Dermot Mannion,chief executive of Aer Lingus has decided to blame the world for the €1.2m reduction in Aer Lingus profits for 2006. Explicitly, he cites higher fuel costs and the terrorism alert in the UK last August, but failed to cite himself and his managements lack of strategic/operational management skills.

So that we can all digest the spin in this announcement lets just bullet point the key figures, to avoid ambiguity,

• Pre-tax profits down from €91.6m to €90.4m
• Total Revenue up by 11% to €1.1billion.
• Total passengers up 7.3% to 8.6million
• Load Factor dropped from 81.4% to 77.6%
• Short Haul passengers up 9% but available seats up by 20.6%
• Long Haul Passengers fell by 4.4%
• On Board Sales and Car hire up 34% to €63.4m
• Fuel cost up by 44.4% or €61.7m
• Staff costs increased by 8% no figure given as what figure is now.
• €16m spend on defending itself from Ryanairs takeover.

Lets have a closer look shall we,

• Pre-tax profits down €1.2m not so bad really
• Total Revenue up €100m or 11% again not so bad, good actually.However no account of how much fuel surcharge is contained in figure.
• Total passengers up about 585,000 again well done
• Load factor down 3.8%, not good given capacity grew in short haul by 20.6% thereby giving the impression that new/existing routes are'nt commercial or the airline is now a bus service and will go without passengers. If capacity is up and passengers are down relatively, this would have to mean that you and me are paying more.It would also suggest that rather than use and exploit the existing routes unprofitable expansion appears to be a chosen strategy. Additionally Long Haul suffered a 4.4% fall and would suggest expansion of this un-commercial/un-profitable piece of the business needs to be called into question.
• On board Sales and car hire up, who gives a shite, this is an airline.
• Fuel costs up 44.4% or €61.7m again how much was recouped via surcharges would be a nice statistic to have.
• Staff costs up 8% to what from what?, given that apparently there is a "operative" busting his/her arse earning €110,000 pa. How will the proposed pay freeze of top management affect this figure in 2007? if at all.
• €16m on defending itself from Ryanair. No, now costs €16m anyway the capitalisation of Aer Lingus increased about 28% or say €300m due to the approach, not a bad return but not a return generated by Mannion et al.

So, its first set of accounts issued to the financial world as a plc, and like its management they are as deep as a puddle. No mention of the massive JetBlue deal, appears the discussions with unions are "positive" despite the union saying that essentially "thats boll#*ks". The Union also went on to say that the credit for these figures were down to the €110,000pa employees, and the flotation was a "disaster", I expect the unions to give back its shareholding any day now.

Success has many facets, in Aer Lingus's case its charging too much, changing fares quietly whilst announcing reduction in fuel surcharges, paying too much to one member of staff, never answering the phone to customers, talking shite, and finally preparing to become another Eircom.

Add a comment

 | Link | back to top |

No mention of Google Ads on its website either....

There still is no detail anywhere on the web on the figures, how come all other companies results are issued and then available either on yahoo,google etc within minutes, with commentary?

No these boys are hiding, and its with my money, Christ I'm annoyed.

What the f#*k is a technical accounting loss of €33m. I am a simple man but when I did commerce a debit was a debit and a credit was the opposite. Are they saying that they found, and then released something on the Balance Sheet that was'nt known about?.

Did you see that, as per your question, what level of the fuel savings were re-couped from the "surcharge", he declined to give the figure for the total amount raised.

Christ I can remember Eircom, I am annoyed.........

How did the €1.2m loss turn into €69.9m loss as complied by Elizabeth McGuane in the SBP