Power Letters 2022: Colm McLoughlin, executive vice chairman and CEO, Dubai Duty Free

2021 started very well for Dubai Duty Free and despite the challenges of the pandemic, we achieved some great results, including returning to profitability in January, as well as expanding our retail operation.

From January until mid-December 2021, our sales reached $911m, which is 40 per cent higher than the same period in 2020 although 52 per cent lower than sales in 2019, which was a record year. Currently, sales are more than 10 per cent above passenger numbers and spend per head increased to around $54 vs $39 in 2019. This is due to a number of factors, including the pent-up demand from people who may be travelling for the first time since the outbreak of Covid-19.

With Dubai International Airport returning to 100 per cent capacity in November, Dubai Duty Free is now fully operational (apart from Al Maktoum International Airport which remains closed) with about 134 stores open. These include the opening of the forecourt public shop at Terminal 3 in April and a new 100sqm Christian Dior in Concourse B in October. Two more luxury boutiques will be opening in the coming weeks, including a second Christian Dior in Concourse A and a 254sqm Louis Vuitton shop in Concourse B, which we are very excited about.

The Airport Council International (ACI) forecast that global passenger traffic volume in 2021 would reach half of what it was in 2019 with traffic for 2021 totaling only 4.6 billion of the 9.2 billion passengers served two years ago. Despite a delayed recovery as compared to earlier forecasts, the trend of gradual reopening brings a renewed optimism that air travel could see an uptick in 2022, moving the travel retail industry closer to its recovery. Although there are still many bumps in the road to full recovery with the emergence of new Covid-19 variants such as delta and omicron, overall the broad trend is onward and upward.

Looking ahead to 2022 and beyond, we are very optimistic from the larger business perspective. We have now recalled 1,500 employees, bringing our workforce back to over 3,800. Regarding store development, we never took our foot off the accelerator during the pandemic and continued to work on several projects to enhance our operations and provide more shopping experiences for our customers.

2022 will be defined by a stronger and broad-based recovery, with a better revenue stream, a better feeling in terms of the employees and some amount of redevelopment both in stores and in certain categories. Dubai International Airport is forecasting around 56 million passengers and we expect our revenue to continue to grow in line with that or slightly ahead of the passenger growth.

Our industry has always been resilient, we’ve faced major challenges over the years, and I have to say that I was heartened by the way our staff and the wider industry has pulled together since the start of the pandemic. While we have to be realistic and acknowledge that it is going to take time for things to come back to where we used to be, we are determined to make Dubai Duty Free a ‘re-success’.