February 16, 2011
By Staff Reporter
Transport Minister Seamus Brennan will meet the flag carrier’s board of directors later this month to review the implementation of the survival plan.
Last year, the airline was plunged into crisis by a drop in passenger numbers as a result of the impact of the foot-and-mouth-disease crisis and the fallout from the Sept. 11 attacks on the U.S. It lost euro 139.9 million, compared to a profit of euro 71.6 million in 2000.
The survival plan reduced the staff by 2,000 — one third of the total — cut the cost base by euro 190 million, made radical changes in work practices and brought in a pay freeze.
The projected loss for this year had been euro 27 million. But chief executive Willie Walsh said the ongoing introduction of an extra euro 130 million in cost-cutting measures meant the company was on track to make a profit of up to euro 40 million this year.
Brennan said his primary concern in recent months has been to see a viable and flexible airline take shape. The cost cutting has to continue unabated, he said, and the company has to build up its reserves or it would be vulnerable to “market forces and particularly to unexpected economic and other external shocks.”
The minister told Fine Gael’s Dennis Naughten that he plans to look at the airline’s future funding requirements in the “near future.”
Originally the government had planned to privatize Aer Lingus and float it on the stock market. But the financial crisis led to a change in policy and a decision to “facilitate private sector and staff investment” to fund future development.
Final negotiations are under way on an employee share option plan to bring the worker’s share of the company up from 5 percent to 14.9.