Budget carrier Air Arabia posts first quarterly loss

Air Arabia, the Middle East's largest low-cost airline, announced on Thursday its first-ever quarterly loss, blaming challenging market conditions and overcapacity.The UAE carrier reported a net loss of 33mn dirhams ($9mn) in the last three months of 2016, while revenue dropped 15% to 814mn dirhams.Earnings of the Sharjah-based carrier "were impacted by (a) continuous drop in yield margins as a result of the overcapacity deployed in the market and the slow growth environment in major economic hubs," said Air Arabia chairman Sheikh Abdullah al-Thani.He warned that market conditions "continue to be challenging."It is the first quarterly loss on record for Air Arabia, according to Bloomberg News. The airline's shares tumbled 8.6% on Thursday on the Dubai stock exchange, the largest drop since March 2013, Bloomberg said.Air Arabia's annual profit dropped 4% to 509mn dirhams ($138.7mn) in 2016, although passenger numbers increased 12% to 8.4mn.The airline, which began operations from the emirate of Sharjah in 2003, now also has hubs in Egypt, Jordan and Morocco. It operates a fleet of 46 narrow-body Airbus A320s serving some 124 destinations.