Aer Lingus slashes losses in first half of the year
Aer Lingus said yesterday it was aiming for profit by the end of the year after announcing it had slashed its losses in the first part of 2010.
“We are flying less but flying more profitably,” said communications director Declan Kearney yesterday.
The airline, which is in the middle of a difficult cost-cutting programme, suffered EURO19 million (15.5m) losses for the six months to the end of June.
Chief executive Christoph Mueller said the improvements were significant despite difficulties caused by the Icelandic volcanic ash crisis and sluggish markets.
“Despite the group’s strong commercial performance, Aer Lingus has not been complacent in addressing its cost position,” he said.
“The group remains committed to implementing all aspects of the Greenfield Cost Reduction Programme in order to position Aer Lingus for a successful future.”
Mr Mueller added: “For the 2010 full year, we expect to report an operating performance (before exceptional items) of no worse than break-even.
“This would represent a good performance in difficult market conditions but is predicated on the delivery of committed staff productivity savings and no further significant disruptions to operations from industrial action or airspace closures.”
The privatised former national carrier has continued to operate successfully from its UK hub at Belfast International Airport and carried a total of 4.4 million passengers in the first half of the year.
That was half a million fewer than the same time last year, but the firm managed to reduce losses by 80 per cent from EURO93 million (75.9m) in January to June 2009 to EURO19 million (15.5m) this year.
Speaking to the News Letter at the end of July, Mr Mueller said the business had been through a difficult time but was back on track.
“We are on a trajectory – we are making good progress in restructuring the company. “We had a good first quarter and we had a good April and May despite the Volcanic ash crisis.
“Because our performance in April and May was generally strong, we have been able to compensate for the impact. It will not have a significant impact on our full year results.”
Mr Kearney said the firm had pursued a rigorous cost cutting exercise which has yet to be completely carried through.
“We are happy that our Greenfield programme was agreed a number of months ago. It’s a radical restructuring programme in terms of the cost base of the business and we still have some elements of it to be finalised at moment. We have issues for instance with the cabin crew union but those are not insurmountable and there are also big cost savings on fuel and overall savings from taking out capacity.
“We are saying that we will be no worse than break-even by the end of the year.
“We would hope to make an operating profit this year which would be a major turnaround.”
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Tuesday 14 February 2012
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