Ryanair to give away 1,000 seats for every EUR1 million of tax losses announced by Aer Lingus
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Ryanair announced (06-Mar-09) that it would give away 1,000 free seats for every EUR1m of after tax losses announced by Aer Lingus in its full year results on Wednesday 11-Mar. Ryanair believes that Aer Lingus will announce an after tax loss of between EUR100m to EUR150m, which will see Ryanair release between 100,000 to 150,000 free seats for travel during 23 - 27-Mar-09 on its 105 routes to/from Dublin and Shannon airports.
Ryanair said it was taking this initiative to highlight the extent to which Aer Lingus misled its shareholders and the markets in its 22-Dec-08 Defence Document - published less than 10 weeks ago - in which Aer Lingus Chairman, Colm Barrington claimed:
“Despite these extremely challenging conditions
we expect to achieve profit overall in 2008”.
Ryanair pointed out other dubious claims made by Aer Lingus, Chairman, Colm Barrington in this 22-Dec Defence Document which have also proven to be untrue, including:
1. “This business continues to grow and to generate high returns on capital.”
Aer Lingus this morning announced an 8% decline in its February passenger traffic and its 2008 losses to be announced on 11-Mar will generate a negative return on capital.
2. “Our long-haul business also continues to grow”.
This morning Aer Lingus confirmed that its long-haul traffic declined in February by 12%.
3. “Aer Lingus is and will be profitable”.
Ryanair believes that Aer Lingus is and will continue to be loss making.
4. “We expect that significantly reduced fuel prices and a number of management cost reduction initiatives will enable Aer Lingus to continue to enhance profitability in 2009 and beyond”.
Ryanair believes that Aer Lingus will lose money again in 2009, as its traffic is in freefall, while its costs are rising.
Ryanair today called on Aer Lingus, Chairman, Colm Barrington to update the market next Wednesday on his vow (Irish Times - Dec-08) to find “a friendly investor who will take a majority stake in Aer Lingus to prevent Ryanair from bidding again for the company”.
Since Aer Lingus’ share price has collapsed from the EUR1.40 Ryanair offered in December, to as little as EUR0.70 in recent weeks (24-Feb), Ryanair calls on Aer Lingus, Chairman, Colm Barrington to explain to all shareholders what he and his Board are doing to recover this enormous loss of shareholder value. Can Mr Barrington and his Board recommend shareholders to reject Ryanair’s offer of EUR1.40 per share only to preside over a share price collapse to just EUR0.70 over the past 4 weeks?
Ryanair’s offer of 1,000 free seats for every million euro of after tax losses announced by Aer Lingus on 11-Mar will be released on Ryanair’s website on 11-Mar.
(c) Centre for Asia Pacific Aviation. Date posted: 09-Mar-09
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Ryanair to give away 1,000 seats for every EUR1 million of tax losses announced by Aer Lingus 
