Ryanair has revealed the wounds it has suffered after being forced to slash fares to boost passenger demand and battle rivals, with the budget carrier posting a profits slump and putting flier freebies “under review”.
Average fares between October and December fell faster than initially planned, Ryanair said, plunging by 17% to €33 (£28) per passenger.
The resultant 16% traffic surge to 29 million fliers wasn’t enough to redress the balance.
More passengers paying far lower fares meant profits, after tax, fell 8% to €95 million in the third quarter, worse than the City had expected, and shares fell 1.9% to €14.49.
Europe’s biggest budget airline is sticking — for now — to its forecast for post-tax profits for the year to April of €1.3 billion to €1.35 billion.
But chief executive Michael O’Leary conceded the guidance relied on a turbulence-free final two months and no “security events” hitting late bookings.
Ryanair also warned that passenger charges could rise as it reviews services such as the two free carry-on bags. It said these were causing boarding delays as punctuality fell from 90% last year to 88% over the past nine months.
But Brexit has been Ryanair’s biggest problem, since about a quarter of its bookings are made in sterling, but the Irish carrier books earnings in euros.
