{"id":284336,"date":"2011-02-28T10:51:09","date_gmt":"2011-02-28T10:51:09","guid":{"rendered":"http:\/\/www.ghanamma.net\/2011\/02\/28\/aer-lingus-warns-of-tougher-times\/"},"modified":"2011-02-28T10:51:09","modified_gmt":"2011-02-28T10:51:09","slug":"aer-lingus-warns-of-tougher-times","status":"publish","type":"post","link":"https:\/\/www.ghanamma.com\/2011\/02\/28\/aer-lingus-warns-of-tougher-times\/","title":{"rendered":"Aer Lingus warns of tougher times"},"content":{"rendered":"

\n \t\t
\n 28 February 2011<\/span>
\nLast updated at <\/span>05:51 ET<\/span>
\n<\/span><\/p>\n

Aer Lingus has reported a return to profit in 2010, but warned the coming year will be much more challenging.<\/p>\n

The Irish national carrier made 47m euros ($64m, \u00a340m), up from a 130m euro loss in recession-struck 2009, despite passenger volumes hit by volcanic ash, the Irish crisis, and winter weather.<\/p>\n

But the firm said that recession in its home market, higher airport taxes and fuel costs would hurt profits in 2011.<\/p>\n

The airline has also been hit by an unexpected tax demand from Dublin.<\/p>\n

Last week Aer Lingus was forced into 32.5m euros provision to cover a tax demand related to its renegotiation of contracts and wages with 715 ground staff in 2008-09.<\/p>\n

The move was part of a 41m euro cost reduction strategy.<\/p>\n

Business strategy<\/span><\/p>\n

Passenger volumes were down 10% last year to 9.3 million – coming on top of a 13% fall the year before – as the Irish economy remains flat on its back.<\/p>\n

Business was also hurt by the Iceland volcanic eruption in April and extreme winter weather in December.<\/p>\n

\n\tContinue reading the main story<\/a>\t<\/p>\n

\u201cStart Quote<\/span><\/h2>\n
\n

If current fuel prices persist, we expect that 2011 operating profits will be significantly below that of 2010\u201d<\/p>\n<\/blockquote>\n

End Quote<\/span>
\n\tChristoph Mueller<\/span>
\n\tAer Lingus chief executive<\/span><\/p><\/div>\n

Yet despite this, Aer Lingus managed to eke out a 1% gain in revenues to 1.22bn euros.<\/p>\n

Management attributed the turnaround to a new business strategy that has boosted earnings per passenger, particularly on transatlantic routes.<\/p>\n

The return to profit was in line with analysts’ forecasts, although Aer Lingus’ share price fell 1.5% in early trading, having been up nearly 3% at the open on Monday.<\/p>\n

Ryanair tie-up<\/span><\/p>\n

But the strong performance is unlikely to be repeated in 2011, according to chief executive Christoph Mueller, with the company’s fortunes hostage to events in the Middle East.<\/p>\n

“If current fuel prices persist, we expect that 2011 operating profits will be significantly below that of 2010,” he said.<\/p>\n

Continue reading the main story<\/a><\/p>\n

\t<\/p>\n

\t<\/p>\n

Citing higher airport taxes as another concern, Mr Mueller said he did not expect continued cost cutting measures and rising passenger spending to be enough maintain current profit levels.<\/p>\n

Passenger volumes also remain a concern, with the Irish economy stagnant, and the airline is not planning any increase in capacity this year.<\/p>\n

Mr Mueller dismissed speculation of a possible tie-up with rival Ryanair, which already owns 30% of the national carrier, and has twice attempted to take it over.<\/p>\n

With a change in government in Ireland over the weekend, questions have been raised over whether it may dispose of its remaining 25% stake in the company.<\/p>\n

“The Aer Lingus share is currently still undervalued,” said Mr Mueller speaking to the Reuters news agency.<\/p>\n

“The government would certainly be ill-advised to sell at a time when the outcome won’t be optimal for taxpayers.”<\/p>\n<\/p><\/div>\n<\/p>\n

Go here to read the rest:
\nAer Lingus warns of tougher times<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

28 February 2011 Last updated at 05:51 ET Aer Lingus has reported a return to profit in 2010, but warned the coming year will be much more challenging. The Irish national carrier made 47m euros ($64m, \u00a340m), up from a 130m euro loss in recession-struck 2009, despite passenger volumes hit by volcanic ash, the Irish crisis, and winter weather. <\/p>\n","protected":false},"author":0,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-284336","post","type-post","status-publish","format-standard"],"yoast_head":"\nAer Lingus warns of tougher times - Ghanamma.com<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.ghanamma.com\/2011\/02\/28\/aer-lingus-warns-of-tougher-times\/\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:title\" content=\"Aer Lingus warns of tougher times - Ghanamma.com\" \/>\n<meta name=\"twitter:description\" content=\"28 February 2011 Last updated at 05:51 ET Aer Lingus has reported a return to profit in 2010, but warned the coming year will be much more challenging. 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