As Willie Walsh slams Norwegian Air International as unsustainable...
Aer Lingus saw its operating profits soar by almost double in 2016, as parent company International Airlines Group (IAG) announced a 8.6% rise in its own annual operating profits.
The Irish carrier's profits climbed €109m to €233m. Total revenue was up 2.8% to €1.78bn. This was helped by a 9.6% increase in capacity at Aer Lingus. Two new Airbus A330s had also led to an increase in traffic for routes to Los Angeles and Newark, IAG said. Improved productivity due to cost-cutting and the falling price of fuel meant that its operating margin climbed by 4.9% to 14%.
In a statement to the Irish Independent, IAG said:
“Aer Lingus has a strong position at its transatlantic hub in Dublin. The airline has an efficient and competitive cost structure. It is a value carrier and offering competitive prices forms a major part of its proposition. While its performance has been strong, the airline faces intensifying competition on the North Atlantic.”
The global airline group, which also operates British Airways, Iberia and Vueling, paid €1.36bn for Aer Lingus in 2015, after the Government agreed to sell its stake in the business.
IAG has reported that it made €2.49bn in the year to December. Chief executive Willie Walsh – the Dubliner who was formerly CEO of Aer Lingus – called it a good performance in a challenging environment.
The company took a €460m currency hit due to the slump in the British pound. It expects capacity to increase by 2.5% this year, with Aer Lingus growing at a faster rate than BA.
IAG will return €500m to investors, announcing a final dividend of 12.5 cents per share.
Walsh also reacted strongly to the big splash Norwegian has just made in the transatlantic flights game, saying:
"I've always said we'll compete with Norwegian. The difference between Norwegian and us is we're profitable. The fares that they've launched are clearly just designed to get some headline media coverage. They're not sustainable."
Or, as his company tweeted on Thursday...
No free bag?— Aer Lingus (@AerLingus) February 23, 2017
No free seat assignment?
No free meal?
Cheers, you're grand. https://t.co/aZIHqZJpJc