Ryanair Q3 profits down 26%
Ryanair today unveiled a 26% fall in third-quarter net profits to €35m (£24m) after it was affected by record fuel prices and intense competition.
The airline warned that fuel costs would continue to impact it in the future but added that it was still growing “strongly and profitably” in spite of the adverse market conditions.
Ryanair also revealed today that passengers had failed to tune into a new onboard entertainment service offering videos and music for about €7 (£5) per flight.
The no-frills carrier said an initial lack of availability of non-English language content programmes contributed to the “disappointing” trial, and meant the system may not be rolled out to the entire fleet.
The airline said that passenger volumes grew by 13% to 6.9m while yields were in line with the same quarter last year. As a result, total revenues rose by 15% to €294.4m.
Unit costs rose by 26% due to the increase in the level of activity and in particular higher fuel and route charges, Ryanair said.
During the quarter, maintenance provisions of €4.5m (net of tax) were released to the profit and loss due to the earlier-than-scheduled return of six leased 737-300’s. As a result, Q3 net profit declined by 26% and the Q3 profit margin after tax declined by 7 points to 12%.
Ryanair boss Michael O’Leary said: "We continue to maintain our record of 31 consecutive quarters of unbroken profitability (before exceptionals) since we floated in May 1997.
"Despite intense competition, yields were similar to those achieved last year and better than our previous guidance of a decline of between 5% to 10%. We believe this is due to capacity removals by competitors and the continuing impact of multiple fuel surcharges imposed by many of our high-fare competitors."
