Aer Lingus First Half Results

Aer Lingus today announced an operating profit of €14.3 million for the first half of 2003 against an operating loss of €12.6 million for the same period last year and an operating loss of €38.1 million for the first half of 2001.

Turnover at €414.1 million was down 8.6% from €453.1 million for the first half of 2002 driven by the continuing reduction in fares.

However, costs were also down significantly at €399.8 million, a 14.2% reduction compared with €465.7 million in the first half of 2002 and a 30% reduction compared to €571.1 million in 2001. This represents the airline`s continuing relentless campaign to drive out cost and pass on the savings to the customer in the form of lower fares.

The low fares strategy sustained by a much lower cost base has led to a significantly higher passenger load factor at 80% for the first half of 2003 compared with 73% for the same period last year and 69% in the first six months of 2001.

EBITDAR at €59.6 million compares with €42.1 million for the first half of 2002 and €26.9 million for the first six months of 2001.

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Commenting on these results, Chief Executive Willie Walsh said; “We continue to make good progress towards the goal of transforming Aer Lingus into a low fares airline delivering a quality service. The strategy is working with our customers benefiting from significantly lower fares, 16 new routes offering enhanced direct access into and out of Ireland and growing usage and international success of our website aerlingus.com. The result is improved profitability in the first half of 2003 against a tough background including the war in Iraq and the SARS scare. We remain on track to achieve our full-year forecast outcome.”

Looking at the broader market Willie Walsh said: “We are excited by the opportunities opening up in the Irish air travel market. Independent airports at Cork, Dublin and Shannon represent great growth potential and we are poised to take advantage of the impending change in the Ireland/US bilateral which will open up new US gateways for Aer Lingus.”

However, Willie Walsh warned that Aer Lingus would not become complacent: “We will continue until the process of transformation in Aer Lingus is complete. There are many challenges ahead - we must further improve profitability, continue to reduce costs, add new routes and continue to lower our fares. The progress we have made will act as a spur to further change.”

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