Aurigny expected to lose around £1.5m. this year

The airline made a profit of £1.5m. in 2023. That was its second year in the black, after years of losses totalling tens of millions of pounds.

But higher costs for leasing aircraft in the first half of 2024 are set to put it back in the red by the end of the year.

‘It’s always dangerous guessing financial outcomes, but I believe Aurigny will lose money this year, probably roughly equivalent to the profit they made last year,’ said States Trading Supervisory Board president Peter Roffey.

‘That would mean they would roughly have broken even over a two-year period and break-even is the target from this Assembly.’

Deputy Roffey’s board, which is Aurigny’s sole shareholder on behalf of the States, was questioned about the airline’s current financial position by Simon Vermeulen at this week’s States meeting.

He asked for assurances that no ‘secret losses’ were on the horizon after Aurigny experienced a torrid first half of the year, which included unprecedented disruption to flights and poor customer service.

‘There will be a very considerable bill for the wet leasing, obviously exacerbated by damage to the front landing gear of one of Aurigny’s own aircraft which was then out of action for a very long time through lack of parts,’ said Deputy Roffey.

‘Of course they had to wet lease. If they hadn’t done that, the situation would have been much worse.’

Deputy Vermeulen, who leads on tourism for Economic Development, has been a consistent critic of Aurigny and recently questioned whether chief executive Nico Bezuidenhout should be replaced.

But the political heat on the airline has eased slightly in recent weeks, with disruption easing following the announcement of a recovery plan in late May.

In the Assembly, Deputy Roffey again apologised to Aurigny’s customers and defended the airline’s record under Mr Bezuidenhout, who took over in 2020.

‘The policy letter in 2021 set out the plans which the new chairman and chief executive had to turn around the airline’s financial performance and return it to break even,’ he said.

‘I suspect the reliability problems experienced earlier in the spring will be a setback in that regard, at least for 2024. As shareholder, the STSB’s clear direction to Aurigny was to prioritise minimising disruption ahead of the short-term costs.

‘But I am confident we will see considerable benefits in future years, with a more streamlined airline that is financially self-reliant securing our vital airlinks and supporting our business and hospitality sectors with great connectivity and reliable travel options.

‘Aurigny has traditionally delivered excellent reliability and punctuality and I am sure it will do so again.’

Economic Development wrote to Aurigny earlier this year asking if it had enough aircraft to manage its extensive network of routes and for an explanation of what it considered high ticket prices on some services.

Deputy Roffey told the States the airline was holding down fares as much as it could.

‘As for the cost of travel, fares have actually been rising at levels below RPI,’ he said.

‘In the first half of 2024, excluding the seasonal European routes, more than two-thirds of seats across the Aurigny network cost less than £100.’