Aer Lingus is targeting 100 voluntary redundancies after its first-quarter operating loss grew by a quarter, despite a revenue rise of 3.3%.
At €45.5 million ($59.4 million), the operating loss before exceptional items was up €9.4 million. "This was largely due to the start-up costs for the Virgin wet-lease operation in the UK, planned changes to the long-haul fleet and slightly weaker trading on UK routes," says the Irish flag carrier, which operates on behalf of Virgin Atlantic between London Heathrow and Manchester, Aberdeen and Edinburgh, and has agreed a "damp-lease" of three Boeing 757s to operate on North Atlantic services from early 2014.
The first-quarter result "highlights the need to continue to review our cost base to protect profitability for the rest of 2013 and beyond," says Aer Lingus chief Christoph Mueller. "In line with the ongoing requirement to streamline our organisation structure and identify cost-saving initiatives, we are launching a voluntary severance programme, with a goal of reducing headcount by approximately 100 staff by year end."
Revenues rose from €252 million to €260 million, as passenger numbers climbed 2.2% and operating yield per passenger 3.7%. Long-haul yields led this growth, increasing 5.6%. "We are particularly pleased with the performance of our long-haul business, which is up 14.4% on the prior year," says Mueller.
He adds: "We currently expect 2013 operating profit, before exceptional items, to be broadly in line with last year."