{"id":3478,"date":"2018-10-22T08:25:20","date_gmt":"2018-10-22T08:25:20","guid":{"rendered":"http:\/\/www.styledeals.co.uk\/blog\/ryanair-profits-hit-by-strikes-and-higher-fuel-costs\/"},"modified":"2018-10-22T08:25:20","modified_gmt":"2018-10-22T08:25:20","slug":"ryanair-profits-hit-by-strikes-and-higher-fuel-costs","status":"publish","type":"post","link":"https:\/\/www.styledeals.co.uk\/blog\/ryanair-profits-hit-by-strikes-and-higher-fuel-costs\/","title":{"rendered":"Ryanair profits hit by strikes and higher fuel costs"},"content":{"rendered":"\n
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\"AFP\"Image copyright<\/span>
\n AFP<\/span><\/p>\n

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Image caption<\/span>
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\n Ryanair chief executive Michael O’Leary hopes more smaller rivals will disappear
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Ryanair has blamed strikes by pilots and cabin crew for a slide in half-year profits over the summer, but maintained its forecasts for the full year.<\/p>\n

The airline reported a 7% fall in profits to \u20ac1.2bn (\u00a31.06bn) for the six months to 30 September.<\/p>\n

Profits were also hit by higher fuel costs and what Michael O’Leary called “the worst summer of ATC [air traffic control] disruptions on record”.<\/p>\n

However, traffic rose 6% and its planes were 96% full. <\/p>\n

Average fares slipped 3% to \u20ac46, but ancillary revenues – such as luggage and seat reservation fees – jumped 27% to \u20ac1.3bn.<\/p>\n

‘Worrying effect’<\/h2>\n

After many years of ignoring workers’ attempts to get it to recognise unions, Ryanair finally agreed to do so at the end of 2017.<\/p>\n

However, continuing rows over working conditions led to the airline being hit by a wave of industrial action over the summer by staff in several European countries.<\/p>\n

Mr O’Leary said the strikes had had little impact on its schedules and that rivals such as Air France and Lufthansa had been hit harder by industrial action this summer.<\/p>\n

However, Neil Wilson at Markets.com said strikes were having a “worrying effect on customer confidence … in Ryanair, as evidenced by the weak forward bookings. Progress has been made on securing deals with unions but there is a lot of work to do still.”<\/p>\n

Rising oil prices have also bumped up Ryanair’s fuel bill, eating into profits. The carrier spent \u20ac1.3bn on fuel in the first half of the year, up 22% from a year earlier.<\/p>\n

Earlier this month, Ryanair warned that profits for the full year would be 12% lower<\/a> than previously forecast at between \u20ac1.1bn and \u20ac1.2bn. It reported a record \u20ac1.45bn profit after tax for the year to 31 March.<\/p>\n

“This full-year guidance remains heavily dependent on air fares not declining further – they remain soft this winter due to excess capacity in Europe – [and] the impact of significantly higher oil prices,” Mr O’Leary added.<\/p>\n

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Image copyright<\/span>
\n Reuters<\/span><\/p>\n

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Gerald Khoo, an analyst at Liberum, said Ryanair’s margins were being squeezed by lower average fares and higher fuel and staff costs, but remained at industry-leading levels. “We do not see these being fundamentally undermined by the move to recognise unions,” he added. <\/p>\n

A number of airlines have collapsed in recent weeks, including Primera Air<\/a> and Cobalt<\/a>, and Mr Wilson said Ryanair remained “very well placed to capitalise on the inevitable and long overdue consolidation in the sector”. <\/p>\n

He added: “Consolidation should ultimately be good for Ryanair, but it’s a turbulent ride at the moment.” <\/p>\n

Mr O’Leary told Bloomberg that he hoped that more smaller airlines failed “because they deserve to disappear”. <\/p>\n

He predicted a “very, very difficult winter” for some airlines and also questioned the viability of rivals such as Norwegian, which was paying $85 a barrel for fuel compared with Ryanair’s $68.<\/p>\n

The controversial boss also dismissed the prospect of a no-deal Brexit because it would mean flights being grounded on 1 April – the day after the UK is due to leave the European Union. Such a prospect would cause the government to fall, Mr O’Leary said.<\/p>\n

Shares in Ryanair have fallen by 40% since their peak of almost \u20ac20 last August before the strike action began. Its shares rose 3.6% to \u20ac11.86 in early trading in London on Monday.<\/p>\n

The airline came under fire over the weekend for apparently failing to remove a passenger from a flight after he racially abused a woman in her 70s<\/a>.<\/p>\n<\/p><\/div>\n


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Source<\/a> by [author_name]<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

Image copyright AFP Image caption Ryanair chief executive Michael O’Leary hopes more smaller rivals will disappear Ryanair has blamed strikes by pilots and cabin crew for a slide in half-year profits over the summer, but maintained its forecasts for the full year. The airline reported a 7% fall in profits to \u20ac1.2bn (\u00a31.06bn) for the … <\/p>\n","protected":false},"author":0,"featured_media":3479,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"class_list":["post-3478","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-general"],"_links":{"self":[{"href":"https:\/\/www.styledeals.co.uk\/blog\/wp-json\/wp\/v2\/posts\/3478","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.styledeals.co.uk\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.styledeals.co.uk\/blog\/wp-json\/wp\/v2\/types\/post"}],"replies":[{"embeddable":true,"href":"https:\/\/www.styledeals.co.uk\/blog\/wp-json\/wp\/v2\/comments?post=3478"}],"version-history":[{"count":0,"href":"https:\/\/www.styledeals.co.uk\/blog\/wp-json\/wp\/v2\/posts\/3478\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.styledeals.co.uk\/blog\/wp-json\/wp\/v2\/media\/3479"}],"wp:attachment":[{"href":"https:\/\/www.styledeals.co.uk\/blog\/wp-json\/wp\/v2\/media?parent=3478"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.styledeals.co.uk\/blog\/wp-json\/wp\/v2\/categories?post=3478"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.styledeals.co.uk\/blog\/wp-json\/wp\/v2\/tags?post=3478"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}