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Old May 18th, 2005, 10:16 AM   #921
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Quote:
Originally Posted by babystan03
^


Maybe it's because it's not very crowded at the counter.......
still.. itz not good for the company's image... looks like she's so bored and the rest are like 'i don give a hoot' like attitude.. heh hehh
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Old May 18th, 2005, 10:43 AM   #922
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Quote:
Originally Posted by musang
still.. itz not good for the company's image... looks like she's so bored and the rest are like 'i don give a hoot' like attitude.. heh hehh
Yeah.....maybe I should complain to CIAS.....
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Old May 18th, 2005, 05:35 PM   #923
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More routes for Tiger ......

Business Times - 18 May 2005

Tiger Airways flies to Padang, Indonesia


SINGAPORE - Singapore low-cost carrier Tiger Airways said on Wednesday it will start flying to Padang in Indonesia's West Sumatra province from Thursday.

Tiger Airways said it will initially have three flights a week to Padang, a city of around 800,000 people and whose beaches are reputed to be among the best in Asia for surfing.

The carrier, which is 49-per cent owned by Singapore Airlines, flies from Singapore to Macau and other cities in Thailand, Vietnam, the Philippines and Indonesia.

Promotional prices for a one-way ticket will start at around $15 (US$9) excluding taxes and other charges.

Copyright © 2005 Singapore Press Holdings Ltd. All rights reserved.
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Old May 19th, 2005, 05:09 AM   #924
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Ryanair triggers union protests over non-union salary hikes

BRUSSELS, May 18 (AFP) - Union leaders slammed low-cost airline Ryanair Wednesday for negotiating salary hikes only with non-union staff, saying its strategy was tantamount to "blackmail" to force people to leave unions.

The European Transport Workers' Federation and the International Transport Workers' Federation (ETF, ITF) lashed out after the Irish budget carrier decided Tuesday to raise pay by three percent backdated to April 1, except to employees negotiating through unions.

"Discrimination of workers to collective bargaining because a worker freely chooses to affiliate to a trade union is totally unacceptable," said ETF official Erika Young.

"In this case, it borders almost to blackmail. Inferring that affiliation to a trade union is detrimental to the company's profits is extremely misleading, given the success of other unionised low-fares and network carriers."

According to Ryanair personnel chief Eddie Wilson, the pay increase applies to all staff who participated in the direct negotiations with the company. Only Dublin-based pilots did not do so and were therefore left out.

"This pay increase reinforces the strength of Ryanair's model whereby people negotiate directly with the company and as a result enjoy better pay and conditions than our low-pay unionised competitors," he said Tuesday.

The airline added that the staff who were affiliated with unions were nonetheless welcome to approach the airline for direct talks.

"The door remains open to this group should they choose to avail of it," it said.

The ETF and ITF questioned the validity of the direct negotiations. "Are there real negotiations when Ryanair does not recognize trade unions?" it asked.

"It's time Ryanair stopped its anti-union practices, allowed all its workers to freely affiliate to any trade union and eliminated discrimination between members of its staff," said Young.
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Old May 19th, 2005, 05:11 AM   #925
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Ryanair says in talks on UK mobile phone venture

LONDON, May 18 (Reuters) - Irish no-frills airline Ryanair said on Wednesday it was in talks with telecoms network operators about launching its own UK mobile phone business.

Ryanair, which recently banned its staff from charging their mobile phones at work, said it may sell mobile phone connections via the Internet under the plan.

Ryanair Deputy Chief Executive Michael Cawley told reporters the carrier was talking to potential partners for the business, which may not necessarily use the airline's branding.

A source familiar with the talks told Reuters that Ryanair hoped to become a Mobile Virtual Network Operator (MVNOs), which means it would buy airtime wholesale from network partners but own no phone network of its own.

Ryanair had initial talks with 3UK, owned by Hutchison Whampoa , but failed to reach agreement, the source said.

EasyMobile, which is linked to Ryanair rival easyJet , launched its own-brand mobile phone service in Britain in March, while airline entrepreneur Richard Branson's Virgin Group also has a mobile phone business.

Ryanair, which earns ancillary revenues from charging passengers for food, drinks, car hire and hotels, was also looking at gambling and property ventures for new sources of non-ticket earnings.

"Currently we are looking at some gambling products. That is very much at an embryonic stage," Cawley said.

Ryanair is expanding aggressively in Eruope and plans to double passenger numbers by 2012. On Wednesday it launched four new routes to Poland, where it expects to grow dramatically, and one to Slovakia. The airline currently operates 229 routes.

Cawley said it would announce two new bases in June or July.

Ryanair shares were trading 0.3 percent firmer at 6.07 euros in Dublin at 1303 GMT.
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Old May 19th, 2005, 05:13 AM   #926
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Ryanair Mulls New Revenue Streams, Unveils New Routes
By Lilly Vitorovich
18 May 2005

LONDON (Dow Jones)--Irish budget carrier Ryanair Holdings PLC (RYA.LN) said Wednesday that it is reviewing several non-ticket revenue projects in a bid to fill the void left by its failed in-flight entertainment offering.

At a press conference, Deputy Chief Executive Michael Cawley said gambling products, mobile phones, property deals and other options are all being considered by management.

"Currently, we're looking at some gambling products... but that's very much embryonic stage," Cawley said as the airline launched four new routes to Poland and one to Slovakia.

Ryanair last month announced it wouldn't proceed with the roll out of an in-flight entertainment system after an extended trial found that most passengers weren't keen on paying for the console-based service.

With skies crowded by full service and no-frills carriers and the competition driving down ticket prices, generating non-ticket, or ancillary, revenue is becoming increasingly important for the no-frills carriers.

Ryanair has held talks with several companies about a possible deal which would see the distribution of mobile phones via the internet. The service would allow mobile users to make calls in any part of Europe at the lowest cost, according to recent media reports.

"We've talked to lots of people," Cawley said, but cautioned no deal has been signed.

However, he did stress that Ryanair is unlikely to use its own corporate name when it comes to the phone's branding to ensure no damage is done to its corporate name and image, which is synonymous for cheap fairs.

Cawley declined to provide any more details, adding the company is likely to say more when it releases its annual results May 31.

Ryanair's growth has been phenomenal since it was established in 1985 by the Ryan family. It has become a case study for other no-frills carriers around the world.

At present, the Dublin-based airline operates 229 routes to some 20 countries, with 12 European bases. It has a fleet of more than 100 Boeing 737-800 aircraft, with firm orders for a further 125 new planes, which will be delivered over the next seven years, according to its website.

Cawley was upbeat about the group's expansion into Poland, which will take its current one flight daily service to five daily in October.

The new routes to Gdansk, Bydgoszcz, Szczecin and Rzeszow and a new twice-daily service to the Slovakian capital Bratislava from London-Stansted will be immediately profitable, thanks in large part to good deals with airport operators, he added.

In the first year of expanded operations to Poland, Ryanair expects to carry 600,000 passengers, while it expects to carry a total of 34 million passengers in 2005.

Details of more new routes are likely in the next six to 12 months, with Lithuania, Norway, Iceland, Malta, Cyprus, and further routes in Poland all on the radar, Cawley said, adding: "We're very optimistic about growth."

The group is looking to establish two more bases, possibly in Germany, Italy, France, Spain or Poland.

Corrected May 18, 2005 9:16 ET (13:16 GMT) [ 18-05-05 1250GMT ]

Irish budget carrier Ryanair Holdings PLC (RYA.LN) said Wednesday that it is reviewing several non-ticket revenue projects in a bid to fill the void left by its failed in-flight entertainment offering.

("=Ryanair Mulls New Revenue Streams, Unveils New Routes," published at 1250 GMT, incorrectly gave the day as Tuesday instead of Wednesday.) [ 18-05-05 1314GMT ]
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Old May 19th, 2005, 04:13 PM   #927
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19 May 2005

Rise of budget carriers no threat to Singapore's air hub status: analysts
By Jeana Wong, Channel NewsAsia

SINGAPORE : The sprouting up of low-cost carriers in the region does not threaten Singapore's status as an air traffic hub, according to industry experts.

At an industry event, they said they expected to see more growth in the budget airline sector, and that Singapore was well-placed geographically.

But the speed of growth depends very much on how soon air rights can be liberalised.

Budget airlines now serve some 200 spots in the Asia Pacific and the Middle East.

But that is expected to more than double by the end of next year, with international and northeast Asia routes posting the strongest growth.

The expansion is supported by the large population base in the region as well as the economic recovery taking place across Asia.

Situated between Northeast Asia and India, Singapore is right in the thick of the action.

Said Peter Harbison, managing director of the Centre for Asia Pacific Aviation, "What we're talking about here is just massive growth. A lot of this growth is not about replacement; it's incremental, new stuff that would not have otherwise occurred. So I don't see Singapore, in that respect, is being under threat at all. Certainly what they've done in the last 12 months has been a shining light for the rest of the region in terms of what should be done."

Singapore has made efforts to negotiate for more liberal air rights, and is also building an airport terminal just for low-cost carriers.

Industry watchers say heavy regulations in the international arena are now suppressing competition and growth.

Mr Harbison said, "The whole process of removing controls, of liberalising, is that we're going to see a whole lot of different types of airlines. But there will be one thing in common: they will be low cost."

Competition among low-cost carriers is expected to be keen, but with the forecast of huge growth in the budget airline sector, some say that in the near term, we will see more cooperation among the carriers rather than consolidation. - CNA /ct

Copyright © 2005 MCN International Pte Ltd
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Old May 19th, 2005, 06:45 PM   #928
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Grounded pilot back on roster, court told
19 May 2005
Irish Times

Grounded Ryanair pilot Capt John Goss had been re-rostered by the low-fares airline and was back flying, the High Court heard yesterday.

Hugh Mohan SC, counsel for Capt Goss, said his client had only recently learned that he had been put back on the airline's roster and would be taking up flying duties that day (Wednesday) or today.

Mr Justice Barry White was to have given his decision yesterday on an application to jail Ryanair chief executive Michael O'Leary and two other company executives for alleged contempt of court, but said he would not now do so until Wednesday next, May 25th.

Mr Mohan said that the airline bosses had failed to reinstate Capt Goss to flying duties in blatant breach of two previous High Court orders.

Mr Mohan, who appeared with Ms Marguerite Bolger, said Capt Goss had undergone and passed final medical and psychiatric examinations and, as earlier, had been passed as completely fit to fly.

Mr Goss had claimed that Ryanair was in contempt of court and had sought the attachment and committal of Mr O'Leary, Ryanair director of flight and ground operations David O'Brien and Capt Ray Conway, the airline's chief pilot.

He is also seeking an order for the sequestration (seizure) of Ryanair's assets.

Mr Mohan said that, because of the obduracy of Ryanair in its manner of handling the matter following the making of the initial court order, Capt Goss had to bring a second motion for contempt of court. The airline had done everything it could to prevent him from flying and had done so in the face of the order of the High Court.

Since the last court hearing, Capt Goss had attended a medical examination in the Netherlands in order to have his concentration levels tested and had been found fit to fly.

Mr Mohan said Ryanair had been engaged in a war of attrition which it had set out to win on the basis that it believed it was bigger than this one individual. Mr O'Leary, seemed to have left court under some misapprehension and had continued shilly shallying.

Mr Richard Nesbitt SC, counsel for Ryanair, told Mr Justice White that Capt Goss had now been rostered as ordered by the court.

Mr Nesbitt, who appeared with Mr Martin Hayden SC and Mr Mark Dunne, said the issue in the case had always been one of flight safety.

Capt Conway, was now happy that Capt Goss could fly.

"It is exceptionally unfortunate that all that has been put before this court is something suggestive of a dishonestly motivated ruse by Capt Conway, the chief pilot of Ryanair," Mr Nesbitt said.

"There is no satisfactory evidence to merit that finding. The centre of the matter has always been Capt Conway doing his job and trying to do it to the best of his ability."

Judge White said he would give his decision next Wednesday at 10:30am.
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Old May 19th, 2005, 06:47 PM   #929
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Ryanair could have to pay out €44m to pilots
Siobhán Creaton
19 May 2005
Irish Times

Ryanair could potentially face a compensation bill of up to €44 million if the 170 victimisation claims taken by its Dublin-based pilots were to be upheld by a rights commissioner. The first of these cases is expected to be heard in mid-June.

The complaints, some of which have been lodged by the airline's most senior pilots, stem from Ryanair's action in seeking to persuade the pilots to accept terms and conditions attached to their training to fly its new fleet of aircraft.

The initial complaints were first submitted by the airline's eight most senior captains to the Labour Relations Commission last November. Many of the pilots have made multiple complaints.

In the past week, fresh victimisation claims have been made on grounds of the airline's refusal to give the pilots a pay rise. Ryanair said on Tuesday that it had awarded a 3 per cent pay increase to its staff with the exception of its pilots.

It said that the increase, backdated to April 1st, had been granted following "direct negotiations" with its staff last month.

It claimed that the pay rise was awarded to staff who negotiated directly with the company. The pilots are members of the Irish Air Line Pilots Association (Ialpa), which is part of trade union Impact. Ryanair claimed it withheld their pay increase because they had chosen not to negotiate with the airline.

The victimisation claims will be heard by a rights commissioner who has the powers to award a maximum settlement equal to twice the complainant's salary where a claim is upheld.

Ryanair has claimed that its team of pilots are among the highest paid in the airline industry and earn up to €130,000 a year.

Each of the pilots could stand to win compensation of up to €260,000 if successful.

Sources among the pilots suggest that up to 70 further victimisation complaints may yet be taken.

The Labour Court is to investigate a case taken by the Ialpa on behalf of some Ryanair pilots relating to their terms and conditions of employment.

The investigation will centre on the pilots' right to training by the airline, their contracts and rights where redundancies are sought.

The Labour Court findings are binding.

Ryanair is claiming that the new Industrial Relations (Miscellaneous Provisions) Act 2004 cannot be used to enforce trade union recognition against an employer, such as Ryanair, which does not engage in negotiations with trade unions.

The Labour Court accepted this submission but noted that the legislation does provide a measure of protection to employees when pay and conditions are not freely determined by collective bargaining.

Capt John Goss, the pilot who secured an injunction restraining Ryanair from conducting disciplinary proceedings against him pending a full court challenge, was among the group of the airline's eight most senior pilots to lodge the first victimisation claim.

The airline is also fighting a number of separate legal challenges related to its ongoing dispute with its pilots.

These include High Court proceedings it has taken against Ialpa accusing it of conducting an "organised campaign of harassment and intimidation of Ryanair pilots" through a website set up last year for its pilots.

Ryanair has claimed the website, www.repaweb.org , had been a conduit for intimidation of pilots considering flying the airline's new Boeing 737-800 series aircraft to be based in Dublin later this year.

"In addition to threatening and intimidating Ryanair pilots, this website has also published specific threats ... which have been the source of a formal complaint to the Garda Síochána," it said.
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Old May 20th, 2005, 02:04 PM   #930
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Business Times - 20 May 2005

Region's budget airlines not consolidating yet: panel


But sector watchers warn of long-term regulatory hurdles, high fuel costs


By VEN SREENIVASAN

(SINGAPORE) Regional low-cost carriers face some serious long term challenges, but the industry is far from consolidating, say industry watchers who took part in a recent BT Roundtable discussion.

Panelists Peter Harbison of the Centre for Asia Pacific Aviation, Shukor Yusof of Standard & Poors and Nicholas Ionides of the Flight Group noted that the sharp rise in fuel price, regulatory barriers and protectionist instincts of governments posed serious problems for the low-cost carrier (LCC) operators in the region. But those are not serious enough to force a consolidation of the industry just yet, they say.

'I don't think the industry is heading for a premature consolidation,' Mr Harbison said. 'The power of (low-cost air travel) is irresistible.'

But he conceded that the present challenges could cause 'considerable pain' to some operators.

Perhaps surprisingly, panelists identified protectionism and regulatory impediments, rather than high fuel costs, as being the more serious challenge for regional LCCs.

'Flying within the region essentially means crossing international borders,' said S&P's Mr Shukor. 'LCCs can only fly to places where accords already exist. Hence if one wants to start a new LCC, one needs to be sure of getting rights.'

Mr Ionides added that the lack of free skies had prevented LCCs in the region from expanding as quickly as they would like.

'Volume is critical for the low-cost carriers, and they need as much access as possible, especially in the early days when revenue generation is so important,' he said. 'LCCs thrive in truly deregulated markets, and Asia is not even close to being that.'

And the impact of the lack of free skies is already beginning to show.

For example, JetStar Asia deferred taking delivery of four aircraft due to arrive this year after it failed to secure critical new routes to China and Indonesia. The latter made no pretences about its protectionist instincts when it suddenly slapped a blanket ban on all foreign LCCs last month.

Fuel is, of course another major issue that affects both full-service and LCC operators.

'At current levels, jet fuel will make or break an airline - any airline - regardless of it being a start-up or established legacy carrier,' Mr Shukor said. 'The longer oil remains at these levels of over US$50 per barrel, the more acute the problem becomes.'

Despite these challenges, the number of LCCs in the region will increase, say the market watchers.

'The underlying economic growth in this region and the tiny proportion of people who have yet flown makes the potential for growth far beyond levels that anyone can forecast,' Mr Harbison said. 'And this potential can be released almost overnight with deregulation. The faster Asean moves in this respect, the better.

Copyright © 2005 Singapore Press Holdings Ltd. All rights reserved.
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Old May 21st, 2005, 03:26 AM   #931
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May 21, 2005
Indonesia keeps limit on S'pore budget carriers

JAKARTA - THE Indonesian government may let Singapore Airlines (SIA) add flights to Jakarta and Bali, while still limiting overseas budget carriers that want to compete with Garuda Indonesia, a minister said.

The issue of low-fare airlines is on the agenda for discussion next Wednesdaywith Singapore's Transport Minister Yeo Cheow Tong, Indonesian Transport Minister Hatta Rajasa said yesterday in Jakarta.

The ministers will discuss a request to let Singapore-based budget carriers Tiger Airways and Valuair add flights here, and let Jetstar Asia start flights to Jakarta.

The government, which owns and appoints managers to run Garuda, wants to protect the Jakarta-based carrier against mounting competition from Malaysia Airlines, SIA and South-east Asia's budget carriers.

Closely held Garuda, whose board members were replaced by the government in March to boost earnings, recorded a first-quarter operating loss of 139 billion rupiah (S$24.7 million), almost double last year's loss.

'Garuda has burdens from past bad stories...It needs restructuring,' said Mr Enggartiasto Lukito, a member of parliament in charge of transportation affairs.

'In other countries such as France and Singapore, they do protect their flagships. And that's what Indonesia should do, too.'

On May 12, Garuda said it wanted to delay repaying as much as US$523 million (S$872.4 million) in debt owed to European lenders.

If it is successful, it could save up to US$110 million this year in interest costs and principal payment, the airline said. It has debts of US$826.5 million.

The transport ministry said in March that new landing rights applications by overseas budget carriers for Jakarta, Medan, Surabaya and Denpasar will be rejected to protect local airlines.

Applications for the cities of Yogyakarta, Semarang and Bandung will also be rejected; those for other cities are welcome.

Singapore has written to Indonesian officials regarding the issue, Mr Yeo said last month. SIA's partly owned Tiger Airways flies to Padang, the provincial capital of West Sumatra.

Landing rights given to Valuair, which flies to Jakarta, and to Malaysia's AirAsia - South-east Asia's largest discount carrier, which has flights to Jakarta, Medan, Surabaya, Denpasar and Bandung - will not be affected by the restrictions.

The government is also likely to block a request from Singapore for a so-called 'open sky' policy that offers unlimited access to the nation's aviation market, Mr Hatta said.

Singapore 'should not get a no-limit policy', he said.

'The only country that gets the no-limit policy from Indonesia is the United States' because flights to the US are long-distance services that do not compete with Garuda, he added. \-- BLOOMBERG NEWS

Copyright © 2005 Singapore Press Holdings. All rights reserved.
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Old May 21st, 2005, 03:30 PM   #932
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Quite interesting to see this big shots talk about LCCs.....

Business Times - 21 May 2005

Battle for the Asian skies


OVERVIEW

SINGAPORE'S first budget carrier, Valuair, celebrated the anniversary of its first flight early this month. And the region's oldest budget carrier, Malaysia's AirAsia, is now almost four years old. In the last two years, South-east Asia has seen a steady proliferation of low-cost carriers (LCCs). They currently account for 7 per cent of Changi's passenger traffic and fly 175 weekly flights to 15 cities around the region from Singapore. We at The Business Times reckon this is a good time to take stock of how the regional budget airline industry has done, and do a bit of 'crystal-ball gazing' to see how the industry could develop in the next 12 to 36 months.

PARTICIPANTS
in the roundtable

Moderator: Ven Sreenivasan, BT Senior Correspondent

Panelists

# Nicholas Ionides, regional managing editor, the Flight Group

# Peter Harbisob, managing director, Centre the Asia Pacific Aviation

# Shukor Yusof, aviation specialist, Standard & Poor's

Ven Sreenivasan: How has the emergence of budget airlines affected the region?


Peter Harbison: I would call it a watershed. The arrival of LCCs has crystallised the move to liberalise and reform the airline industry, including straightforward relaxation of entry and the innovative cross border joint ventures epitomised by Thai AirAsia and Jetstar Asia. It has also forced a recognition by many flag carriers that there are many areas where they can improve cost structures and service. Some are still in denial, but they are a small minority now.

Nicholas Ionides: Clearly, they've had a significant impact, but it really is still early days as there is much more to come. Once liberalisation efforts are stepped up and some of the barriers to operation come down, there will be much more choice for consumers in terms of air travel. There are tens of millions of people in this part of the world who have never flown, and the new airlines will enable them to travel more.

Shukor Yusof: The major impact has been on consumer behaviour and travel patterns in South-east Asia. It has been a positive outcome for travellers. As flying becomes more affordable, people can spend more on hotels, food, shopping, and so on at their destinations. In places like Phuket there was an immediate benefit after the Dec 26 tsunami as LCCs continued flying in, helping local communities by bringing tourists there.

Ven: Do you think the LCC industry has grown as fast as you expected 12 months ago? And why?

Nick Ionides: In some markets, yes. In others, no. Overall, the growth has been generally as expected - in South-east Asia things are picking up steadily and we're starting to see the new airlines building up decent-sized route networks. The market that has been the biggest surprise is India. After years of failed promises in terms of liberalisation, the government has finally shown that it is committed to opening up the market. As a result, many new airlines are in the process of being launched, and air travel, which has been stifled for so many years, will become a real alternative to ground travel. One statistic sums it up extremely well: in India, the country's airlines only carried around 15 million passengers on domestic flights last year. The country's trains carry the same number each day.

Peter: Given the constraints of international regulation - and the previous 'wisdom' that there could be no international LCCs at all - I think the growth is remarkable. The fact that 7 per cent of Changi passenger movements are with LCCs could not have been imaginable when we held our first LCC conference in February last year. We have gone through the 'crash through' stage and now we are moving into a consolidation phase in South-east Asia, prior to the third phase when inter-government liberalisation really starts to open up the hundreds of city pairs which are ideal for low-cost, point-to-point service.

Shukor: Low-cost airlines grew faster than I expected, probably due to the failure of regional legacy carriers' ability to expand - with the exception of SIA and Cathay.

Ven: What, in your opinion, are the main challenges they face in this region, say, compared to Europe or the US?


Peter: International regulation. Nowhere else in the world has witnessed international LCC operations as we have here. In the European Union, LCCs have unregulated entry and are effectively domestic for these purposes.

Nick: Clearly, when we are looking at international operations, the regulatory barriers are the big challenge. Unlike in Europe, where there is a single market and airlines can essentially fly anywhere they like within the EU with no ownership restrictions, here in Asia there are many restrictions on operations. Bilateral air services agreements are often very restrictive, while ownership rules - that is, that airlines must be effectively owned and controlled by nationals of the country they are from - make things a big challenge for some.

Shukor: Without doubt, the three biggest challenges LCCs here face are the outdated air service agreements, regulatory constraints and the absence of a big network of secondary airports.

Ven: And to what extent will these challenges - especially the regulatory and protectionist ones - pose a serious challenge to the proliferation of more LCC operators?

Peter: In the short term, a considerable challenge, as we are seeing with the reactionary attitudes in Indonesia. But the forces of change are so powerful that, with China also becoming such an influential (and liberalising) player in the region, any setbacks will be temporary.

I am confident that the economic and political force of these operations will stimulate massive change. The underlying economic growth in this region and the tiny proportion of people who have yet flown makes the potential for growth far beyond levels that anyone can forecast. This potential can be released almost overnight, with deregulation. The faster Asean moves in this respect, the better.

Shukor: Flying within the region essentially means crossing international borders. So bilateral agreements are pivotal in determining the expansion of LCC networks. Most LCCs can only fly to places where accords already exist. Hence if one wants to start a new LCC, one needs to be sure of getting rights.

Nick: These challenges will mainly prevent the new airlines from expanding as quickly as they would like. Volume is critical for the low-cost carriers, and they need as much access as possible, especially in the early days when revenue generation is so important. As Shukor and Peter point out, LCCs thrive in truly deregulated markets, and Asia is not even close to being that.

Ven: The fuel price has risen by more than 50 per cent this year, and it remains at a stubbornly high level. The global aviation industry is expected to post a loss of US$5.5 billion as it pays out some US$76 billion for fuel this year. How serious a threat is the rising fuel price to regional LCC start-ups? What is its impact likely to be on the fledgling regional budget airline industry?


Shukor: At current levels, jet fuel will make or break an airline - any airline - regardless of it being a start-up or an established legacy carrier. The longer oil remains at these levels of over US$50 per barrel, the more acute the problem becomes. If oil hits higher levels, around US$60-70, then all bets are off for LCCs. How much more can a budget carrier pass on additional increases to its customers? The exception in Singapore is Tiger Airways, which shares its fuel needs with SIA, so to some extent it has a buffer because of SIA's hedging mechanism.

Valuair will struggle if oil remains at current levels or shoots up. So will Jetstar Asia. AirAsia has already announced plans to impose surcharges but will it be enough for LCCs? This is something we can't predict. Budget carriers can manage, albeit only just, at current oil price levels. A prolonged period of high oil prices could force an LCC out of business. The days of passengers flying for less than the price of a jug of beer may be numbered.

Nick: Rising fuel prices affect low-cost airlines in the same way that they affect full-service airlines, in that they add another fixed cost to the equation. Fortunately, here in Asia, fuel surcharges that many airlines have introduced have not appeared to have affected demand in any real way, so that is at least one positive. While more costly fuel is without question a challenge for regional LCC start-ups to deal with, the serious players will have factored fuel-cost uncertainty into their business planning so they should be able to cope - provided costs do not rise too much more.

Ven: Which operator in the region has the strongest model, in your opinion? Why?

Shukor: Tiger. It is the truest, purest form of low-cost model based on Southwest's tried-and-tested strategy.

Nick: I think the survivors will be AirAsia and Tiger Airways. Why? Because they are true to the 'traditional' LCC model. They do everything they can to keep costs down and offer the lowest-possible ticket prices. Particularly here in Asia, it is important to differentiate from the incumbent full-service airlines. There is a need for both types of airlines as they serve different kinds of travel patterns, but as the experience of Europe shows, differentiation is key.

Peter: AirAsia. Because it has the fundamental low-cost mentality as well as the cross-border base establishment which is essential to expansion for LCCs. It is significant that Tiger is now expressing the intent to enter into similar cross-border joint ventures.

Ven: LCCs here often complain of predatory pricing by full-service incumbents. Do you see a need for a pan-Asian anti-competitive practices legislation?

Peter: Predatory pricing is a legal concept which is notoriously hard to apply in the airline industry. Legislation would be impossible to introduce and almost as hard to apply. The great ability of the larger competitor to price this 'perishable product' (the airline seat, which disappears as soon as the doors are closed) marginally will always provide it with a great advantage. But the interesting fact - which has been repeated over and over - is that the power of the dedicated low-cost model is such that it quickly overwhelms the incumbents' anti-competitive responses. I believe that will also be the case here in Asia, even though the cost differential between incumbents and the new LCCs is not as great as in the US or Europe.

Shukor: The lack of a pan-Asian competition agency is, no doubt, a very negative factor for LCCs. New LCCs in this region are very vulnerable to predatory pricing by bigger players, as Valuair found out when SIA started to slash prices to Bangkok and Hong Kong. So yes, it would be nice to see an authority that deals with this.

Ven: Changi is building a $45 million low-cost terminal. Kuala Lumpur is doing something similar. Others could follow suit. How ideal is Singapore as a regional LCC hub?

Nick: Singapore is without question a strong regional LCC hub, and the government's attitude towards the establishment of new airlines and its support for them are key to this. Having said that, in order to truly thrive, the successful LCCs will have to spread their wings and have multiple bases across Asia - as AirAsia has done with its Bangkok-based Thai AirAsia and Jakarta-based Awair.

Shukor: Yes, it is the perfect hub. Singapore benefits, and will always benefit, from its unique geography - being at the focal point in the region. It has the best airport in South-east Asia, which will complement well the low-cost terminal when that is completed.

Peter: For me, it's not appropriate to talk of an LCC hub. Not yet, anyway. But Changi is a good base for LCCs because Singapore has a liberal aviation policy, a reasonable-cost product, a good outbound and inbound traffic market and fairly transparent process.

Ven: Valuair is considering medium-haul LCC operations (its chairman recently said his airline was eyeing destinations in the east coast of Australia). In your opinion, will the foray into medium-haul work for an LCC model?


Shukor: I hope it will, but I doubt it. Why? Because then it will be at the mercy of additional risks such as fuel prices, as larger jets mean more fuel costs. To be truly successful, LCC operations have got to be kept simple.

Nick: Medium-haul really has yet to be tested by a true LCC, so it remains to be seen whether it will work. Long or medium-haul low-cost is still just a concept, as the cost-saving benefits from operating short sectors with quick aircraft turnarounds and high frequency and so on are lost when going past a few hours' flying time. Those that have spread beyond the short-haul, low-cost model have generally done it by adding a second aircraft type and a business class, so the model by definition changes dramatically. What the airline really just becomes is a more traditional sort of carrier with perhaps a lower cost base than the incumbents because it has started with a clean sheet of paper.

Peter: The move into medium-haul by Asia Pacific LCCs is largely driven by the restrictions of bilateral route access. So it is not a market-driven step in the first instance. But it is essential to bear in mind that what we are witnessing now is not just the entry of LCCs. It is a liberalised revolution in airline (and route) entry of all kinds - in markets which have seen almost no new airlines in the past decade, despite years of high growth. There will be varieties of new airline product, but they will all be characterised by a concentration on costs.

Ven: Some industry specialists say the regional LCC market is in danger of premature consolidation due to protectionism and regulatory impediments (for example, Indonesia has slammed its doors on foreign LCCs, while China and India seem to be dragging their feet). Do you agree?

Nick: Not really, as those that have started new airlines or are establishing them know what the challenges are - if they didn't do their homework they're in the wrong business. From the market's point of view, there is nothing wrong with airlines failing (unless you're an investor, of course), as there will always be someone else looking to have a go and because it tends to make the healthier ones even stronger, allowing them to grow. It is better in my view to have a couple of very strong regional players than it is to have dozens of weak ones fighting for the little access that there is in this restricted market. Over time this will happen in Asia as the market matures - remember that this is still very early in the game, and as with any industry something new takes time to develop.

Peter: No, I don't think it is heading for a premature consolidation. This is a smaller risk than it appears in the very short term (although that may be long enough to cause considerable pain to one or two of the current operators). The power of this force is irresistible.

Shukor: Well, yes and no. Yes, because we're dealing with emerging markets and authorities with little experience of coping with the changing industry. No, because there are positive signs among Asean nations which seem to suggest that it is only a matter of time before some of these barriers are brought down.

Ven: Lastly, what is your prognosis for the regional LCC industry and market in the next three years?


Peter: At least 20 new LCCs in the Asian markets.

Nick: Essentially what we will see is who the players are that are truly in it for the long-haul. I agree fully with those who say the market is only really able to support a handful of key players on a pan-Asian basis, and those that expand aggressively in terms of building up route networks will have first-mover advantage. While there will continue to be multiple players in domestic markets, like Thailand and Indonesia, in terms of true intra-Asia international operations, there will probably only be two or three big players over time. This has been the experience in Europe, and I expect Asia to be the same.

Shukor: In the next three years, I expect low-cost carriers could increase their carry rates of passengers within the region. Lower costs of their point-to-point operations will become more attractive to the younger, more discerning travellers. I don't see LCCs threatening legacy carriers on international routes (such as SIN-BKK) because these are already very competitive and so yields for LCCs will be lower compared to the network carriers flying wide-body aircraft. In Singapore, Tiger will prevail, and Valuair will continue to fly as long as SIA allows it to (what I'm saying is that SIA can quite easily take Valuair out of business if it wants to) and the extent to which Valuair can take losses. As for Jetstar Asia, I'm not really sure. I don't know why it flies to Taipei first when mainland China is the place to be, and when cross-straits relations between those remain tense. Still, I think the LCC sector will grow from its current embryonic stage to a mature, growth stage in three years.

KEY POINTS


# The arrival of LCCs has forced liberalisation and reform in the regional airline industry.

# Regulatory barriers and protectionism remain the major challenges for LCCs.

# A prolonged period of high oil prices could force some LCCs out of business.

# The number of LCC players in the region will double in the next three years.

Copyright © 2005 Singapore Press Holdings Ltd. All rights reserved.
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Old May 23rd, 2005, 01:59 PM   #933
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23 May 2005

Singapore budget carriers eye more Indonesian landing rights
By Dominique Loh, Channel NewsAsia

SINGAPORE : Singapore's budget airlines could get more landing rights to domestic airports in Indonesia, according to reports.

Budget carriers are now eagerly anticipating the outcome of a meeting between Indonesian and Singaporean transport officials, to be held in two day's time.

Indonesian media had reported that the Indonesian government would discuss easing those restrictions imposed on budget carriers earlier this year.

The ban was put in place to protect Indonesia's own carriers.

Singapore budget carrier Valuair has been making a daily return flight to Jakarta for about a year now.

It even increased it to two flights a day by using a temporary permit for about two months.

But that meant Valuair could not do long-term selling of its tickets and it withdrew the second service.

Said Valuair chairman Lim Chin Beng, "Definitely our growth between Singapore and Indonesia had been stunted to a certain extent. It has affected our total growth."

The possibility of opening up Indonesian skies to carriers like Valuair would be a huge boost.

Valuair already has an average 70 percent passenger load to Jakarta alone.

Mr Lim said, "It would be a significant improvement in our total passenger load, revenue. We are not a typical LCC; if we are allowed more points in Indonesia, say Bali, we not only carry Singapore traffic, but from China. I know the Chinese love to go to beaches; since we operate to Xiamen and Chendu, we can sell all the way from China into Indonesia, from Hong Kong, Bangkok, from Perth."

Valuair believes there is a tremendous demand in the Indonesian market not only from tourists but also businessmen.

And if restrictions on landing rights in Indonesia are lifted, Valuair intends to speed up the acquisition of two more Airbus 320s before the end of the year. - CNA

Copyright © 2005 MCN International Pte Ltd
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Old May 24th, 2005, 06:01 PM   #934
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Tuesday May 24, 9:35 PM
EasyJet Half-Year Loss Widens to $40.85M

AP - Low-cost airline easyJet PLC said Tuesday its half-year loss widened because of surging fuel costs, a situation that is unlikely to change this year.

EasyJet said it lost 22.3 million pounds ($40.85 million) in the six months to March 31, extending a 19.7 million pounds loss in the previous corresponding half.

The London-based airline said that a 50 percent rise in fuel costs over the past year had masked other successes, including a 25 percent rise in the number of passengers it carried over the half year to 13.5 million and a 26 percent jump in revenue to 553.3 million pounds ($1.01 billion).

Shares in the carrier fell 4.8 percent to 2.36 pounds ($4.33) on the London Stock Exchange, after it warned that the high oil costs would continue to push pretax profits for the current year to below the level of 2004.

"Fuel now represents 18 percent of our cost base, and the high prices experienced over the winter months show little sign of abating," Chairman Colin Chandler said.

Crude oil prices hit an all-time high of $58.28 on April 4. They have since fallen by around $9 as inventories have risen.

Average fares at easyJet were little changed from a year ago, because of strong competition from rival low-cost carriers. The airline has joined other budget carriers in refusing to impose a fuel surcharge on passengers to pass on the cost, a measure undertaken by British Airways PLC and other full-cost airlines.

There are now 47 low-cost airlines operating in Europe, compared to just seven three years ago, and they are relying on winning more customers through lower fares.

EasyJet said that it still increased revenue per passenger by 16 percent by tapping into other earnings potential, such as in-flight food services.

It has also saved money by adding more fuel-efficient Airbus A319s and withdrawing from poorly performing markets or airports that charge high fees.

The airline has launched 40 routes over the past six months, for a total of more than 150, and started flights to 14 new airports, taking delivery of its 100th aircraft during the half year.

EasyJet sparked concern earlier this month when it announced that chief executive Ray Webster, who steered the group through a stock market listing and the acquisition of rival budget airline Go, is retiring to return to his native New Zealand.

The company also said Stelios Haji-Ioannou, the airline's founder and still a major shareholder, will rejoin the company as non-executive director.
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Old May 24th, 2005, 06:36 PM   #935
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Ryanair boss says summer bookings going well

BELGRADE, May 23 (Reuters) - Ryanair's summer bookings are going well, the budget airline's boss said on Monday, adding he was comfortable with an expected 246 million euro ($311 million) net profit for the year just ended.

"That's the general range of analyst expectations and we are not unhappy with that," Ryanair Chief Executive Michael O'Leary told reporters on the sidelines of the European Bank for Reconstruction and Development's annual meeting in Belgrade.

Ryanair, which is due to publish results for the 12 months to end-March next week, had seen a "fantastic" start to its 2005/2006 business year in terms of summer bookings, O'Leary said.

"If you take the month of May, we expect to have a load factor of over 80 percent and we have said the load factor throughout the summer would be over 80 percent."

Ryanair said earlier this month it had filled 81 percent of seats on its flights during April.

O'Leary, who has been engaged in a long-running war of words with the Irish government in his bid to get a competing terminal built at Dublin airport, criticised plans announced last week to only partially privatise state-owned Aer Lingus [AERL.UL].

"What you are going to privatise is something that the government still hopes to control in some kind of completely screwed-up way ... If you want to privatise it, privatise the bloody thing and get the hell out of it."
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Old May 25th, 2005, 06:22 AM   #936
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Central Europe, Baltics can treble air traffic annually: Ryanair chief

BELGRADE, May 23 (AFP) - Central European countries and the Baltic states recently signed up to the European Union have the ability to treble annual levels of incoming air traffic, Michael O'Leary, chief executive of Irish budget carrier Ryanair said here Monday.

But he stressed that "rapid growth" would be achieved only as long as governments reduced tax levels on tickets alongside better management of airports.

"You need government support for rapid growth," the airline boss told delegates and journalists attending the annual conference of the European Bank for Reconstruction and Development (EBRD), which invests in a number of countries in central Europe and the Baltic states.

"Airports' management should not be out to make a quick profit," O'Leary added.

The animated chief executive said there was no reason why new EU members across the regions, including Poland and Latvia, could not replicate the success of Germany's Frankfurt-Hahn airport by attracting four million passengers over seven years.

They "can grow traffic very rapidly", O'Leary said, adding that their airports should be doubling or tripling air traffic numbers on an annual basis.

"If airports are not doubling or tripling passenger traffic every year, management should be shot," he said to ripples of laughter.

Ryanair recently announced it would begin flying to the Polish cities of Gdansk, Bydgoszcz, Szczecin and Rzeszow later in the year.
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Old May 25th, 2005, 12:26 PM   #937
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45 complaints against budget airline in 10 months, Case reveals

Tiger Airways gets most brickbats

CASE said in the last 10 months it has received 45 complaints against budget airlines but none against the full-service carriers.


By Kor Kian Beng
25 May 2005

CASE said in the last 10 months it has received 45 complaints against budget airlines but none against the full-service carriers.

Tiger Airways topped the list with 32 complaints.

There were eight complaints against AirAsia, four against Jetstar Asia and one against Valuair.

AirAsia was the first to fly from Singapore in February last year, followed by Valuair, Tiger Airways and Jetstar Asia in May, September and December last year respectively.

Case executive director Seah Seng Choon expressed concern over the number of complaints.

He said: 'We are concerned that budget airlines may not be setting aside sufficient resources to deal with customers' issues.'

Mr Seah said customers complained about problems accessing the budget airlines' websites, especially during promotions.

Customers have complained about finding only normal fares available when they expected to pay promotional fares.

There have also been complaints about poor customer service.

Mr Seah urged the budget airlines to take these complaints seriously.

He said: 'If the complaints continue to mount, the image of budget airlines may be affected and this may not be good for the industry in the long run.'

Case said one possible reason for complaints is that the budget airline industry is still relatively new in Singapore.

Consumers have yet to adjust to their service level.

Mr Seah added: 'The aggressive promotions by the airlines themselves over the last few months could have also pushed the demand for their services beyond the level they could cope with.

Agreeing with Case, the Tiger Airways spokesman said: 'Budget airlines have been set up only in the last year. Customers are learning to understand how budget airlines operate.

'They're also starting to adjust their expectations of the services offered by low-cost carriers, after many years of experience of travelling on full-service carriers.'

Jetstar Asia and AirAsia told The New Paper that they are providing quality service since there have been few complaints against them.

Valuair could not be reached for comment.

Said Mr Greg Thompson, vice-president of operations at Jetstar Asia: 'The four complaints made against Jetstar Asia, as compared to the total of 45, serve to highlight the excellent levels of service provided by Jetstar Asia.'

An AirAsia spokesman said: 'Customer service is a top priority at AirAsia, apart from ensuring that high safety standards are met.

'Low fare does not equal bad service. We are constantly monitoring our customer service level.'

TIPS FROM CASE

# Compare the prices and services provided first before booking.

Alert the company if the advertised price differs from the booking price.

# Check the full list of cost items and bear in mind that the ticket price is NOT the only cost item that consumers have to pay. Consumers will be asked to pay for tax, fuel charge etc.

# Read the terms and conditions when booking for tickets. Pay particular attention to alteration costs, cancellation costs and penalty if any.

# Check the airport where the airline is landing. Some budget airlines use peripheral airports instead of the major airport in the city.

# When booking online, always print a hard copy for reference.

# Airline service is covered under the Consumer Protection Fair Trading Act and consumers have the right to seek redress if the airline engages in unfair practices.

Copyright © 2005 Singapore Press Holdings Ltd.
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Old May 25th, 2005, 04:02 PM   #938
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25 MAY 2005

Singapore, Indonesia reach in-principle agreement to expand air rights

By Johnson Choo, Channel NewsAsia

SINGAPORE: Singapore and Indonesia have agreed in principle to work out a mutually beneficial agreement to expand existing air rights between both countries.

This follows Transport Minister Yeo Cheow Tong's meeting with his Indonesian counterpart, Mr Hatta Radjasa, in Jakarta on Tuesday.

In the weeks ahead, the two countries' civil aviation authorities will be ironing out the details.

They will work on increasing the number of flights between Singapore and two Indonesian cities, Jakarta and Denpasar.

In return, Indonesian carriers can expect to have more flights originating from Indonesia to pick up passengers from Singapore before flying on to other countries, otherwise known as fifth freedom rights.

Mr Yeo said: "These are very valuable rights, which most countries guard very jealously. So for Singapore, we'll be happy to give them additional 5th freedom rights if they're prepared to grant us more rights into Indonesia."

Singapore carriers operate 126 weekly passenger flights between Singapore and Jakarta, and 42 to Denpasar.

SIA flies 112 weekly passenger flights while Valuair 14 to Jakarta.

The 42 weekly flights to Denpasar are operated by SIA.

Singapore also hopes to have flights to Jogjakarta and Bandung, and possibly to Medan and Surabaya in the future.

As for Indonesian carriers, Garuda's 234 weekly flights to Singapore are expected to remain, although its fifth freedom right flights will be expanded from the current 40 flights to Ho Chi Minh, Bangkok, Shanghai and Beijing.

But the agreement will not benefit low cost carriers.

Mr Yeo said: "What the (Indonesian Transport) Minister explained was that the high fuel prices have presented a huge problem to the (Indonesian) airlines. As such, they would not like to see the airlines being subject to additional competitive pressures for the time being."

Mr Yeo added that while the restriction on low-cost carriers is still in force, and will only be reviewed in six months' time, both countries recognise the benefits that can be gained.

For Singapore, some 8 percent of the air traffic is made up of budget airline travellers.

For Indonesia, hampered by its limited international links, it stands to gain a boost in its tourist arrival figures. - CNA/ir

Copyright © 2005 MCN International Pte Ltd
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Old May 25th, 2005, 07:19 PM   #939
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EARNINGS POLL-Ryanair yr net profit seen at 248 mln euros
By Kevin Smith

DUBLIN, May 25 (Reuters) - Ryanair is expected to report a strong set of full year results next week on the back of significant route expansion and robust underlying passenger volume growth, analysts said on Wednesday.

Europe's biggest no-frills carrier is seen posting a net profit of 248 million euros ($312.5 million) for the 12 months to end-March versus 206.6 million the previous year, according to the median of 16 forecasts compiled by Reuters Estimates.

Revenue is seen at 1.29 billion euros compared with 1.07 billion in the prior period. Based on figures Ryanair reported for the first nine months of the year, that would equate to net income of 13.4 million euros in the fourth quarter and revenue of 276 million.

Earlier this week Ryanair Chief Executive Michael O'Leary said he was comfortable with net profit estimates of around 246 million euros and that the airline had seen a "fantastic" start to its 2005/2006 business year in terms of summer bookings.

Ryanair had set a full-year net profit target of 200 million euros, which it hit in the first half.

"Capacity growth I would see accelerating over the summer ... so the key focus will be on high oil prices and compensating for that with better yields (average revenue per passenger)," said Stephen Furlong, analyst at Davy Stockbrokers in Dublin.

He said the market would be looking for further evidence of unit cost reduction at the airline, which has been forced by intense competition in the no-frills sector to slash ticket prices, and for progress on ancillary revenue generation. Ryanair earns ancillary revenue from charging passengers for food, drinks, car hire and hotels, and has also looked at gambling, property and mobile telephone ventures for new sources of non-ticket earnings.

Kevin McConnell, head of equities at Bloxham Stockbrokers, said that looking forward, he expected Ryanair to maintain its aggressive strategy against any competitors showing signs of weakness and to continue building its route network and adding to its fleet.

"Ryanair will be suggesting to the market that they believe they're going to grow strongly even though the market may not grow that strongly," he said.

Ryanair is expanding aggressively in Europe and plans to double passenger numbers by 2012. Earlier this month it launched new routes to Poland and one to Slovakia, bringing the number of routes it operates to 229. It now has 12 European bases.

Following is a breakdown of analyst forecasts for Ryanair's full year earnings and revenue, due to be released on May 31.

(All figures in millions of euros)


Code:
                          Net Income    Revenue
 Median                   248.0         1,292
 Average                  248.8         1,292
 Highest Estimate         255.7         1,304
 Lowest Estimate          243.9         1,277
 Number of Estimates      16            18
 Previous year            206.6         1,074
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Old May 25th, 2005, 09:25 PM   #940
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Easyjet rules out surcharge despite rocketing fuel bill
By Alistair Osborne
25 May 2005
The Daily Telegraph

EASYJET yesterday said it had no plans to impose any surcharges on its passengers despite facing a near- pounds 60m increase in its fuel bill this year. The low-fare airline said net fuel costs rose by pounds 17.9m in the first half of its financial year to March 31 and would be expected to rise by a further pounds 41m in the second half at present exchange rates if the oil price remained at about $50 a barrel. The higher fuel price was a key reason seasonal first-half losses rose from pounds 27.3m to pounds 31.2m pre-tax, when passenger numbers increased 25pc to 13.5m year-on-year. Ray Webster, chief executive, said: "We have debated whether we put a fuel surchage on but we do not think we would get any revenue benefits. "At the moment we are getting the benefit of other carriers' fuel chargers.

They are generally applying pounds 6 surcharges on short haul flights and we believe we are getting revenue benefits of about pounds 2 per passenger.'' This is because more passengers were diverting to Easyjet, whose average fares rose last half by just 0.1pc to pounds 38.08. Easyjet has 22pc of its fuel hedged next quarter at no more than $36.2 a barrel and a further cap for 40pc of its fuel should the oil price top $60. Mr Webster, 58, who last week revealed he would be stepping down when a successor is found, reiterated that owing to the rising fuel bill, full-year profits were likely to be below last year's pounds 62.1m. The shares yesterday fell 10 to 238p. He said that total revenue per seat, though up 1.1pc in the first half, was expected to be flat year-on-year at about pounds 37.87 and was not unduly concerned by the consumer downturn. "It's tough, but we are managing,'' he said, adding that Easyjet's "controllable costs are being well managed''. Gross cash rose pounds 127m last half to pounds 637m.
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