Aer Lingus on course for 'mid teens' increase in profits, says Mannion

Aer Lingus chief executive Dermot Mannion said the company was on target to achieve a "mid teens" increase in its operating profit in 2007, in spite of recording a "small" operating loss in the first six months of this year.

This operating profit rise would be in line with market expectations, he added. Analysts are predicting an operating profit in 2007 of about €87 million for Aer Lingus.

The second half of each year is traditionally a busier period for Aer Lingus, due to a higher volume of holiday traffic.

Mr Mannion was speaking after Aer Lingus's annual general meeting in Dublin.

Earlier, in a trading update to shareholders at the agm, chairman John Sharman said Aer Lingus would increase its capacity in 2007 by 14.6 per cent.

"We are maintaining relative strength in our yields, while we are experiencing some softness in load factors, which in part reflects increased capacity," he said. "Ancillary revenues have been strong."

Latest traffic statistics, published yesterday, showed that Aer Lingus carried 4.4 million passengers in the six months to the end of June. This represented a rise of 5.9 per cent on the same period of 2006.

Short-haul traffic increased by 6.5 per cent to 3.8 million, while long-haul passenger numbers rose by 2.3 per cent to 545,000.

The number of seats filled on each flight declined, however, from 77 per cent in the first half of 2006 to 75.3 per cent for the same period this year.

Mr Mannion said the passenger figures were "robust". He declined to give figures for the company's route to Dubai.

In reply to a shareholder question about new routes, Mr Sharman said the potential growth for the airline outside Europe and the United States was "small".

Mr Mannion said the airline had yet to sign a contract with Airbus for 12 new aircraft but expected to do so shortly. Shareholder approval for the deal will be required.

Aer Lingus's shares closed up 0.55 per cent to €2.55 in Dublin yesterday, while Ryanair was down 5 cent or 1 per cent at €5.21.