Ryanair posts higher profit but warns of Brexit risks
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Chief executive Michael O’Leary said the Irish carrier faced “difficult” trading as the group posted profits of €1.31 billion (£1.14bn) for the year to the end of March.
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Hide AdRyanair slashed fares by 13 per cent on average over the year amid competition in the industry and expects to reduce fares by a further 5 per cent to 7 per cent due to the weak pound and as it passes on lower fuel costs.
The group said the year was marred by terrorist attacks across Europe, confirming flight bookings fell in the aftermath of the terror attack at the Manchester Arena last week. Bookings have started to recover as Ryanair launched seat sales in response to the fall in demand.
The airline said it also saw “strong bookings” over the weekend after an IT failure hit rival British Airways.
Ryanair is “cautiously” forecasting profits to rise by 8 per cent to between €1.4bn and €1.45bn for the year to next March.
But O’Leary warned: “Investors should be wary of the risk of negative Brexit developments, or any repeat of last year’s security events at European cities, which could damage consumer confidence, close-in bookings, and this full-year 2018 guidance.”
He added the group would “continue to pivot our growth away from the UK” amid uncertainty caused by Brexit.
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Hide AdRyanair reported a 13 per cent rise in annual passenger numbers to 120 million, but admitted it was impacted by delays due to air traffic control strikes and weather disruption at the end of last year. Its punctuality fell to 88 per cent, from 90 per cent the previous year.
The Dublin-based carrier, which flies 1,800 daily flights across 33 countries, is targeting 130 million passengers over the year ahead, suggesting a slowdown in growth to about 8 per cent.
While Ryanair’s profits rose to another record high, the group took a hit from the weak pound since the Brexit vote as ticket sales in sterling are worth less in euros.
It warned over profits last October after fares fell more than expected, while airlines have also been knocked by a price war and a shift away from popular destinations Egypt and Turkey after terrorist attacks and political turmoil.