Aer Lingus reports third quarter operating profit of €90.9m

Wednesday 07 November 2012 10.49
Aer Lingus reports ''strong'' operating profits in third quarter
Aer Lingus reports ''strong'' operating profits in third quarter

Aer Lingus has reported operating profits of €90.9m for the three months to September, down 2.9% on the €93.6m reported the same time last year.

In an interim management statement, it said the ''strong' result was achieved despite weaker business demand on core London routes during the Olympics and fuel and airport charges inflation.

Revenues for the three month period rose by 2.8% to €275.9m from €268.3m the same time last year.

The airline noted that fuel costs jumped almost 28% to €106.9m while staff costs inched 1% higher to €69.9m.

Aer Lingus said its passenger revenue for the third quarter was 5.5% ahead of the third quarter in 2011, on the back of positive variances in yield and load factor.

The airline's total passenger numbers in the third quarter (including Aer Lingus Regional) increased by 2%, while the overall yield per passenger increased by 7.2%. It noted that long haul yields remained particularly strong, increasing by 11.5% on the previous year.

Aer Lingus said it ''over-achieved'' on its Greenfield cost cutting programme target with more than €100m in annual savings. It also paid its first dividend to shareholders during the three month period.

The airline said that operating profits for the year to date are now €86.5m, 29.7% ahead of the same time last year.

"The positive result reflects the on-going success of our strategy to manage capacity deployment across the network, concentrating on serving higher yielding, time sensitive demand and continuing to focus on cost reduction. I am particularly proud that our team has achieved this result against the backdrop of the third Ryanair offer for the group,'' commented Aer Lingus chief executive Christoph Mueller.

''Overall, this strong Q3 result follows on from a solid 2012 first half performance. We remain focused on achieving continued cost savings and greater efficiency within the business against a challenging macro-economic backdrop, an increasingly competitive environment and continued inflation in fuel prices and airport charges,'' he added.

The Aer Lingus CEO said that forward bookings at the end of the third were stronger than in the same period last year and due to increased demand, an additional aircraft is required to serve its long haul network on the North Atlantic.

But the airline was unable to provide an outlook due to Irish takeover rules.

Aer Lingus said it has spent €2.3m on advisory, legal and other fees related to Ryanair's third offer for the group during the third quarter. In total, it incurred €4.9m of exceptional items in the third quarter of 2012 compared to €0.1m the same time last year. As well as the Ryanair costs, it spent €2.3m on redundancy and other restructuring costs.