Long-haul costs dent Air Contractors profits

The set-up costs of a transatlantic service it launched for Aer Lingus dented profits at Irish freight and passenger carrier Air Contractors last year, the latest figures show.

Accounts just lodged by the airline show that turnover rose 23 per cent to €57.5 million last year from €46.7 million in 2012. However, profits fell 18 per cent to €4 million from €4.9 million on the back of a sharp rise in costs, which were €55.8 million in 2013, compared with €43.75 million the year before.

The directors’ report states that the company “incurred substantial start-up costs in securing and establishing a platform to perform long-haul contract passenger operations” and adds that these resulted in a lower operating margin for 2012.

Air Contractors began operating three transatlantic services for Aer Lingus, Shannon to New York and Boston and Dublin to Toronto, in February using leased Boeing 757s.

As it began flying those routes this year, using its own pilots and craft and Aer Lingus cabin crew, its 2014 results are likely to show an increase on last year’s figures.

The Aer Lingus deal was part of the larger airline’s expansion of its long-haul services.

The Swords, Dublin-based company’s main business is operating a large network of freight services across Europe using a fleet of 35 ATR craft.

It has a French subsidiary, Europe Airpost, which paid a €3 million dividend to it in 2013, 7 per cent more than the €2.8 million delivered in 2012.