Etihad's seat factor fell slightly to 72.7 percent from 75.1 percent during the same period in 2010, the airline said in a statement.
"This quarter saw unrest in a number of Middle East countries, which has clearly resulted in lower traffic into those markets," said James Hogan, Etihad Airways' chief executive officer, adding that the earthquake in Japan also had an impact on business.
Hogan said the airline is cautiously positive even as fuel prices continue to rise.
"Fuel prices will be a major challenge for the airline industry this year but I am glad to report that Etihad has hedged more than 75 per cent of its fuel requirements for 2011."
Etihad said cargo revenue grew by 44 per cent year on year.
UAE's other airline Emirates said last month that unrest in the Middle East and northern Africa could hit revenue by 3 to 5 percent. (Reuters)
