Ryanair turns focus to EU hubs in wake of Brexit vote

● First-quarter results show profits up by 4% ● Airline set to ‘withstand any future headwinds’

Budget airline Ryanair is to “pivot” its growth away from UK airports and boost focus on its EU hubs over the next two years following the Brexit vote that it branded a “surprise and a disappointment”.

Ryanair said: “We will pivot our growth away from UK airports and focus more on growing at our EU airports over the next two years.

“This winter we will cut capacity and frequency on many London Stansted routes (although no routes will close) where we are already significantly ahead of our multi-year traffic growth targets.”

Ryanair, which had campaigned for a Remain vote in the EU referendum, also said that Brexit would mean lower economic growth, weaker consumer confidence and put downward pressure on fares until the end of 2017 “at least”.

It added: “Until some clarity emerges over the next two years about the UK’S longterm political and economic relationships with the EU, we will be unable to predict what effect it will have on our business and regulatory environment, but we have contingency plans in place for all eventualities.”

Ryanair’s comments came as it posted its first-quarter results, with profits in the period ending 30 June jumping 4 per cent year on year and customers up by 11 per cent to 31.2 million as it slashed fares. The company’s pre-tax profit grew to €256 million (£214m) from €245m. Revenue jumped 2 per cent to €1.69 billion, while the average fare fell 10 per cent to €39.92, offset by a 9 per cent reduction in unit costs.

Group chief executive Michael O’leary said Easter falling outside the trading period, continued market volatility resulting from terrorist events, and repeated air-traffic-control strikes, especially in France, “weakened fares on close-in bookings and caused almost 1,000 flight cancellations”.

The airline also cautioned in its outlook “that post Brexit there are significant risks to the downside during the remainder of the year” but said it was maintaining its guidance that full-year profits will rise by about 12 per cent to a range of €1.38bn to €1.43bn.

Rebecca O’keeffe, head of investment at stockbroker Interactive Investor, noted the 6 per cent rise in Ryanair’s share price yesterday to €11.59 on the results announcement, “after providing the market with some faith that the airline can withstand any future headwinds through active strategic management, despite concerns and possible downside risks about the postbrexit landscape”.