DAA upbeat on Cork transatlantic prospects
The DAA is confident that Cork Airport can maintain transatlantic services for the forseeable future, despite Norwegian Air downsizing its long-haul services.
The company, which operates Dublin and Cork airports, said it remains committed to Cork and will continue to invest in the airport, despite it remaining loss-making.
Norwegian Air recently cancelled its winter schedule between Cork and Shannon and Rhode Island on the east coast of the US between November and March due to low demand, although it is still operating a summer service on the same routes.
Speaking at the publication of its annual results, DAA chief executive Dalton Philips said he had been disappointed with Norwegian’s winter cancellations, but remains excited about Cork’s growth opportunities.
He said work is ongoing surrounding the rebuilding of Cork’s connectivity to mainland European airports.
“Norwegian has been very open with us all along, and its winter load factor wasn’t strong enough. It’s a commercial entity and if the traffic’s not there, there’s an obligation on us and other [tourism] stakeholders to build it,” he said.
Mr Philips said Norwegian continues to view its transatlantic services from Cork and Dublin favourably. Load factors for this summer are understood to be strong and the DAA said it is working hard to finalise a summer 2019 schedule, between Cork and the US, with Norwegian.
He said any prospect of Aer Lingus owner IAG buying Norwegian, as has been speculated, should not deter either airline’s growth in Ireland.
The DAA was accused, last year, of using Cork as a way of enticing Norwegian Air to introduce long-haul services from Dublin Airport.
The DAA said 14 new routes launched from Dublin last year, with three starting in Cork. Combined passenger numbers at the two state-owned airports increased 6% to nearly 32 million.
Cork, alone, has seen an 11% rise in passenger numbers in the past two years. Last year, 2.3m passengers used the airport, 3.5% more than in 2016.
Mr Philips also warned that a failure to amend night-flying and outdated noise restriction planning conditions, relating to the planned second main runway at Dublin Airport, could result in the loss of 2.4 million extra passengers “overnight” and the erosion of the airport’s international competitiveness.
Work on the new runway is set to start later this year, with a completion date pencilled in for the end of 2021. Mr Philips said it will act as “Ireland’s new path to the world,” underpinning tourism, trade, foreign investment and post-Brexit competitiveness.
He said the runway is “the most important thing that Ireland will build in a generation”.
The DAA saw revenues rise by 8% last year to €855m. Earnings rose 9.5% to €271m and net debt was down 5% at €541m. After-tax profit grew 16% to €125m, and the DAA has recommended paying the state a dividend of €37.4m for 2017, up from €29.1m for 2016.
The DAA’s update coincided with the Shannon Group announcing that it generates an annual economic impact of €3.6bn, in gross added-value terms, for the economy and contributes €1.1bn in tax revenue to the exchequer.
It said Shannon Airport alone generates close to €1bn per annum.
