Aer Lingus forecasts €29m profit for this year
Carrier lost €81m in 2009 -- but rosters dispute still unresolved
Published 14/10/2010 | 05:00
AER Lingus expects to report an operating profit for the current full year's trading that will be at the top end of market forecasts of about €29m. That will compare to an €81m operating loss in 2009.
The €110m turnaround could come as the airline, which is headed by chief executive Christoph Mueller, said business strengthened considerably during the third quarter of the year.
September proved to be particularly robust on the back of improved yields.
In a trading statement issued yesterday, the airline added that forward revenues for October and November were likely to be ahead of expectations.
However, Aer Lingus cautioned that its profit forecast was dependant on industrial action not disrupting its operations.
Cabin crew who are members of IMPACT worked to rule yesterday in a simmering dispute over rostering which has previously been the subject of an arbitration agreement at the Labour Relations Commission.
IMPACT claims that the new rosters go beyond what was agreed under that arbitration.
The airline has warned cabin crew who take part in the industrial action that they could lose their jobs. IMPACT has said cabin crew will consider strike action if disciplinary action is taken against its members.
"Aer Lingus will not accept staff refusing to carry out some or all of their contractual duties," the company's director of staff relations, Sean Murphy, told staff in a circular last week.
"Such a refusal could result in immediate removal from payroll and may culminate in dismissal," he said.
Aer Lingus also revealed that pilots who are represented by the Irish Airline Pilots' Association (IALPA) have also staged a ballot over rostering.
Shares in the airline closed more than 1.3pc down in Dublin yesterday at €1.13, having risen over 3pc earlier in the day on the back of the trading statement.
Despite trading having been stronger than expected in the third quarter, Aer Lingus warned that to date, December bookings had not continued the momentum.
"Forward revenues indicate that December and the first quarter of 2011 appear much weaker than anticipated," it said in the trading statement.
"However, the group is not yet able to determine whether this reflects the recent trend towards later bookings or an underlying softness in demand."
Aer Lingus said it shared the concerns expressed by the International Air Transport Association (IATA) last month that 2011 offered an increasingly weak outlook for both European and US carriers.
"Consumer spending is not expected to pick up the slack as joblessness remains high and consumer confidence falls in Europe and North America," said the IATA.
Aer Lingus said that in terms of the overall outlook for the company: "Weakness in North America and Europe would be further compounded by the weakness of the Irish economy."