Dáil Éireann Debate, Thursday - 12 May 2005
27 Mr. Quinn asked the Minister for Transport his views on the latest annual report from Aer Lingus; when the new chief executive designate will take up his position; and if he will make a statement on the matter. [15574/05]
Amharc ar fhreagraI welcome the recently announced Aer Lingus results for 2004 which show a solid financial performance for the year at the operational level with an operating profit of €96.3 million. The provision of €102.5 million for restructuring costs gives a net profit of €1.2 million for the year.
Significant developments during the year include further reductions in costs, the introduction of a new low fares strategy, the launch of the Fast Pass check-in facility at Dublin Airport and the dramatic increase in the use of the web for bookings. The board, management and staff are to be commended for this continued turnaround in the ongoing challenging environment in aviation.
Looking to the future, the competitive and changing nature of the aviation industry and the ongoing market pressures require a continuing focus by the company on cost reductions and efficiency improvements in order to sustain a profitable and viable operation which can take advantage of growth opportunities.
Unless the focus on efficiencies and competitiveness continues unabated, the airline will continue to be vulnerable to market forces and to unexpected economic and other external shocks. Furthermore, it will not have the necessary cost base to support a growth strategy. It is, therefore, vital that the cost cutting measures and new work practice changes in the company's existing business plan are delivered.
The second key essential for the future success of Aer Lingus is that it must be provided with the flexibility to grow and compete on a level playing field. The current situation in relation to access to capital is not sustainable and, if continued, will seriously restrict the airline, particularly in relation to profitable growth opportunities on long-haul routes. To fund that growth and to provide financial security, the airline must have access to the full range of funding mechanisms and equity capital is a crucial element in that mix.
In that context, the Government will be making a decision shortly on the necessary arrangements to be put in place to facilitate an investment transaction.
Once the Government makes its decision in the matter, consultations with all the stakeholders will take place in relation to options for a transaction and in relation to essential preparatory work.
In relation to the new chief executive designate, I have been advised by Aer Lingus that Dermot Mannion will be taking up the position at the airline in August 2005.
