Aer Lingus plans to cut 100 jobs through
voluntary redundancies it announced today in
an interim management statement. The airline said the performance for the
first three months of the year highlighted the need to continue to review its
cost base to protect profitability for the rest of 2013 and beyond. It had a
strong performance on the long haul network.
On short haul, a 0.9% increase in average fares
offset the 0.5% decline in passengers for a 0.4% increase in revenue. In
contrast, long haul revenue was up over 14% as fares increased by 5.6% in
addition to the 8.4% rise in passengers.
Revenue for the first three months of 2013 rose
by 3.3% €259.7m while leisure passenger numbers were boosted by the timing of
Easter, with the Easter bank holiday weekend falling into March 2013 compared to
the start of April in 2012.
The airline said it had an operating loss before
exceptional items of €45.5m for the three month period, down from a loss of
€36.1m the same time last year. It normally incurs a loss in the low-season
Total passenger numbers rose 2.2% and the
overall yield per passenger increased by 3.7%.
Stephen Furlong of Davy commented
- - "DAVY VIEW: Q1 2013 operating loss, before exceptional
items, of €45.5m is €9.4m higher than the prior year largely due to Virgin
wet-lease start-up costs, planned changes to the long-haul fleet and slightly
weaker trading on UK routes. Outlook is for 2013 operating profit, before
exceptional items, to be broadly in line with last year – €69.1m (Davy: €80.3m).
We are likely to adjust forecasts downwards accordingly. An analyst call will
take place at 0830 GMT (Dublin: +353 1 4364265; London: +44 208 8179301). Q1 revenue up 3.3% but operating profit behind by €9.4m
Q1 2013 revenue was 3.3% ahead of the prior year with total passengers
(including Aer Lingus Regional) up 2.2% year-on-year (yoy). Fare revenue per
seat was 6.5% higher yoy with short haul up 3.3% and long haul up 10.4%.Overall,
passenger yield was up 3.7% with load factor up 2.7 percentage points to 71.4%.
Long-haul yield and load factor performance were particularly strong, increasing
by 5.6% and 3.4 percentage points respectively.
Q1 2013 operating loss, before exceptional items, of €45.5m is €9.4m higher than
the prior year largely due to Virgin wet-lease start-up costs, planned changes
to the long-haul fleet and slightly weaker trading on UK routes.
Cautious outlook; profits forecast to be in line with prior year
Long-haul capacity in summer 2013 will be higher than in 2012 due to the
additional A330 aircraft, which will expand services to Boston and Chicago.
Short-haul capacity will be lower as a result of changes to the route network
and the impact of lower gauge A319 aircraft operating certain short-haul
With limited visibility over booking patterns for the second half of 2013, Aer
Lingus commented that 'our present level of total bookings for the remainder of
2013 is ahead of the equivalent level at this time last year. The indications
are that the long haul market is strong enough to absorb the additional capacity
we have introduced. Trends identified in Q1 2013, including higher airport
charges, the strength of long haul and the softness in GBP and our UK market
have the potential to remain a feature for the rest of the year. On that basis,
we currently expect 2013 operating profit, before exceptional items, to be
broadly in line with last year.' On the UK, we believe that incremental capacity
from BA/bmi out of Heathrow caps unit revenue.
Commercially, an interesting development is the damp leasing of three B757 to
operate on the North Atlantic service starting in early 2014 and also the wet
lease of an A330 to Nova Airlines over the next two winters."
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