Ryanair in profits dive
Strikes, pay and Easter get blame
RYANAIR has been knocked off course by a triple whammy of turbulence.
The budget airline yesterday blamed a jump in fuel prices, paying pilots more and the timing of Easter for profits nose diving 20% to £285million in the three months to the end of June.
The Irish carrier is sticking with its guidance of landing a full year profit of between £1.1billion and £1.2bn. But analysts warn that might prove a struggle given the prospect of summer strikes by its own staff and air traffic control disruption.
A third walkout by Ireland-based pilots is planned for today, followed by cabin crew stoppages tomorrow and Thursday, affecting 600 flights to and from Spain, Portugal and Belgium.
Unions say Ryanair is hiring staff in those countries under Irish law, rather than under the laws of each country.
Ryanair said yesterday: “While we continue to actively engage with pilot and cabin crew unions across Europe, we expect further strikes over the peak summer months. We are not prepared to concede to unreasonable demands that will compromise either our low fares or highly efficient model.”
Ryanair went further, warning it may reduce its winter flights in strike-hit countries, leading to job cuts.
The airline, headed by maverick boss Michael O’Leary, grew passenger numbers by 9% to 37.6million in the past three months. That was despite it cancelling more than 2,500 flights because of air traffic controller shortages in the UK, Germany and Greece, and strikes in France. Costs were pushed up by a jump in jet fuel prices and a 20% pay rise for pilots after last year’s rostering fiasco. Ryanair’s average fare dropped 4% but it made 25% more from “ancillary revenues” – add-ons such as priority boarding and food. The airline used yesterday’s update to repeat warnings about what would happen if the UK crashes out of the EU next March, throwing the continuation of flights into chaos. “We bel ieve that the risk of a hard Brexit is being underestimated,” it said.