Qatar Airways blamed what it calls the illegal blockade of its country by a Saudi-led coalition of Gulf states for the past fiscal year’s deteriorated financial position, reflected by a net loss of 252 million rials ($69 million) during the period. Calling 2018 the most challenging year in its 20-year history, the airline nevertheless managed to increase revenue by 7.22 percent, thanks largely to a 34.4 percent gain in cargo revenue. While capacity growth moderated to 9.96 percent, Qatar directly attributed its lower revenue growth to the blockade that took effect on June 5, 2017, which resulted in a 19-percent drop in departing seats.

Qatar replaced 18 mature routes it closed due to the blockade with 14 new destinations during the fiscal year, resulting in an increase of 24 new destinations since June 5 of last year. Its $69 million loss, it said, resulted from the launch costs associated with new destinations and the need to establish market presence. Still, with positive operating cash flow, the group’s cash position remained strong at 13.312 billion reals ($3.637 billion), reported Qatar.

Within 10 weeks of the blockade’s establishment, Qatar launched new destinations to Sohar, Prague, and Kiev, while other routes saw an increase in frequency and capacity. During the financial year the group also continued expanding its investment portfolio to include an initial 9.94 percent stake in Cathay Pacific, which has since increased to 9.99 percent, as well as a 49 percent share of AQA Holding, the parent company of Meridiana fly, re-launched as Air Italy in February 2018.  

“This turbulent year has inevitably had an impact on our financial results, which reflect the negative effect the illegal blockade has had on our airline,” said Qatar Airways CEO Akbar Al Baker. “However, I am pleased to say that thanks to our robust business planning, swift actions in the face of the crisis, our passenger-focused solutions, and dedicated staff, the impact has been minimized—and has certainly not been as negative as our neighboring countries may have hoped for.”