From the annual report 2011
Ground operations cost per seat increased by 3.0% of which around half was due to changes in exchange rates. Good progress was made in renegotiating contracts with ground handlers and reducing the use of optional services at airports, however this was more than offset by price increases at regulated airports,notably London Gatwick and the AENA airports in Spain. Successful delivery of easyJet’s strategy requires the use of more expensive, often regulated, primary airports, and we will continue to develop more efficient ways of working to contain cost per seat in this area.
Cost per seat (excluding fuel) include
1.Ground Operations
2.Crew
3.Navigation
4.Maintenance
5.Selling and marketing
6.Other Costs
So in order for a base to be profitable revenue per seat must be greater than cost per seat. It then stands to reason that if crew costs are excessive something has to give. Combined with higher costs from 1 and 3 bye bye Madrid.
So Smoke and Noise crew costs did indeed contribute to Madrid Base closure. To claim otherwise is naive and simplistic.