Ryanair shares fall 13% after low­er­ing of profit pro­jec­tion

Belfast Telegraph - Business Telegraph - - News - BY JOHN MULLIGAN

MORE than €1.8bn (£1.6bn) was knocked off Ryanair’s stock mar­ket val­u­a­tion at one stage yes­ter­day as it slashed its profit out­look.

Chief ex­ec­u­tive Michael O’leary blamed higher oil prices and the im­pact of strike ac­tion, and cau­tioned that fur­ther profit warn­ings could be is­sued if more flight dis­rup­tion oc­curs be­tween now and the end of the year.

Ryanair said it now ex­pects to make a profit of be­tween €1.1bn and €1.2bn in its cur­rent fi­nan­cial year that ends next March.

That’s 12% less than the €1.25bn to €1.35bn it had pre­vi­ously ex­pected to make.

Shares in the air­line tum­bled more than 13% at one point, slash­ing its mar­ket cap­i­tal­i­sa­tion to just over €13bn (£11.5bn).

The air­line boss also said that Ryanair will close a base in the Ger­man city of Bre­men and also in the Dutch city of Eind­hoven. It will also scale back a base in the Ger­man city of Weeze in the Nieder­rhein re­gion as it cuts win­ter ca­pac­ity.

It said it will en­ter con­sul­ta­tions with pi­lots and cabin crew at the bases to min­imise job losses.

“We ex­pect to of­fer our pi­lots va­can­cies at other Ryanair bases, but as we have a large sur­plus of win­ter cabin crew, we will ex­plore un­paid leave and other op­tions to min­imise cabin crew job losses,” said Mr O’leary.

He in­sisted that while Ryanair had com­fort­ably man­aged strikes, the ac­tions had put peo­ple off book­ing flights and also forced the car­rier to sell tick­ets more cheaply in an ef­fort to fill its ex­pand­ing fleet.

“Cus­tomer con­fi­dence, for­ward book­ings and third-quar­ter fares have been af­fected, most no­tably over the Oc­to­ber school midterms and Christ­mas in those five coun­tries where un­nec­es­sary strikes have been re­peated,” he said.

Last week the air­line was hit by strikes by some of its cabin crew in Bel­gium, the Nether­lands, Spain, Italy and Por­tu­gal, as well as some pi­lots in Ger­many.

That saw it can­cel 250 flights last Fri­day.

It has also been hit by other in­dus­trial ac­tion, in­clud­ing in July when some 100 of its pi­lots in Ire­land staged a stop­page.

The ac­tions stem from Ryanair’s con­tin­u­ing at­tempts to ink col­lec­tive labour agree­ments with trade unions across Europe. Ryanair an­nounced in De­cem­ber that it would recog­nise trade unions, a de­ci­sion Mr O’leary said was his.

Driven: Michael O’leary

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