AER LINGUS HAS slashed its profit expectations for the year in the wake of the cabin crew strike over the June bank holiday weekend.
The airline issued a trading update this morning outlining that profits will be 10-20% lower than last year.
Davy estimated that the impact of the strike will reduce operating profits to between €49-55 million.
It said that the strike itself, as well as the threat of further work stoppages, had impacted trading and booking “for several months into the future.”
This has been particularly noticeable in recent days following increased media coverage and commentary.
The strike is thought to have already cost Aer Lingus in the region of €10 million and resulted in the cancellation of just under 30,000 passenger journeys.
With the prospect of further strikes not yet off the table despite a decision last night to postpone two one-day work stoppages scheduled for next week, the possibility of further damage to the carriers profitability is still very real.
The 10-20% impairment announced this morning is based on the assumption that there are no further strike days lost.
Aer Lingus stock was trading down 2.7% this morning on the news.
Davy analyst Ross Harvey said: “Today’s statement is clearly a setback, as the threatened action comes at the beginning of the important summer period.”
To embed this post, copy the code below on your site
have your say