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Aer Lingus profit up 17.8% as Mueller says farewell

Aer Lingus’ preliminary financial results for the year ended 31 December 2014 have revealed the airline’s operating profit increased by 17.8% over 2013’s figure – rising from €61.1 million to €72 million – on which basis the airline’s Board is proposing to pay an increased dividend of 5 cents per share for 2014, up from 4 cents for the year 2013.Total revenue for 2014 was €1,556.9 million, up 9.2% compared with €1,425.1 million in 2013. Aiding this results was the average fare revenue per seat of €98.93, up 9.4%. Furthermore, during 2014 Aer Lingus’s total network passengers surpassed 11 million for the first time.Long-haul performance in particular thrived, with revenue rising 28.4% year on year to €490 million, passenger numbers increasing by 20.6% and load factor rising 0.6 points to 83.7% in comparison with 2013.The average fare per seat in the short-haul sector, on the other hand, only increased by 2.5% year on year to €69.60. Short-haul revenue in 2014 was €791.0 million compared with €789.0 million in 2013.The balance sheet at the year-end shows a 29.9% increase in net cash to €545.3 million in comparison with the figure at the end of 2013.“The year 2014 proved the strength of our ‘value carrier’ business model across both our short- and long-haul businesses. We profitably expanded our long-haul network utilising our cost advantage and favourable geographic position and helped establish Dublin as the 7th largest European hub for transatlantic connections,” explained Christoph Mueller, Aer Lingus’s CEO. “Our short haul business continued to demonstrate its resilience despite a highly competitive market. Commercial initiatives, in addition to cost control, led to the highest operating profit since the financial crisis and 17.8% above last year.“The focus on our business is unabated and in the coming months we will invest in our customer proposition and distribution model in addition to reducing costs. Now that the complex IASS pension funding issues have been addressed, we are re-launching our CORE programme, starting with the introduction of a new voluntary severance scheme at the beginning of this year.“I am delighted to hand the reins to Stephen Kavanagh at the end of this week. I know that the entire Aer Lingus team has a lot of work planned for 2015 and I am confident that they will drive further improvements in profitability, customer satisfaction and employee engagement,” added Mueller.Aer Lingus chairman Colm Barrington commented, “Our performance in 2014 was strong, with significant growth in long haul and resilient short haul operations. To enhance these excellent results and to accelerate Aer Lingus’s growth, it is the Board’s strong belief that the company should now take the opportunity to combine with IAG. In this combination Aer Lingus will operate as a separate business while gaining access to IAG’s extensive network and benefiting from its scale. These significantly positive benefits will de-risk Aer Lingus’s future, strengthen its operations and enhance the future success of the company.”

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