Following the airline’s announcement, Stephen Furlong, aviation analyst at Irish stockbroker Davy, told the
FT he was now forecasting an operating loss close to €100m, versus the €41.9m he expected previously.
In its first quarter trading statement Aer Lingus also said revenues declined by 16% year-on-year, after passenger numbers fell 6.5% to 2.09m. The fall comprised a 5.7% decrease in short-haul and a 12.5% decrease in long-haul passengers.
Total revenue per passenger was down 9.6%.
Capacity in available seat kilometres declined by 4.5% on short-haul and 19.5% on long haul-routes, with the cut helping to lift load factors by 2.4 percentage points overall. Short-haul loads were up 1.4pp at 70.1 % and long-haul up 3.2pp at 67.1%.
Yields ‘reflected the poor market conditions and weakening economic environment’.
Average short-haul fares fell by 1.6% in January and February but by 23.6% in March, taking the decline for the quarter to 10.8% year-on-year. The decline was partly offset by a 14.5% increase in ancillary revenue per passenger.
Average long-haul fares were 14% lower in January/February but fell by 25.7% in March, taking the reverse for the quarter to 18.9%.
Aer Lingus said that while the lower March figures could partly be attributed to the effect of Easter moving to April, ‘it is clear that the yield environment has worsened, particularly in Ireland, as the year has progressed’.
Total yields for the first quarter were down 14.5% year-on-year.
Aer Lingus also announced a re-organisation of its senior management structure to align it more closely with the group's objective of ‘maximising revenues and reducing costs in an exceptionally challenging operating environment’.
Niall Walsh has been named chief operating officer, while Sean Coyle, chief financial officer, has been appointed head of short-haul operations, and Stephen Kavanagh, corporate planning director, head of long-haul operations.
Coyle and Kavanagh have assumed these responsibilities in addition to their existing roles.
See also:
Mannion leaves Aer Lingus (06/04/2009)
Recession hits airlines’ profits [FY08] (11/03/2009)
Aer Lingus execs forego golden handshakes (12/01/2009)
Irish departure tax to cost Aer Lingus €30m (12/11/2008)