Aer Lingus sees €30.4m profit despite ‘difficult year’
Irish airline Aer Lingus said today that despite 2010 being a difficult year, it turned its business around and made profits of €56.7m, compared to an operating loss of €154.8m in 2009.
The airline said that its changed business strategy led to the turnaround, despite economic conditions. Average yields per passenger were up 12pc and operating profit was up to €56.7m.
The airline’s transatlantic business returned to profitability and the Greenfield agreement delivered over €41m in savings.
However, all was not good news in the company’s full-year results’ statement this morning. Passenger numbers were down 10pc for the year, which Aer Lingus said was due to the negative impact of the volcanic ash cloud and December’s weather disruptions.
Chief executive, Christoph Mueller said the result represents a “swing in profitability of €138.6m compared to 2009”. He added that it had been “achieved despite adverse economic conditions in our core Irish market and significant operational challenges caused by volcanic ash and weather related disruptions in 2010”.
However, the company’s outlook for 2011 is somewhat bleak due to rising fuel costs.
“We expect significant challenges in 2011, with trading for the year likely to be impacted by fuel price inflation and increased airport charges in combination with difficult conditions in our home market.
“We do not expect that improvements in yield performance and ongoing cost savings can offset these increased costs. If current fuel prices persist, we expect that 2011 operating profit will be significantly below that of 2010,” warned Mueller.
The 2010 results were also marred by an exceptional provision of €32.5m for the estimated cost of a settlement with the Irish Revenue Commissioners for taxation arising from a redundancy scheme negotiated in 2008 and implemented in 2009.