI Tanzania Ltd
Glossary 51% Premier Inn Hotels LLC (UAE)
49% Independent Wine & Spirit (Thailand)
Co. Ltd
49% Premier Inn Hotels Qatar WLL
40% Zanzibar Maritime and Mercantile
Note: Percentages indicate beneficial interest in the company, legal shareholdings may be different. International Co. Ltd (Tanzania)
The country of incorporation is same as country of principal operations.
*Country of principal operations is UAE. 187
 Group companies of dnata
THE EMIRATES GROUP
ANNUAL REPORT

2017-18
Airport Operations Catering
dnata dnata
100% Dnata Aviation Services Limited (UK) 100% dnata, Inc. (Philippines) 100% Dnata Catering Services Limited (UK)

100% Airline Cleaning Services Pty Ltd 100% dnata Clark Inc. (Philippines) 100% Alpha Flight Group Ltd (UK) 100% En Route International Ltd (UK)
(Australia)

100% Dnata International Airport Services Pte 100% Alpha Flight Services Pty Ltd
100% dnata Aviation Services US Inc. (USA) 100% En Route International Australia Pty Ltd
Ltd (Singapore) (Australia)
Overview
100% ALX Cargo Centre IAH LLC (USA) 100% CIAS International Pte Ltd (Singapore) 100% Alpha ATS Pty Ltd (Australia) 100% En Route International General Trading
LLC (UAE)
Emirates

100% dnata Aviation USA Inc. 100% dnata Singapore Pte Ltd (Singapore)* 100% Alpha Flight US Inc. 100% En Route International Japan Ltd
dnata

100% Ground Services International Inc. 20% Guangzhou Baiyun International 100% En Route International Limited
Group 100% Alpha In-flight US LLC
(USA) Airport Ground Handling Services Co. Ltd (Hong Kong)
(P. R. China)
Financial 100% Dnata Catering Canada Limited 100% En Route International South Africa
Information 100% Metro Air Service Inc. (USA)
75% Guangzhou Baiyun International (Canada) (Pty) Ltd
Airport Facilities Management &
Emirates
Operation Corp Ltd (P. R. China) 100% dnata Catering Ireland Ltd
100% dnata BV (The Netherlands) 100% En Route International USA, Inc.
Financial (Ireland)
Commentary
70% Guangzhou Baiyun International 50% Mountainfield Investments (Pty) Ltd
100% dnata Limited (UK) Airport Cleaning Services Corp Ltd 100% dnata srl (Italy)
dnata (South Africa)
(P. R. China)
Financial
Commentary 100% dnata Cargo Limited (UK) 80% Alpha Flight a.s. (Czech Republic) 100% dnata Newrest (Pty) Ltd (South Africa)
95% Air Dispatch (CLC) s.r.o. (Czech Republic)
Emirates
Consolidated 100% dnata Ground Limited (UK) 64.2% dnata Catering srl (Romania)
Financial 100% Air Dispatch (CLC) Spolka z.o.o. (Poland)
Statements
22.6% Airports Bureau Systems Ltd (UK) 80% Dnata Airport Services Kurdistan 50% Alpha LSG Ltd (UK)
dnata (Cayman Islands)
Consolidated
Financial 100% dnata Pty Ltd (Australia) 100% Dnata for Airport Services Ltd 100% Alpha Flight UK Ltd
Statements (Kurdistan, Iraq)
100% dnata Airport Services Pty Ltd.
Additional 49% Alpha Flight Services UAE LLC
(Australia) 50% Gerry’s Dnata (Private) Ltd (Pakistan)
Information
100% Airport Handling Services Australia 35.9% Jordan Flight Catering Company Ltd
Emirates Ten-Year Pty Ltd
Overview
100% dnata Aviation Services Canada Limited 28.7% Silver Wings OOD (Bulgaria)
dnata Ten Year
Overview
50% G.T.A. Dnata Ground Handling Limited 99.2% Consortium Alpha DZZD
(Canada) (Bulgaria)
Group Ten-Year
Overview
50% G.T.A. Dnata World Cargo Limited
(Canada)
Group Companies
of Emirates
100% Dnata Switzerland AG
Group Companies
of dnata
30% GVAssistance SA (Switzerland)
Glossary
70% RM Servicos Auxilliares de Transporte
Aereo S/A (Brazil)

30% Airport Handling SpA (Italy)

Note: Percentages indicate beneficial interest in the company, legal shareholdings may be different.
The country of incorporation is same as country of principal operations.
188 * Also provides catering services
 Group companies of dnata
THE EMIRATES GROUP
ANNUAL REPORT

2017-18
Travel services Freight forwarding services
dnata / dnata World Travel dnata / dnata World Travel dnata
100% Cleopatra International Travel WLL 100% Maritime and Mercantile International 100% dnata Aviation Services Holdings Limited 50% Dnata-PWC Airport Logistics LLC (UAE)
(Bahrain) Travel LLC (UAE)

100% dnata International Private Ltd (India) 76.9% Oman United Agencies Travel LLC 100% Destination Asia (Singapore) Pte Limited 50% Dubai Express LLC (UAE)

100% Sama Travel & Services International

100% dnata Marketing Services Pvt Ltd (India) 45% PT Destinasi Asia Indonesia 50% Freightworks Logistics LLC (UAE)
LLC (Oman)
Overview
100% dnata Travel and Tourism WLL 29% Destination Asia Destination
50% Moon Travel LLC (Oman) 25.5% Bolloré Logistics LLC (UAE)
(Bahrain) Management Sdn Bhd (Malaysia)
Emirates

100% dnata Travel Holdings UK Limited 100% Najm Travel LLC (UAE)* 25% Destination Asia Ltd (Hong Kong)
dnata
Others
25% Destination Group Asia (Hong Kong)
Group 100% Gold Medal International Limited (UK) 100% Travel Partners LLC (UAE) Limited dnata
Financial 100% Travel Partners Iberian, Sociedad
Information 100% Airline Network plc (UK) 25% PT Destination Asia (Indonesia) 100% Plafond Fit Out LLC (UAE)
Limitada (Spain)
Emirates 25% DMC Management Asia Services Limited 100% Transecure LLC (UAE)
100% Gold Medal Travel Group plc (UK) 100% Travel Partners (London) Limited (UK)
Financial (Hong Kong)
Commentary

100% Gold Medal Transport Ltd (UK) 75% Super Bus Tourism LLC (UAE) 25% Destination Asia (Thailand) Limited 50% Transguard Group LLC (UAE)
dnata
Financial
Commentary 70% dnata Travel Company Limited (Saudi 100% CASS International General Trading LLC
100% Stella Global UK Limited 25% Destination Asia (Vietnam) Limited (UAE)
Arabia)
Emirates
Consolidated 25% Huan Ya Feng Jing International 50% Transguard Cash LLC (UAE)
100% The Global Travel Group Limited (UK) 50% G Travel International LLC (UAE)
Financial Company Limited (China)
Statements
100% Personalised Travel Services Limited 25% DMC Asia Management Services Limited 100% Transguard Group International LLC
51% Imagine Enterprises Limited (UK) (UAE)
(UK) (Hong Kong)
dnata
Consolidated
100% Holiday Planet PTY Ltd 100% Transguard Group Cash KSA LLC (UAE)
Financial 100% Sunmaster Limited (UK) 25% Destination Asia Japan Limited
(Australia)
Statements
51% Transguard Group International LLC
Additional 100% Stella Travel Services (UK) Limited 100% Imagine Cruising Limited (UK) (Oman)
Information

100% Travel 2 Limited (UK) 100% Imagine Transport Limited (UK) 9.1% Canary Topco Ltd (UK)
Emirates Ten-Year
Overview
100% Travelbag Limited (UK) 100% Imagine Cruising Pty Ltd (Australia)
dnata Ten Year
Overview
100% Imagine Cruising (Pty) Ltd (South
100% dnata Travel Inc. (Philippines) Africa)
Group Ten-Year
Overview
50% Al Tawfeeq Travel (Dnata Travel) WLL
100% Dnata Travel (UK) Limited (Qatar)
Group Companies
of Emirates
100% dnata World Travel Limited (UK) 50% Dunya Travel LLC (UAE)
Group Companies
of dnata 100% Travel Technology Investments Limited 100% Dunya Air Services LLC (UAE)
(UK)
Glossary
100% Travel Republic Holdings Limited (UK) 50% Najm Travels LLC (Afghanistan)

100% Travel Republic Limited (UK) 50% Travel Counsellors LLC (UAE)
Note: Percentages indicate beneficial interest in the company, legal shareholdings may be different.
The country of incorporation is same as country of principal operations.
22% Hogg Robinson Group Plc (UK) *Country of principal operations is Iraq. 189
 Glossary
THE EMIRATES GROUP
ANNUAL REPORT

2017-18

A E O T

Acquisitions – The sum of purchase EBITDAR – Operating profit before Operating cash margin – Cash Total revenue – Sum of revenue and
consideration for acquisition of depreciation, amortisation and aircraft generated from operating activities other operating income.
subsidiaries and investments made in operating lease rentals. expressed as a percentage of the sum of
Total transaction value – The sum of
associates and joint ventures. revenue and other operating income.
EBITDAR margin – EBITDAR expressed gross revenue from agency and package
Overview ASKM (Available Seat Kilometre) – as a percentage of the sum of revenue Operating margin – Operating profit sales, net of government taxes.
Passenger seat capacity measured in and other operating income. expressed as a percentage of the sum of
Emirates Traffic – see RTKM
seats available multiplied by the distance revenue and other operating income.
Equity ratio – Total equity divided by
dnata flown. Transport revenue – The sum of
total assets. Overall load factor – RTKM divided by
passenger, cargo and excess baggage
Group ATKM (Available Tonne Kilometre) ATKM.
F revenue.
– Overall capacity measured in tonnes
Financial P
available for carriage of passengers
Information
Fixed to floating debt mix – Ratio of U
and cargo load multiplied by the
Emirates distance flown. fixed rate debt to floating rate debt. Passenger seat factor – RPKM divided
Unit cost (Fils per ATKM) – Operating costs
Financial The ratio is based on net debt including by ASKM.
Commentary (airline only) incurred per ATKM.
B aircraft operating leases.
Passenger yield (Fils per RPKM) –
dnata
Free cash flow – Cash generated from Passenger revenue divided by RPKM. Y
Financial Breakeven load factor – The load factor
Commentary operating activities less cash used in
at which revenue will equal operating Profit margin – Profit attributable to the Yield (Fils per RTKM) – Revenue (airline
investing actvities adjusted for the
Emirates costs. Owner expressed as a percentage of sum only) earned per RTKM.
Consolidated
movement in short term bank deposits.
of revenue and other operating income.
Financial
Statements
C Freight yield (Fils per FTKM) – Cargo
revenue divided by FTKM. R
dnata Capacity – see ATKM
Consolidated FTKM - Cargo tonnage uplifted Return on shareholder’s funds – Profit
Financial Capital expenditure – The sum
Statements multiplied by the distance carried. attributable to the Owner expressed as a
of additions to property, plant and
percentage of shareholder’s funds.
Additional equipment and intangible assets N
Information excluding goodwill. RPKM (Revenue Passenger Kilometre)
Net debt – Borrowings and lease – Number of passengers carried
Emirates Ten-Year Capitalised value of aircraft operating
Overview liabilities (current and non-current) net multiplied by the distance flown.
lease costs – 60% of future minimum
of cash assets.
dnata Ten Year lease payments for aircraft on operating RTKM (Revenue Tonne Kilometre) –
Overview lease. Net debt to equity ratio – Net debt in Actual traffic load (passenger and cargo)
relation to total equity. carried measured in terms of tonnes
Group Ten-Year Cash assets – The sum of short term
Overview multiplied by the distance flown.
bank deposits and cash and cash Net debt including aircraft operating
equivalents. leases - The sum of net debt and the
Group Companies S
of Emirates capitalised value of aircraft operating
D lease costs. Shareholder’s funds – Average of
Group Companies
of dnata opening and closing equity attributable
Dividend payout ratio – Dividend
to the Owner.
Glossary accruing to the Owner divided by profit
attributable to the Owner.

190
Emirates P.O. Box 686, Dubai, United Arab Emirates, emirates.com
dnata P.O. Box 1515, Dubai, United Arab Emirates, dnata.com

ekgroup.com