Ryanair to shift growth away from UK as profits rise
Ryanair announced today that it will continue to shift its growth away from the UK due to the potential disruption caused by a ‘hard’ Brexit, which it warned had led to uncertainty over flights between the UK and the EU from March 2019.
As it revealed that its annual pre-tax profit had risen 6% to €1.32 billion following a 13% rise in traffic to 120 million passengers and a 11% fall in costs, the airline said it needed to capitalize on ‘the many growth opportunities’ outside the UK.
Ryanair has recently announced the launch of Ryanair Sun, a charter airline which will have a Polish air operating licence and management team. It will launch in summer 2018 with a fleet of five aircraft.
"For our customers, we hope the UK will remain in Open Skies which will mean no change for UK consumers and visitors. However, the UK has indicated that it does not wish to do so, and until we get clarity over the final terms of the UK’s future trading relationship with the EU, there must be significant uncertainty over flights between the UK and the EU for a period of time from March 2019 onwards," said chief executive Michael O’Leary.
A ‘hard’ Brexit could cause significant disruption to UK/EU flights for a period of months after March 2019, which is why we must remain flexible.
"In the absence of such certainty, or direction, we will continue to pivot our growth away from the UK in 2017 and 2018 to capitalise on the many growth opportunities elsewhere in Europe.
"We have contingency plans and will adapt to changed circumstances in the best interests of our customers."
O’Leary said the increase in profits for the year to the end of March had been achieved ‘despite difficult trading conditions’, including a series of security events in Europe, a sharp decline in sterling and the switch of charter capacity from north Africa, Turkey and Egypt to mainland Europe.
"We reacted to these challenges by improving our customer experience, and stimulating growth with lower fares," he said, adding that fares fell 13% to an average of €41.
As a result of the fall in ticket prices, the airline’s load factor rose to 94%, which it claimed was the best in the industry.
Ryanair has recently announced the launch of ~Ryanair Sun, a charter airline which will have a Polish air operating licence and management team. It will launch in summer 2018 with a fleet of five aircraft.
During the year to the end of March, ancillary revenue grew by 13% to €1.8 billion and accounts for 27% of total revenues. Ancilliary sales are expected to rise to 30% of total revenues by March 2020, Ryanair has said.
Linsey McNeill
Editor Linsey McNeill has been writing about travel for more than three decades. Bylines include The Times, Telegraph, Observer, Guardian and Which? plus the South China Morning Post. She also shares insider tips on thetraveljournalist.co.uk
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