June 25, 2017

Ryanair 3Q profits dip, but full-year figures unchanged

07 February 2017, 01:16 | Ignacio Smith

Ryanair 3Q profits dip, but full-year figures unchanged

Ryanair 3Q profits dip, but full-year figures unchanged

Ryanair has said it had to cut its fares more than expected during the last three months of 2016, which pulled down profits. It said these were causing boarding delays as punctuality fell from 90% previous year to 88% over the past nine months.

Chief executive Michael O'Leary attributes the fare drops to increased market capacity, terror events and the weaker Sterling since the UK's vote in June to exit the EU.

Average fares between October and December fell faster than initially planned, Ryanair said, plunging by 17% to €33 (£28) per passenger.

The sharp fall in the British currency after the country's vote to leave the European Union has also hurt carriers exposed to the pound.

Net profit for the quarter fell to 94.7 million euros from 102.7 million euros a year earlier, but was partially offset by an increasing demand from consumers.

The Dublin-based airline said sales for the quarter barely rose, even as it carried 16% more passengers.

However, it said it was "maintaining its full-year profit guidance in the range of 1.30bn to 1.35bn euros".

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"That said, Ryanair is very focused on our costs and you would have seen in the quarter our unit costs, excluding fuel, were down 6 per cent at a time when our competitors are actually seeing their costs rise".

"Our headline case is that we don't expect to grow as quickly in the United Kingdom as we would otherwise have done on the fault of Brexit - because there (are) too many uncertainties there", said Chief Financial Officer Neil Sorahan at a press conference in central London.

However, Ryanair said the outlook for the remaining two months of the year was cautious.

"While there may be opportunities to expand at certain United Kingdom airports (such as the recent extension of our growth deal at Stansted), we expect to grow at a slower pace than previously planned in the United Kingdom".

Ryanair wants the United Kingdom to remain in the EU's open skies system, which allows any member-state registered airline to fly anywhere within the bloc, but has suggested that this may not be possible.

As such, Ryanair said that while there may be opportunities to expand its presence at United Kingdom airports, it anticipates growing at a slower pace than previously expected in the United Kingdom and will continue to switch capacity growth to other key European markets.

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