Michael O’Leary: Ryanair braced for difficult winter as austerity bites
RYANAIR boss Michael O'Leary admitted today that the low-cost airline was braced for a difficult winter as austerity measures and the eurozone crisis hit demand.
The Dublin-based carrier, which operates more than 1,500 flights a day across 28 countries, is expecting traffic growth of 1pc between September and March, down from 7pc this summer following winter capacity cuts, Mr O'Leary said.
The outlook came as the airline, which expects to carry 79 million passengers this year, reported an 11pc rise in revenues in the quarter to June 30 to €1.3bn as 6pc traffic growth combined with a 4pc rise in average fares.
However, Mr O'Leary said a 27pc surge in fuel costs was behind a 29pc slide in underlying pre-tax profits to €99m in the period.
Ryanair reported a 15pc rise in ancillary sales - which includes baggage and administration fees, as well as in-flight food and drink - to €286m. Ancillary sales now account for 22pc of all revenues.
The carrier, which has a fleet of 294 planes, said growth in the first quarter was dampened by the EU-wide recession, austerity measures and also heavy discounting at new bases including Cyprus, Denmark and Hungary.
The airline will see its 51st base open in Maastricht, in Holland, in December, and it hopes to add up to two new bases later this year.
Mr O'Leary hit out at the Spanish government for hiking airport taxes at the start of July and welcomed a Court of Appeal decision to dismiss BAA's latest appeal against a Competition Commission recommendation to sell Stansted Airport.
Ryanair mounted a fresh bid to seize control of rival Aer Lingus last month by tabling an offer valuing the company at around €694m.
The airline, which already owns a 29.8pc stake in Aer Lingus, requires approval from EU regulators for the deal to go ahead. A previous takeover attempt in 2006 was rejected.
Ryanair said it would be "inappropriate" to comment while the airline is engaging with regulators.