Ryanair rides out turbulence
RYANAIR stayed on course for record annual profits despite a flight cancellations debacle that will cost it 100 million euros (£88million) a year to pay its pilots more.
The budget airline posted a half-year post-tax profit of 1.29 billion euros and stuck with its annual forecast of 1.40-1.45 billion euros, as it flagged a smaller than previously anticipated fall in air fares and higher spending by passengers on optional services such as reserved seats and priority boarding.
It is also ready to capitalise as it predicts more European airlines going under after the collapse of Monarch, Air Berlin and Alitalia, which has fuelled its growth in Germany and Italy.
Ryanair chief executive Michael O’Leary denied it was short of crews, but admitted a series of poor planning decisions had created a “perfect storm” of one-off pilot shortages, which caused punctuality to plummet and forced it to cancel 20,000 flights, causing disruption to 700,000 passengers from September through to next March.
He said: “The test of any management team is the speed and effectiveness with which they respond to a crisis, and the pilot rostering failure in early September was just such a crisis. We have responded quickly to repair this failure and eliminate further cancellations, and we are determined to invest, the time, money and manpower to ensure that it never recurs.
“These strong half-year results reinforce the robust nature of Ryanair’s lowfare, pan-European growth model even during a period which suffered a material failure in our pilot rostering.”
O’Leary, pictured, hit out at a “campaign of misinformation by competitor airline pilot unions” over its pilot problems, adding: “The reason they wish to denigrate Ryanair is because their airlines cannot compete with us.”
Ryanair lifted half-year revenue by 7 per cent to 4.43 billion euros as it carried 72.1 million customers, up by 11 per cent. The grounding of 25 aircraft will slow growth in the second half to about 4 per cent, reducing annual passenger numbers from 131 million to 129 million.
It expects fares to fall by four to six per cent this year, compared with previous guidance of five to seven per cent. Shares rose 1.01 euros to 16.82 euros.