Alpha in-flight profits still in tailspin

Alpha Airports, the in-flight caterer and airport retail operator, reported a 16% fall in pre-tax profits in 2003, as its in-flight meals service continued to struggle.

The company said that its pre-booked on-board meals service remained problematic and unprofitable, although its airport shops put in a stronger performance.

Alpha said that the take-up of in-flight meals rose by 73% where package holiday companies offered holiday-makers the chance to pay extra for a meal, but providing the service on charter flights had caused "uncertainty, complexity and thus indirect costs".

Nevertheless, Alpha said that it was pleased with the trial of its online meal service, Alpha D'Lish, on Virgin Express flights out of Brussels.

The service, which will roll out to the UK later this year, allows passengers to order a meal when booking their flight online.

Alpha is marketing Alpha D'Lish as a "high-quality meal service available on low-budget flights".

During the 12 months to 31 January, Alpha's UK flight services division saw sales fall by 8%. Overall, the flight services division, which includes on-board retail, registered a 0.6% reduction in sales to £244m and a 44% reduction in pre-tax profit to £9.5m.

The company made 90 redundancies in its flight catering division last year, costing £2.9m, including a settlement with former director Robert Stephenson.

Improved performance from its airport shops meant that Alpha's overall turnover for the year increased to £440.9m (2003: £419.3m) while pre-tax profits fell to £17.4m (2003: £20.7m).