Ryanair profits plunge amid fare wars and Brexit uncertainty
Ryanair Holdings has reported a 21% fall in first quarter profits to €243 million, blaming lower fares and higher fuel and staff costs.
It said a 6% decline in average fare was offset by strong ancillary revenues and 11% traffic growth to 42 millon passengers.
Costs rose 19% as the airline group’s fuel bill increased 24% and Lauda costs were fully consolidated.
Ryanair said the two weakest markets were UK ‘where Brexit concerns weigh negatively on consumer confidence and spending’ and Germany ‘where Lufthansa was allowed to buy Air Berlin and is selling this excess capacity at below cost prices’.
It said ancillary sales grew 27% to €0.8 billion, driven by strong priority boarding and preferred seats sales.
As a result, revenue per passenger was broadly flat at €55.
Ryanair said it full year forecast is ‘broadly flat’ in a range of €750 million to €950 million.
"The current weak fare environment has continued into the second quarter and we expect first half fares to be down approximately 6%," it said.
"This guidance remains heavily dependent on close-in second quarter fares, second half prices, the absence of security events, and no negative Brexit developments in the second half."
Bev
Editor in chief Bev Fearis has been a travel journalist for 25 years. She started her career at Travel Weekly, where she became deputy news editor, before joining Business Traveller as deputy editor and launching the magazine’s website. She has also written travel features, news and expert comment for the Guardian, Observer, Times, Telegraph, Boundless and other consumer titles and was named one of the top 50 UK travel journalists by the Press Gazette.
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