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Thursday 19 July 2018

Ryanair warns of further disruption as profits rise

The Irish carrier booked a 12% increase in net profit to 106 million euros (£93.5 million) in the three months to December 31.

Ryanair strike
Ryanair strike

By Ravender Sembhy, Press Association City Editor

Ryanair has reported rising third-quarter profits but warned of further disruption to flights as it thrashes out deals with unions across Europe.

The Irish carrier booked a 12% increase in net profit to 106 million euros (£93.5 million) in the three months to December 31.

Revenues rose 4% to 1.4 billion euros while passenger numbers rose 6% to 30.4 million during a period in which Ryanair was forced to cancel flights after mismanaging pilots’ annual leave.

The debacle, which affected 700,000 passengers, came alongside pilot strike action.

Ryanair has since pledged to increase pilot pay by 20% and beef up its cabin crews, a move that will see staff costs rise by an additional 45 million euros (£39.7 million) this year.

The airline also agreed to recognise the British Airline Pilots’ Association (Balpa), the trade union representing pilots.

But Ryanair warned on Monday: “As we finalise union discussions along similar lines to that agreed in the UK, we expect some localised disruptions and adverse PR so investors should be prepared for the same.”

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Ryanair cancellations

The group also pointed to European airline consolidation and bankruptcies – such as Monarch, Air Berlin and Alitalia – which, it said, are providing more growth opportunities in the UK, Italy and Germany in particular.

Boss Michael O’Leary said: “We are pleased to report this 12% increase in profits during a very challenging third quarter.

“Following our pilot rostering failure in September, the painful decision to ground 25 aircraft ensured that punctuality of our operations quickly returned to our normal 90% average.

“While union recognition may add some complexity to our business and may cause short-term disruptions and negative PR, it will not alter our cost leadership in European aviation, or change our plan to grow to 200 million traffic per annum by March 2024.”

The group also announced a 750 million euro (£661.3 million) share buyback and maintained its full-year profit guidance in the range of 1.4 billion euros (£1.24 billion) to 1.45 billion euros (£1.28 billion).

Press Association

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