Aer Lingus reports quarterly loss of €36.1m

AER LINGUS made a loss of €36.1 million for the first quarter of this year. This was a 38 per cent improvement on the same period in 2011, which was adversely affected by industrial action that cost the airline €15 million.

The quarterly performance was boosted by strong long-haul revenue, which rose by 24.6 per cent to €52.7 million.

“Long-haul performance, especially in the business-class cabin, was particularly positive, with both load factors and yield well above prior year,” Aer Lingus said in an interim statement.

The first quarter is traditionally a loss-making period for the airline, and for other carriers, due to seasonality.

Aer Lingus’s total revenue increased by 15.4 per cent to €251 million in the three months to the end of March, while its total operating costs rose by 5.9 per cent to €287.6 million.

The yield per passenger increased by 8.4 per cent, while passenger numbers rose by 6.6 per cent.

Its long-haul flights saw a 12 per cent increase in passenger volumes, while its yield rose 11.2 per cent when compared with the same period of the previous year.

The airline said it remained “financially strong”, with gross cash rising by 8.3 per cent year on year to just more than €1 billion at the end of March 2012. Its debts rose by 1.5 per cent to €556.1 million.

Aer Lingus, which will hold its annual general meeting in Dublin today, continues to be subject to inflationary costs.

Its fuel costs rose in the quarter by 31.4 per cent to €68.6 million.

The airline said it remained “focused” on its cost base and said its Greenfield cost-reduction programme was “on track”.

Commenting on the results, Aer Lingus chief executive Christoph Mueller said: “We have deliberately compensated for the continuing decline in private Irish consumer demand with an increased focus on serving time-sensitive traffic, which comprises a higher proportion of business travellers.

“Aer Lingus’s operating profit for 2012 should match that achieved in 2011. However, the performance of certain short-haul routes is weaker than expected and our business continues to be subject to inflationary cost pressures.”

Earlier this week, The Irish Times revealed that Abu Dhabi-based airline Etihad had built up a 2.987 per cent stake in Aer Lingus and that the pair were in talks on a code-sharing agreement.

Separately, Aer Lingus announced the appointment of Ravindra Simhambhatla as its chief technology officer. He will join the airline in June.

This is a new position created as part of a recent restructuring of the company’s leadership team.

Mr Simhambhatla most recently worked for Tesla Motors as vice-president of IT, and previously spent four years with airline Virgin America. He will lead Aer Lingus’s information solutions and services team.

Aer Lingus closed up 1.5 per cent in Dublin at 99 cent.