Mar 17, 2008

European Commission officials on Tuesday raided the offices of several international airlines operating long-haul scheduled flights to Japan in an investigation into suspected cartel activity. The Commission, Europe's top competition regulator, issued the confirmation after

Lufthansa said it had been searched in a probe into price-fixing on routes between Europe and Japan. A source at Alitalia said Italy's troubled national carrier was also raided by EU inspectors investigating a suspected cartel on Japan routes. Mar 12, 2008

The EU has launched an antitrust investigation that focuses on carriers flying between EU countries and Japan. Officials said they have searched several airline offices as part of the price-fixing probe. Mar 12, 2008

European Commission yesterday conducted so-called unannounced inspections at the premises of a number of international passenger airlines operating long-haul flights to Japan, suspecting them of price-fixing. Mar 11, 2008

European Parliament yesterday adopted a new regulation that lays down common rules and standards for aviation security throughout the EU. The vote follows the agreement reached two months ago in conciliation between European Parliament and Council representatives. The regulation will enter into force on the 20th day after publication in the Official Journal and will be applied not later than 24 months later. Mar 11, 2008

Three European carriers posted higher February traffic numbers, citing strong growth on new routes. British Airways, however, recently warned that higher fuel costs will hurt profits in the next fiscal year. Mar 10, 2008

Aer Lingus

Aer Lingus did well in its first full year as a privatized company, with a net profit of euro105.3 million ($161.8 million) compared to a net loss of euro69.9 million in 2006. Revenue rose 15.2% to euro1.28 billion on a 7.8% growth in passengers to 9.3 million. Operating costs increased 15.1% to euro1.19 billion, primarily owing to greater volumes and higher oil prices. Fuel cost jumped 26.3% on an underlying basis to euro253.3 million. Operating profit before employee profit share came in at euro88.5 million, up 16.4% from euro76 million a year earlier. Mar 13, 2008

Aer Lingus

Aer Lingus opened a new base in Northern Ireland and added 14 new European routes and three to the US. It also expanded its Airbus fleet from 35 aircraft to 41. RPKs grew 10.8% to 14.8 billion against a 14% rise in capacity to 19.6 billion ASKs. Load factor fell 2.2 points to 75.4%. Unit cost excluding fuel declined 1.2% to euro4.19 cents. Mar 13, 2008

Aer Lingus

Aer Lingus posted a 16 percent rise in 2007 operating profit but said it could not yet give guidance for this year because of uncertainties about the economic outlook and oil prices. Operating profit before employee share came in at EUR88.5 million euros (USD$136 million). The former state airline said it was well positioned to deal with market pressures due to its cash reserves and low costs, but it was too early to predict earnings for 2008. The airline said that in the seasonally weaker first half of the year it expected total revenue per available seat kilometre to be lower than last year. At the end of February, Aer Lingus had hedged 36 percent of its remaining 2008 fuel requirements at USD$796 per tonne of jet fuel, but the remainder was exposed to market fluctuations, it said. Mar 12, 2008

Air France

Air France confirmed that its offices were raided this week by the European Commission as part of its investigation into alleged price-fixing practices on passenger flights between Europe and Japan. Lufthansa and KLM revealed Tuesday that they had been targeted. "Air France confirms that in similar fashion to other airlines, it is being questioned by the European Commission about links between the EU Union and Japan. Air France is providing the Commission with its full cooperation," it said in a Wednesday statement. Mar 13, 2008

Air France KLM

Air France KLM's board on Mar. 10 said it would go ahead with a formal offer for the struggling airline on condition that Alitalia's strike-prone unions accepted its terms. The offer is to be presented on Friday. A union source, who spoke on condition of not being named, said Alitalia's unions would meet Alitalia and Air France management early next week to discuss the proposal and that the talks were expected to continue until Easter, which this year falls on March 23. Mar 12, 2008

Air France KLM

KLM yesterday also confirmed its offices had been searched by the European Commission in relation to "possible anticompetitive behavior regarding passenger services on routes from Europe to Japan" and said it would cooperate with investigators. Alitalia was raided too, according to Reuters, but Alitalia did not confirm. British Airways and Virgin Atlantic Airlines, which were sanctioned for colluding on fuel surcharges on long-haul flights, said they were not raided. Iberia noted its flights to Japan were operated on a codeshare basis and said it had no information on the investigation. Mar 11, 2008

Air France KLM, Alitalia

Air France KLM sought to win the backing of Italian unions as it announced a conditional bid for ailing Alitalia on Monday. The Franco-Dutch airline said after a board meeting that it had decided to go ahead with a formal offer for the struggling Italian carrier following months of negotiations -- but only if the strike-prone airline's unions grant it their blessing. It said the "commitment of the trade unions" to the deal would be high on a list of several conditions attached to the offer, which would be presented on March 14. A takeover of the near bankrupt Alitalia is expected to result in 1,700 job losses, about 15 percent of the workforce, according to both airlines. It would consolidate Air France KLM's position as the largest airline in Europe at a time when network carriers are under pressure from low-cost rivals and high oil prices. However Alitalia's future has become a hot issue in upcoming Italian elections. A takeover would end the 62 year independence of one Italy's most distinctive global brands, which is losing EUR1 million euros a day. Mar 10, 2008

Air One, Alitalia, Air France KLM

Italy's senior administrative court has effectively ended Italian airline Air One's hopes of halting exclusive talks by Alitalia with prospective buyer and rival Air France KLM. The court on Tuesday rejected Air One's request to overturn a lower court ruling allowing Alitalia and larger carrier Air France KLM to continue exclusive talks, which should result in a formal bid for the state-owned carrier this week. The court ruled that the process that led to the selection of the best bidder for Alitalia had been conducted. A lower court in the Lazio region in February had rejected Air One's request to suspend the talks and allow it to re-enter the race. Air One had first taken part in the government's auction process which was abandoned last year after the bidders pulled out. Air France KLM did not take part in that process, saying conditions were too restrictive, and then announced its interest late last year, when Rome picked it as preferred bidder. Mar 12, 2008

AirBerlin

AirBerlin's acquisition of LTU has proven to be costly, as the German LCC reported a steep drop in full-year profit to [euro]11 million ($16.9 million) from the [euro]50.1 million earned in 2006. Full-year revenue rose 61% to [euro]2.54 billion but operating profit plunged 66.5% to [euro]21.5 million from [euro]64.2 million owing to "one-time charges in the double-digit millions resulting from the delayed LTU integration and issues associated with the technical integration of the IT systems." AirBerlin also said that "the expected compensation from releasing certain reserves could not be realized," without elaborating. A detailed financial report is due March 31. Mar 13, 2008

Austrian Airlines

Austrian Airlines Group finished its "successful transitional year" euro11.5 million ($17.7 million) in the black, reversed from a euro51.6 million loss in 2006. In conjunction with several other announcements including approval of a new investor and the reconfiguration of its regional fleet, Austrian reported a 4.2% fall in full-year revenue to euro2.55 billion and an 8.2% drop in expenses to euro2.53 billion. The resulting adjusted operating profit of euro39.1 million, compared to an euro8.3 million loss in 2006, was AAG's first positive EBIT since 2004 and "was primarily due to cost reductions achieved as a result of the closure of fuel-intensive, low-yield long-haul destinations featuring low levels of direct demand," it said. Passenger numbers were level at 10.8 million but load factor rose 1 point to 75.1%. Unit revenue climbed 13.6% against an 11.5% increase in CASK. Mar 14, 2008

Austrian Airlines

Austrian Airlines Group's principal shareholder, state holding company OIAG, reached a deal with Saudi-Austrian investor Mohamed bin Iassa Al-Jaber to take a stake in the carrier through a capital increase. The investment of approximately [euro]150 million ($230.1 million) will enable Austrian Airlines to purchase three A320s for operations to the Middle East, Austrian media reported. An OIAG statement said Al-Jaber's involvement will help Austrian speed up its expansion in the region and reiterated that it intended to remain an independent airline as long as it was economically justified and in the interests of the national economy. AAG has a market capitalization of [euro]480 million. Mar 12, 2008

Austrian Airlines

Austrian Airlines' main shareholder, state holding company OeIAG, has agreed terms for a Saudi-Austrian investor to take a stake in the airline, it said on Monday. It said Sheikh Mohamed Bin Issa al Jaber will take a stake via a capital increase. It did not give the value of the deal but the airline had said he was discussing an investment of EUR150 million euros (USD$231.1 million). Austrian Airlines has a market capitalization of EUR480 million. The deal follows weeks of talks with OeIAG (which has just under 40 percent of the airline), insurance companies and banks that form a shareholders' syndicate. The OeIAG statement said Sheikh Mohamed's involvement would help the airline speed up plans to expand in the Middle East. More details would be given after a meeting of Austrian's supervisory board on Wednesday, OeIAG said. Austrian media reports say Sheikh Mohamed acquired an Austrian passport last year. His MBC International owns the luxury Schwarzenberg Palace hotel in Vienna. Mar 10, 2008

Austrian Airlines, OIAG

Austrian Airlines Group's principal shareholder, state holding company OIAG, reached a deal with Saudi-Austrian investor Mohamed bin Iassa Al-Jaber to take a stake in the carrier through a capital increase. The investment of approximately [euro]150 million ($230.1 million) will enable Austrian Airlines to purchase three A320s for operations to the Middle East, Austrian media reported. An OIAG statement said Al-Jaber's involvement will help OS speed up its expansion in the region and reiterated that it intended to remain an independent airline as long as it was economically justified and in the interests of the national economy. AAG has a market capitalization of [euro]480 million. Mar 11, 2008

British Airways, Virgin Atlantic

British Airways and Virgin Atlantic said they had not been raided by the European Commission. Spain's Iberia said its flights to Japan were operated on a code-share basis and it had no information on the investigation. Other European airlines were either not available to comment or said they were checking and had no immediate information. The Commission said its officials were accompanied by counterparts from national competition authorities. Surprise inspections, often known as dawn raids, are a preliminary step in investigations into suspected cartels and do not necessarily mean companies are guilty of anti-competitive behavior. EU Competition Commissioner Neelie Kroes has made fighting cartels one of her highest priorities and has imposed a series of record fines in the last two years amounting to a total of billions of euros. Mar 12, 2008

EasyJet

EasyJet transported 3 million passengers in February, up 14.8% from the year-ago month. Load factor rose 1.4 points to 84.3%. Mar 10, 2008

Finnair

Finnair said its total passenger traffic grew sharply in February, boosted by new flights to India. Total revenue passenger kilometres (RPKs) rose 17.3 percent from a year earlier to 1.77 billion in February, after an 17.8 percent increase in January, Finnair said in a statement on Monday. Overall passenger load factor -- a measure of how well an airline fills its seats -- fell 2.0 percentage points to 74.8 percent. Mar 10, 2008

Flybe

Flybe asks for BAA to be broken up and replacement of CAA as regulator following UK airport charges rise. Mar 11, 2008

London Heathrow Airport

London's crowded Heathrow Airport will be allowed to raise airline charges by a bigger-than-expected 23.5 percent, giving a boost to the airport's indebted owner but sparking fury among its users. Shares in Spanish construction group Ferrovial, which bought Heathrow owner BAA in a GBP10 billion pound (USD$20 billion) deal in 2006, rose 8.8 percent after BAA said on Tuesday the new charges should help it to complete a much-delayed refinancing of its debts by the end of June. But Heathrow users such as British Airways reacted angrily to the price controls from regulator the UK Civil Aviation Authority (CAA), which were more generous to Ferrovial than its previous proposals in November. As well as struggling to refinance its debt amid the global credit market turmoil, Ferrovial has come under fire for service levels at Heathrow, where delays and lost baggage have become commonplace. Mar 11, 2008

Lufthansa

Lufthansa expects operating profit to rise again this year as air travel continues to grow despite financial markets stuttering and fuel prices hovering at record levels. The positive trend was expected to continue in 2009, Lufthansa said in its annual report on Wednesday. A condition for raising the operating result in 2008 from the record EUR1.38 billion euros (USD$2.12 billion), a 63 percent rise, achieved last year was being able to continue to compensate for high fuel prices, Lufthansa said. Fuel costs rose 15 percent to EUR3.86 billion last year, though the weak dollar brought these costs down by 7.3 percent and hedging saved EUR109 million. Lufthansa said this week it was raising the fuel surcharges it imposes on passengers on European and domestic routes to 17 euros each way. It charges 77 euros each way on long-haul flights. Mar 12, 2008

Lufthansa

Lufthansa reported a net profit of euro1.66 billion for 2007, more than double the euro803 million earned in the prior year, on a 13% rise in revenue to euro22.42 billion, both records for the German airline group as results were boosted by a book gain of about euro503 million from the sale of its shares in Thomas Cook. Chairman and CEO Wolfgang Mayrhuber noted that the results were achieved despite high fuel prices, economic uncertainty and stiff competition. They include Swiss International Air Lines earnings for the second half of 2007, the first time those numbers have been incorporated into Lufthansa's full-year figures. Lufthansa said it achieved "cost and revenue synergies" with Swiss totaling euro233 million. Traffic revenue was euro17.6 billion, up 14.4%. The company attributed the revenue rise both to the effects of consolidation with Swiss and to growing passenger demand. But consolidation also added to expenses, particularly in the areas of materials and personnel. Overall expenses rose 10.8% to euro22.5 billion. Fuel costs were euro3.9 billion, up 14.7%. Operating profit climbed 63.1% to euro1.38 billion from euro845 million. Mar 12, 2008

SAS Scandinavian Airlines

SAS Scandinavian Airlines slipped to a loss in the final quarter of last year, in part due to costs related to the Bombardier DHC-8-Q400 problems. Under the compensation deal between the airline and Bombardier, the world's third-biggest civil aircraft maker, SAS placed orders for 13 CRJ900 NextGen jets, with a list price of USD$474 million, and 14 Q400 NextGen turboprop aircraft, with a list price of USD$356 million. The planes would replace the Dash planes taken out of service last year as well as other aircraft in the group's fleet. It also agreed on options for another 17 CRJ900s and seven DHC-8-Q400s. "Deliveries of the aircraft will be made successively in the next few years, commencing in the autumn of 2008 until 2011," the airline said. Mar 10, 2008

ZZ

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