Recent trading performance
- Aer Lingus initiated fundamental actions in 2009 and early 2010 to address the difficult market conditions which then faced the airline.
- Following an in-depth review of the airline’s business model and addressable markets in 2009, Aer Lingus concluded that it needed to revise its strategic direction. Aer Lingus then positioned itself as a “value carrier” on the basis that the pure low cost and low fares model is not sustainable while a full service model would not be viable in our key short haul markets.
- The fundamental elements of this revised strategic approach included better matching of capacity to demand (involving reduction of long-haul capacity and reductions in capacity on over-served short-haul routes), a renewed focus on generating revenue per seat rather than simple maximisation of load factor as well as more emphasis on partnerships and connectivity to deliver on our primary mission of connecting Ireland with the world. In addition, the Group launched a €97 million cost saving programme (known as the 'Greenfield' programme).
- This strategic approach has proved successful and Aer Lingus continues to pursue the "value carrier" business model.
- 2012 was another successful year with the Group recording an operating profit of €69.1 million, our third straight year of operating profits.
- A summary overview of 2012 performance is:
- Operating profit of €69.1 million up 40.7% on 2011 with strong operating margin of 5.0% (2011: 3.8%).
- Total revenue up 8.2% with capacity growth of 0.5%.
- Total passengers carried on Aer Lingus services in 2012 (incl. Aer Lingus Regional and the Washington Dulles – Madrid codeshare with United Airlines) of 10.8 million represents the highest number flown in a single year by the Group.
- Market share ex-Ireland (incl. Aer Lingus Regional) increased by 2 percentage points from 41% to 43%.
- Greenfield programme completed. Annualised cost saving target exceeded with total savings of €104.2 million.
- Strong balance sheet; gross cash up 1.5% to €908.5 million as at 31 December 2012. Debt down 7.9% to €531.6 million.
