Irish Ferries saw operating profits halve in the first six months of the year due to soaring fuel costs.
Parent company Irish and Continental Group reported profits for its ferry division down to 3.2 million euros from 6.5 million euros in the same period last year after a 3.1 million euro increase in fuel costs.
The operator of ferries between Ireland and the UK and Continental Europe saw revenue almost static year on year at 68.2 million euros. Higher passenger car and freight revenue was offset by lower foot passenger and charter sales.
Total passengers carried were down 3.6% to 670,500 while cars carried in the first half of 2011 were down 3.1% to 151,600, but at higher yields.
The overall sea passenger market was down 7.5% and the car market was down 6.2%, Irish and Continental said.
The comparative figures for 2010 include the period during which European airspace was closed due to a volcanic ash cloud from Iceland, which had a “significant positive impact” on passenger volumes.
“The passenger market is subject to the current challenging economic conditions, the propensity of consumers to spend and travel and to the competitive threat from short-haul and regional airlines,” the company said.
Looking forward, it added that the economic backdrop remained weak with subdued consumer demand in both Ireland and the UK.
“The Irish Government’s initiative to stimulate the hospitality industry through lower VAT took effect from July 1 and is a welcome development but has yet to show a demonstrable improvement in incoming tourists by sea.”
July and August car volumes were down 7%, with total passenger numbers in line with the same months last year.
“The greatest threat to our financial performance this year is the very significant increase in our fuel cost, following on from the 10 million euro increase in our fuel bill in 2010,” the company added.