Aer Lingus stabilises its short-haul operation in 1H2009, shares soar

Aer Lingus shares soared 12.2% yesterday as the carrier highlighted further signs of stablisation on short haul sectors upon the release of the carrier’s 1H2009 financial results.

In the 1H2009, Aer Lingus generated an operating loss of EUR93.0 million, compared to an operating loss of EUR23.4 million in the previous corresponding period. The Irish carrier’s total revenue declined 12.2% year-on-year in 1H2009 as average fares fell 17.1% year-on-year.

During the period, Aer Lingus’ total passenger numbers improved 1.7% to 4.93 million, as short-haul passengers jumped 3.6% year-on-year. Long-haul passenger numbers failed to improve performance, declining 11.6% year-on-year. Short-haul traffic (RPKs) increased 7.1% year-on-year in the first half, on a 4.3% capacity increase, producing load factor improvement of 1.9 ppts to 74.1%. As a result, Aer Lingus stated it would continue to concentrate on short-haul operations and cut back long-haul services.

The carrier’s unit costs per ASK (CASK) were up 3.7% year-on-year in 1H2009, as fuel costs increased 10.0% year-on-year. CASK excluding fuel actually declined 1.8% year-on-year in the first half.

See separate report: Aer Lingus’ Transformation Plan; a ray of hope at last?

Air France-KLM records lesser decline in unit revenue

Elsewhere, shares in Air France-KLM gained 1.0% yesterday as the carrier announced that unit revenues, which are still under pressure, recorded a lesser decline in Oct-2009. The carrier released its traffic results for Oct-2009, showing a 5.3% year-on-year decline in passenger numbers to 6.3 million. Traffic declined less than capacity (-4.1% and -5.1%, respectively, compared to Oct-2008) and load factor gained 1.3 ppts to 82.5% in Oct-2009.

Finnair reports load factor improvement

Shares in Finnair were flat upon the release of the carrier’s traffic highlights for Oct-2009. Finnair’s passenger numbers declined 11.6% year-on-year for the month, while cargo volumes increased 4.8% year-on-year. The carrier cut capacity in line with demand and produced a 6.3 ppts increase in load factor to 64.5% for Oct-2009.

Finnair’s SVP Communications, Christer Haglund, confirmed that “capacity was optimally cut to match falling demand. Winter is expected to continue to be difficult, so further adjustments to traffic will be made. For leisure traffic in particular, the coming winter season will be tough…The decline in cargo traffic, however, currently appears to be over”.

Meanwhile, Icelandair’s passenger load factor increased 1.6 ppts in Oct-2009 to 74.2%, as passenger numbers increased 9.0% year-on-year to 171,000. The carrier’s revenue per ASK increased 9.0% year-on-year to EUR4.3 cents.

Elsewhere, shares in Austrian Airlines gained (+2.2%), Lufthansa improved (+1.5%), British Airways remained virtually flat (+0.3%), while Aegean Airlines lost (-1.7%).

Europe selected airlines daily share price movements (% change): 07-Nov-09