Signs of recovery at Aer Lingus have been accompanied by stern warnings from management that the airline will continue its "remorseless" drive to keep down costs.
The Irish flag carrier, which made heavy losses three years ago, posted a relatively respectable IR£15 million ($24 million) net profit for 1995.
Group chairman Bernie Cahill warns that the result is not enough to shield the carrier from the impact of another downturn, expected within the next two to five years.
The objective remains to seek growth in "carefully selected" niche markets, while tying up partnerships and alliances to strengthen the carrier's international reach.
The start of direct Airbus A330 services from Dublin to New York and Boston, brought in two years ago as part of the restructuring, have continued to produce traffic growth, with an 8% rise in 1995.
Initiatives to bring in new feeder traffic from provincial UK airports also appear to be working, with the carrier reporting a 30% traffic rise over the past year. Traffic elsewhere in Europe rose 10%.
Overall, the core airline operations contributed operating profits of IR£44 million, up by almost one-third on 1994, although the troubled TEAM maintenance business lost IR£5 million.
The group's balance sheet is also looking increasingly healthy because of asset disposals, including the sale of the Copthorne hotel chain, and to the injection of IR£175 million of government cash, the last tranche of which arrived in 1995.
At the height of its financial problems, the group had built up debts of IR£555 million, but by the end of last year that was cut to IR£41 million. Cahill says that balance sheet ratios need further improvements, however.
Source: Flight International
