Ryanair suffered a 20% slump in spring-quarter profits due to higher fuel and pilot costs combined with average fares falling 4% to €38.68.
Europe’s largest budget carrier saw after tax profits for the three months to June 30 fall to €319 million over the same period last year.
This came despite a 7% rise in passengers carried to 37.6 million, achieved in the face of more than 2,500 flight cancellations blamed by chief executive Michael O’Leary on air traffic control staff shortages and strikes.
Ancillary revenue was up by a 25% with rises in reserved seating and priority boarding services’ income in the three months, with the airline’s overall revenue up 9% to top €2 billion. Ryanair’s digital platform now has more than 1 billion visits a year and continues to grow.
The carrier maintained its full year after tax profit guidance of between €1.25 billion and €1.35 billion.
But O’Leary warned that the projection was “heavily dependent” on summer fares, crew strikes, continuing ATC staff shortages and strikes, the absence of unforeseen security events and no negative Brexit developments.
“We remain concerned by the danger of a hard – no-deal – Brexit in March 2019,” he said.
“While there is a view that a 21-month transition agreement from March 2019 to December 2020 will be implemented and extended, recent events in the UK political sphere have added to this uncertainty, and we believe that the risk of a hard Brexit is being underestimated.
“It is likely that in the event of a hard Brexit our UK shareholders will be treated as non-EU. We may be forced to restrict the voting rights of all non-EU shareholders in the event of a hard Brexit, to ensure that Ryanair remains majority owned and controlled by EU shareholders.
“We have applied for a UK AOC to protect our domestic UK routes and hope to receive it before the end of 2018.”
Ryanair passengers should also prepared for further strikes over the summer by pilots and cabin crew, with a third walkout by Irish pilots tomorrow (Tuesday) followed by action by cabin crew in Spain, Portugal and Belgium the following two days.
O’Leary said: “While we continue to actively engage with pilot and cabin crew unions across Europe, we expect further strikes over the peak summer period as we are not prepared to concede to unreasonable demands that will compromise either our low fares or our highly efficient model.”
He added: “If these unnecessary strikes continue to damage customer confidence and forward prices/yields in certain country markets then we will have to review our winter schedule, which may lead to fleet reductions at disrupted bases and job losses in markets where competitor employees are interfering in our negotiations with our people and their unions.
“We cannot allow our customers’ flights to be unnecessarily disrupted by a tiny minority of pilots.”
Ryanair hopes to raise its stake in Austrian carrier LaudaMotion from 24.9% to 75% within weeks after gaining EU competition approval.
The Vienna-based carrier is expected to lose about €150 million this year financial and not break even until its third year of operations.
O’Leary blamed “considerable damage” caused by Lufthansa in a row over leasing aircraft to LaudaMotion and “substantial cost headwinds” due to rising fuel prices.
More: Ryanair cancels 600 flights ahead of strikes