Ryanair cautious on fuel costs as full-year profit rises

Ryanair has booked a solid increase in full-year profits, but warned that rising oil prices could take the gloss off its performance over the next 12 months.

The budget carrier saw a 10% rise in post-tax profit to €1.45 billion in the 12 months to March 31, while revenue jumped 8% to €7.15 billion.

Passenger numbers were also up, jumping 9% to 130.3 million on the back of falling average air fares, which were down 3% to €39.40.

The solid figures came despite what Ryanair described as a "rostering management failure", when it was forced to cancel flights after mismanaging pilots' annual leave.

The September debacle, which affected 700,000 passengers, came alongside pilot strike action.

Ryanair boss Michael O'Leary said: "We are pleased to report a 10% increase in profits, with an unchanged net margin of 20%, despite a 3% cut in air fares, during a year of overcapacity in Europe, leading to a weaker fare environment, rising fuel prices, and the recovery from our September 2017 rostering management failure."

However, the chief executive also struck a cautious tone over the airline's prospects for the coming financial year, pointing to higher oil prices and Brexit.

Ryanair expects unit costs over the next year to rise by 9% following the surge in oil prices, which have risen to 80 dollars per barrel. It will add more than €400 million to the group's costs.

Staff costs will rise by almost €200 million.

The net result will be a fall in profits to between €1.25 billion and €1.35 billion, Ryanair said.

On Brexit, the Irish carrier again said it continues to plan for a hard Brexit in March 2019.

In that scenario, UK shareholders will be treated as non-EU and this could "potentially affect Ryanair's licensing and flight rights".

As a result, Ryanair intends to "restrict the voting rights of all non-EU shareholders in the event of a hard Brexit", in order to ensure it is majority-owned and controlled by EU shareholders at all times.

"This would result in non-EU shareholders not being able to vote on shareholder resolutions. In the meantime, we have applied for a UK AOC which we hope to receive before the end of 2018," the firm added.

PA


Related Articles

Ryanair starts selling tickets for football games

Ryanair facing action over refusal to compensate strike-hit passengers

Ryanair avoids unions with ultra-low-cost unit

Ryanair traffic up 11% to 10.4m customers for month of November

More in this Section

French government ‘seeks to hire new Renault chief’

Jo'Burger restaurants go into liquidation

Kerry Group buys US ‘clean label’ firms for €325m

Irish mortgage rates end the year as most elevated in Europe


Lifestyle

Renegade cattle make bid for freedom

Preserving the past, looking to future

Allie’s in wonderland

Wild salmon at risk

More From The Irish Examiner