Profit rises, but Ryanair warns of Brexit threat
Ireland’s troubled Ryanair says its quarterly net profits rose 12% despite a cancellations crisis but warns Britain is underestimating the risk of “serious disruption” to flights following Brexit.
Profit after tax increased to €106m in the third quarter, the Dublin-based carrier said.
Passenger numbers grew 6% to 30.4-million people.
In another boost, the group forecast passenger traffic would climb 8% to 130-million for the full year, which ends in March 2018. That was up from previous guidance of 129-million.
Ryanair also announced a €750m share buyback, which will begin in February.
“We are pleased to report this increase in profits during a very challenging third quarter,” said CEO Michael O’Leary.
Investors seemed unmoved, with Ryanair shares down 3% in morning trading in Dublin.
O’Leary again acknowledged Ryanair’s “pilot rostering failure in September”.
Ryanair suffered a troubled end to 2017, being forced to cancel 20,000 flights to March 2018, mainly because of botched holiday scheduling for pilots.
The results on Monday came one week after Ryanair signed an agreement to recognise the British Airline Pilots Association, reversing its past hostility towards trade unions.
This was after the carrier said its UK-based pilots had accepted pay increases of up to 20%.
“It became clear in December that a majority of pilots wanted to be represented by unions,” O’Leary said. “In keeping with our policy to recognise unions when the majority of our people wanted it, we have met pilot unions in Ireland, UK, Spain, Germany, Italy, Portugal, Belgium and France to discuss how we can work with them on behalf of our people.”
Similar talks will be held with cabin crew unions.
The cancellations fiasco triggered pilots’ demands for better working conditions and representation, with some departing for other carriers.
As a result of pay hikes, staffing costs are set to jump by €45m in 2017-18.
Ryanair warned that the British government was “underestimating” the risk of flight disruptions that would follow Britain’s departure from the EU in 2019 unless the uncertainty of its future relations were cleared up quickly.
“There remains a worrying risk of serious disruption to UKEU flights from April 2019 unless a UK-EU bilateral or transitional arrangement is agreed in advance of September 2018,” it said.