Budget carrier Ryanair is continuing to adopt a cautious approach, despite a strong first half performance, as uncertainty remains over weak air fares and the effects of the UK’s split from the European Union.
The airline says it is still “comfortable” with its recently-revised full-year guidance, given its currency and fuel hedging positions, but says its visibility on the fourth quarter is “limited” – pointing out that the Easter 2017 holiday period will fall outside.
Ryanair’s post-tax profit for the six months to 30 September 2016 rose 7% to €1.17 billion ($1.29 billion) despite a revenue increase of just 2% to €4.1 billion.
The airline says that, although passenger numbers were up 12%, average fares declined 10%.
Unit costs across the company, however, also fell by 10% – by 5% excluding fuel costs.
Chief executive Michael O’Leary describes the airline’s financial achievements in the first half as a “creditable performance in difficult market conditions”.
But the airline cautions that its full-year guidance depends heavily on there being no unexpected negative impact on fourth-quarter fares, which it already predicts will decline by 13-15% in the second half.
Ryanair has revised its full-year unit cost forecasts, expecting them to fall 3% compared with the previous estimate of 1%.
It believes it will transport just over 119 million passengers this year and it is raising its long-term estimate by more than 10%, predicting that the budget airline will carry over 200 million by March 2024.
Source: Cirium Dashboard
