ECONOMY

Aegean Airlines to keep losing money in 2011

Greece’s Aegean Airlines expects to continue operating in the red this year, after reporting a net loss of 23 million euros in 2010, according to brokers.

In a morning note on Wednesday, Proton Research cited Aegean Airlines? management as telling analysts in a conference call on Tuesday that poor economic conditions, increasing fuel prices and international expansion plans will weigh on earnings figures.

However, the airline, which operates fleet of 26 aircraft, expects domestic demand in the sector to stabilize during the year, Proton Research said.

Earlier this month, the company announced that it will launch flights from Cyprus to London Heathrow as part of expansion plans. It also recently purchased four slots from local rival Olympic Air at the airports of Heathrow and Paris’ Charles de Gaulle.

Airport slots are rights allocated to a company granting the slot owner the right to schedule a landing or departure during a specific time period.

As a means of surviving the downturn, Aegean Airlines had planned to merge with Olympic Air, however, the European Commission blocked the proposed deal on concerns that it would harm competition in the local market.

Shares in Aegean Airlines have lost some 13 percent on the Athens bourse in the last six months, versus gains of two percent in the broader market.