Aer Lingus is pointing to a strong performance in higher yielding and long-haul traffic as key to it cutting operating losses to €4.4 million ($5.4 million) in the first half.
It marks an improvement on the €26.8 million lost at the same stage last year, the six months to 31 March is traditionally loss-making for the carrier, and prompted a subtle hardening of its full-year outlook in saying it expects if current trends continue to at least match the €49.1 million operating profit seen in 2011. It had in its first quarter said full-year operating profit "should match" the 2011 figure.
"Most of the improvement has been on the revenue side," says a spokesman for the Irish carrier, pointing to a 10% jump in first half revenues €626 million. "We put this down to improvements on the high yielding traffic," he says. Average passenger yields rose 6% in the first half
"Long-haul has been a big performer," he adds. Passenger numbers grew 11% on the long-haul segment on a 3% lift in capacity. This helped Aer Lingus boost long-haul load factors
The strong revenue performance helped it offset higher fuel costs in the period. Its fuel costs were up nearly 30% in the first half.
The improved results were timely for the carrier as it today set out its recommendation for shareholders to reject Ryanair's latest offer for the carrier. It based its rejection on both the recent strength of the Aer Lingus since it introduced its turnaround strategy in late 2009 and what it believes is the limited likelihood of European competition authorities approving the deal. It points to the increased route overlap between the two carriers since the European regulators blocked Ryanair's initial bid in 2007.
Aer Lingus calculates there were 35 overlapping routes across Irish airports in 2007 compared to 50 today. "Since 2007, there have been a significant number of operators pulling out of the market," the Aer Lingus spokesman notes, while also highlighting a number of airline collapses have also taken competitors out of the market.