Union deals by end of year, Ryanair says
DUBLIN (Reuters) – Ryanair hopes to reach deals with all of its major unions by Christmas, its chief executive said on Monday, in a sign an end may be in sight to disruptions which have hit its profit and shares.
The Irish low-cost carrier, Europe’s largest, on Monday reported a 7% fall in profits in the six months to September 30 on high fuel costs and intense competition.
But it said these factors were helping it to resolve its industrial relations troubles.
“Given the adverse environment that’s out there for airlines and the number of job losses being reported in recent weeks both by pilots and cabin crew, there is a much more sensible, common sense approach being taken by the unions,” Chief Executive Michael O’Leary said in a video presentation.
O’Leary said that recent progress in talks left Germany and Belgium as the only two large markets for the airline where recognition agreements had not been secured.
“We would be hopeful of concluding agreements with them this side of Christmas,” he added.
The fall in profit was less than the 9% drop forecast by analysts, and Ryanair shares were 4.2% higher at 12.00 euros at 11:00 a.m. GMT.
Ryanair’s shares are almost 40% down from a peak of 19.39 euros in August last year before the industrial relations issues began.
A staff revolt forced management to recognize unions for the first time last December and the airline has since struggled to put in place union recognition agreements.
A spokesman for Belgium’s LBC-NVK union said it was waiting for an offer from Ryanair on Thursday, and had warned the airline they could strike again if there is no progress.
A spokesman for German unions VC said he saw “no real progress” in talks with Ryanair, which also needs to secure recognition deals in the Netherlands and Sweden.
On Friday, it said it had reached agreement with British, Portuguese and Italian pilots and was close to a deal with Spanish pilots, although the British union said the deal had not been approved by its members yet.
Ryanair issued a profit warning on October 1, citing damage to bookings from strikes and cutting its forecast for full-year profit by 12%. But on Monday, O’Leary said much of the weakness of recent weeks was sector-wide rather than specific to Ryanair.