Ryanair cautious over full year as third-quarter profit falls

Budget carrier Ryanair is expecting a sharp decline in fourth-quarter yields, although it is maintaining its full-year forecast of a Ђ1.3-1.35 billion profit.

It gave the forecast as it disclosed an 8% fall in third-quarter after-tax profit to Ђ95 million.

The airline says it is adopting a “cautious” outlook to the final quarter, given that the 2017 Easter holiday falls outside of the financial year.

Ryanair adds that it expects pricing will “continue to be challenging” over 2017-18.

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The airline says the decline in its third-quarter results, over the three months to 31 December 2016, follows a 17% fall in average fares. Revenues increased by only 1% to just over Ђ1.3 billion.

Chief executive Michael O’Leary says the decline in yields has been “exacerbated” by the drop in the UK currency following last June’s referendum on the UK’s withdrawal from the European Union.

But he points out that, while fares have fallen over the winter, the airline’s load factor rose to 95% over the quarter. Ryanair managed to cut unit costs by 6%, excluding fuel, and unit costs overall fell by 12%.