Aer Lingus today reported an operating loss of €93m in H1 2009 - - the first six months of the year. This compares to a loss of €23.4m the same time last year. Its revenue dipped by 12.2% to €555m.
Half yearly pre-tax losses increased to €81.7m from €21.3m in the same period last year.
Aer Lingus said it total passengers rose by 1.7% to a total of 4.943 million in the six months period. Seven routes were cancelled while capacity was reduced on 24 routes.
The former State airline said that average fares for the six month period fell by 17.1% on 2008. This represented a 13.1% fall in short haul fares and an 18.5% fall on long haul fares. Fuel costs rose by 10% to €189.6m in the six month period.
The airline said active management of capacity has been deployed to meet changing environment, with long haul capacity reduced by 18.1%, while short haul capacity increased by 4.3% largely due to new operations at London Gatwick offset by a decrease in Irish short haul capacity of 4.0%. Further reductions in capacity are planned for Winter 09/10, with seat capacity on short haul routes from Dublin reducing by 14% and seat capacity on long haul routes reducing by 24%.
A cost reduction programme announced in December 2008 will yield savings of €65m for the financial year 2009, with the full year benefit of staff cost savings to come in 2010; there has recently been an greement with Airbus on deferral of aircraft deliveries resulting in significant reduction in medium term capital commitments and a new CEO, Christoph Mueller, will start on 1 September 2009 and will execute the strategy to return the business to profitability.
Aer Lingus said trading conditions continue to be very challenging across the airline industry. There has been a structural change in fares and in demand for long haul business class product in particular. In addition, Aer Lingus expects that the continuation of the current market trends in Ireland and its other key markets will lead to further sustained and significant fare pressure. This dynamic and very challenging environment contributes to a highly uncertain outlook.
