DUBAI, United Arab Emirates – Qatar Airways announced on Sunday its net profits rose to $540 million in its latest financial disclosure before the airline took a hit and was blocked from flying to major Arab states.
The carrier, which marks its 20th anniversary this year and is one of the Middle East’s biggest airlines, said revenue rose last year from $9.6 billion to $10.6 billion in the fiscal year ending March 31. Its net profits in 2016 stood at around $445 million.
Analysts estimate that a political standoff between Qatar and other Arab states will cost the airline heavily. Last week, Saudi Arabia, the United Arab Emirates, Egypt and Bahrain cut ties with Qatar and blocked direct flights with the country.
Qatar Airways also stopped its flights to the four Arab countries in response to the UAE’s Etihad, Emirates, FlyDubai, EgyptAir and Bahrain’s Gulf Air suspending flights to Qatar.
Qatar’s new and state-of-the-art Hamad International Airport in Doha serves as a major transit hub for some 37 million passengers a year, largely between Europe and Asia. The cancelled flights impact many of the airline’s travelers who fly via to Doha to international destinations.
Additionally, Qatar Airways is now using longer routes to its European and North American destinations, including direct flights to the world’s busiest international airport in Atlanta, after Saudi Arabia, the UAE and Egypt barred Qatari flights from their airspace.
Qatar Airways CEO Akbar al-Baker acknowledged the measures in a statement in the company’s annual fiscal report.
“Qatar Airways continues to operate to the rest of its network as per its published schedules with day-to-day adjustments for operational and commercial efficiencies,” he said, without elaborating further.
The airline, which has one of the world’s most modern fleets and an array of premium services, flies to more than 150 destinations. It added 10 new destinations last year.
The political storm surrounding Qatar is impacting life and business in one of the world’s biggest natural gas producers and travel hubs, which is preparing to host soccer’s World Cup in 2022.
The four Arab countries accuse it of supporting terror groups in the region, interfering in their sovereign affairs and backing groups that undermine political stability. Qatar says it denounces terrorism and that the moves to isolate it are politically motivated.