Aer Lingus: No profit yet in 2005
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Aer Lingus: No profit yet in 2005
WTF is going on? Revenue down E60m!
Irish Independent (free rego)
(excerpt)
AER Lingus has yet to make a profit in 2005, the company told union representatives recently.
Six months into its financial year, Aer Lingus told staff that not only had it not yet moved into the black, but that it had made a loss in each month of the year so far.
It is understood that May was a particularly bad month for the company.
The losses are blamed on a failure by management to secure changes in work practices.
[SNIP]
In financial terms, Aer Lingus is currently facing two problems.
The failure to secure changes in work practices has prevented the company moving into the black.
But at the same time, the semi-state company is looking at falling revenues. It is understood that revenue for the year-to-date is down by approximately €60m on the same period last year.
Aer Lingus made a profit of only €1.2m last year on sales of €907m. While poor, these results were broadly in line with the business plan adopted by Mr Walsh in July of last year.
That confidential plan, a copy of which has been seen by the Irish Independent, envisages Aer Lingus turning a profit of €91.8m this year. Under the terms of the plan 2005 would have seen the company make its most radical attack on its cost base reducing the "cost per seat" from €95.40 in 2003 to €75.90.
Aside from cost reductions associated with staff cuts and changes in work practices, the business plan also envisaged a "significant reduction in maintenance costs from 1 January 2005." It is understood this target has not been met.
Irish Independent (free rego)
(excerpt)
AER Lingus has yet to make a profit in 2005, the company told union representatives recently.
Six months into its financial year, Aer Lingus told staff that not only had it not yet moved into the black, but that it had made a loss in each month of the year so far.
It is understood that May was a particularly bad month for the company.
The losses are blamed on a failure by management to secure changes in work practices.
[SNIP]
In financial terms, Aer Lingus is currently facing two problems.
The failure to secure changes in work practices has prevented the company moving into the black.
But at the same time, the semi-state company is looking at falling revenues. It is understood that revenue for the year-to-date is down by approximately €60m on the same period last year.
Aer Lingus made a profit of only €1.2m last year on sales of €907m. While poor, these results were broadly in line with the business plan adopted by Mr Walsh in July of last year.
That confidential plan, a copy of which has been seen by the Irish Independent, envisages Aer Lingus turning a profit of €91.8m this year. Under the terms of the plan 2005 would have seen the company make its most radical attack on its cost base reducing the "cost per seat" from €95.40 in 2003 to €75.90.
Aside from cost reductions associated with staff cuts and changes in work practices, the business plan also envisaged a "significant reduction in maintenance costs from 1 January 2005." It is understood this target has not been met.
