UAE. Dubai Duty Free sales climbed by +4% year-on-year in the first six weeks of 2017, with February sales to date increasing by +5.1%. That’s according to Executive Vice Chairman and CEO Colm McLoughlin, speaking to The Moodie Davitt Report at company headquarters in Dubai.
McLoughlin said: “In our case a rise of +4% is AED33 million (US$9 million), which is significant, so we’re happy with the performance so far. It is an encouraging start to the year.”
He added: “Our sales were down by -3% last year, compared to 2015, and for the full year we have budgeted an increase a little ahead of 2016.”
Although Dubai Duty Free sales dipped last year, the company managed to improve its profitability, noted McLoughlin.
“We took action to make sure our bottom line was protected and profitability was actually up by +3% against 2015.”
The company continues to be affected by the weakness of currencies such as the Euro and Sterling against the Dollar, McLoughlin acknowledged, and Dubai Duty Free continues to work to mitigate the impact.
“We have had cooperation from our suppliers who are paid in US Dollars and many more of them are reflecting their currency gains with us now.
“Traffic through Dubai International is helping top line sales too. Last year passenger traffic was 84 million and this year 91 million passengers are expected. That is a positive but more traffic generally means less time to shop and adds to congestion. Also, we are seeing more airlines taking steps to restrict the amount of hand luggage that travellers can take onboard. That is an issue.”
Dubai Duty Free continues to invest in expanding and improving its stores at the airport. In a link connector area between concourse B and C it has opened 1,300sq m of new space.
McLoughlin said: “The stock in this area repeats the offer elsewhere but is an important addition. There is a lot of work in Concourse C with some new areas to come on stream later in the year. Concourse D is also performing well.
“In Concourse B we have cleared the centre aisles and that has eased traffic flow considerably. We have noticed the benefits in the numbers of passengers shopping. That is important to us.”
*The full interview with Colm McLoughlin will feature in the next edition of Moodie Davitt Interactive, which combines the best of print and digital.
