Ramesh Cidambi tells TRBusiness that DDF is likely to report a -4% decline in sales for 2016, impacted by a weakness in emerging market currencies and – more recently – the sterling, following Brexit. However, ‘a good performance in September’ has been encouraging, he says.

 

At this morning’s Meadfa conference the company’s Executive Vice Chairman, Colm McLoughlin told the audience that sales are down -3% currently (or AED 195m). [Follow the TRBusiness twitter feed for live reporting from the conference].

 

Former Dubai Duty Free President, George Horan, told TRBusiness in April this year that despite the turbulent 2015 and 2016 conditions, he hoped that the company’s $2bn sales target was still feasible.

 

However, weakness in many emerging market currencies has continued to pose problems for the company, which has suffered acutely from unfavourable exchange rates between the euro and the US dollar as well as the rouble devaluation.

 

When TRBusiness spoke with the current Chief Operating Officer, Ramesh Cidambi his sales estimates were more conservative for 2016, as he forecasts a decline of 3 to 4% for the year.

 

“We were targeting $2bn in 2016, but given the trading conditions during the year – and even if we do have a strong finish to the year from October to December – it’s unlikely that we’ll hit the two billion dollar mark.

 

“Our own view is that we’ll probably be shy of the mark by between 3-4% this year, which we think is a good performance in light of the difficulties that the region has seen; the difficulties that the travel industry has seen and in relation to the overall growth in the business.”

 

 

Of course this may mean that DDF will have to pass on its title as the number one airport retailer (by DF&TR sales in one location), back to Incheon Airport at the start of next year, but this is something which Cidambi isn’t too worried about.

 

“What we need to do as a business is to increase the spend per passenger and to increase the business overall; increase in revenue and be the best that we can in terms of what we do.

 

“Sometime in the middle of next year or in the third quarter of next year when Generation [Research] finishes compiling the results, we will see what it is. Generally we have plus- or-minus about $50m with Incheon Airport which competes with us for the for the number one title.”

 

Dubai Duty Free has made no secret of the challenges it has faced over the last couple of years and unfortunately the company is yet to see any significant improvements this year.

 

“We are definitely continuing to feel the pain with the weakness in emerging market currencies this year – all the way from the Brazilian real to the New Zealand dollar – plus the weakness in the euro, in addition to the weakness of the Chinese currency.”

 

Read the full-length interview in the November issue of TRBusiness.