Aer Lingus 2012 Annual Report Download - page 15

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OPERATING REVIEW AND KEY PERFORMANCE HIGHLIGHTS Aer Lingus Group Plc
ANNUAL REPORT 2012
13
Quarter by quarter review of 2012
Q1 2012
Trading in the first quarter of 2012 was significantly ahead of the 2011 comparative period owing to the impact of industrial action in Q1 2011 which
disrupted operations and was estimated to have cost the Group approximately €15 million in lost revenue and additional costs. Total revenue increased
by 15.4% with overall passenger yield increasing by 8.4% and passenger numbers up 6.6%. Long haul performance was particularly strong with long haul
revenue up 24.6% and long haul yield up 11.2%. Retail revenue per passenger was 8.5% ahead of prior year. Total load factor increased by 2.1 points.
Losses were €36.1 million compared with €53.7 million in Q1 2011.
Q2 2012
In Q2 2012, the robust trading performance of the Group continued. Average yield per passenger increased by 5.3% over prior year period with long haul
yields increasing by 7.8%. Capacity was 0.4% lower but load factor was 3.1 points higher than Q2 2011 reflecting the success of our strategy of carefully
matching capacity deployment with underlying demand. Passenger numbers in Q2 2012 increased by 1.2%. The impact of these favourable variances saw
total revenue increase by 6.7% over prior year period.
Increasing fuel prices and unfavourable movements in the EUR/US$ exchange rate were reflected in Q2 2012 with fuel cost increasing by 28.3% compared
to 2011. In addition, airport charges also increased by 8.3%, mainly as a result of price increases at London Heathrow causing total operating costs to be
5.8% higher. However the positive revenue performance more than compensated for the increased operating costs and overall operating profit, before
net exceptional items, increased by 17.8% to €31.7 million. At the half year, we recorded an operating loss, before net exceptional items, of €4.4 million
compared with €26.8 million for the first 6 months of 2011.
Q3 2012
We continued to trade strongly over the key summer months. The year to date momentum in yield and load factor performance continued with long
haul recording a particularly positive performance. In Q3 2012, total passenger yield was 7.2% ahead of 2011 with long haul 11.5% ahead. Load factor
achieved was 86.1%, 1.7 points higher than Q3 2011 with capacity decreasing by 0.6%. Total revenue increased by 5.7% to €460.8 million. In Q3 2012,
significantly weaker demand was noted on core routes to London during the Olympic Games which adversely impacted performance.
Inflationary pressure on costs continued in Q3 2012 however, with fuel 27.7% higher and airport charges 8.1% higher following price increases noted at
Spanish airports and London Heathrow. Overall, in spite of the significant cost inflation and the negative impact of the London Olympic Games, operating
profit of €90.9 million was only 2.9% below the 2011 comparative, leaving us with a year to date operating profit at the end of the quarter of €86.5 million,
29.7% ahead of 2011.
Q4 2012
In Q4 2012, we recorded an operating loss, before net exceptional items, of €17.4 million (2011: loss of €17.6 million). Revenue increased by 8.0% which
offset a total increase of 7.5% in operating costs. This resulted in an operating loss for the quarter that was 1.1% below prior year.
Passenger fare revenue increased by 9.2% compared to Q4 2011 driven by a 0.5% increase in passenger numbers and an 8.6% increase in yield per
passenger. Overall capacity in Q4 2012 was 0.8% lower than prior year. Load factor increased by 1.9 points overall with long haul increasing by 7.7 points
compared to Q4 2011 but short haul decreasing 1.4 points.
Operating costs in Q4 2012 were 7.5% up on Q4 2011 due to a combination of factors but principally fuel and airport charges. Total fuel cost increased
by 11.1% year on year to €83.8 million (2011: €75.4 million). The average fuel price paid per tonne (excluding into-plane costs) in Q4 2012 was
US$1,002 compared to US$952 in Q4 2011. Airport charges increased by 3.9% to €66.6 million (2011: €64.1 million) as a result of significant increases
in charges levied by particular airport authorities in 2012 (notably London Heathrow and Spanish airports). Other costs increased by 7.3% driven largely
by overheads, maintenance and reduced gains on FX currency hedging.