Ryanair sees profit dented by the soaring price of fuel

RYANAIR, Europe’s largest low-cost airline, posted quarterly profits below market expectations due to higher fuel and operating costs yesterday.

The Irish airline, which operates more than 1,500 flights a day, said it expects average income yields to rise by 12 to 15 per cent in its second quarter ending in September, but warned that traffic would fall four per cent in the next winter season as high fuel costs force the airline to ground flights.

Revenues in the three months to June grew 29 per cent to €1.16bn (£1.2bn), meeting market expectations. But net profit was €139m, well short of the €151m forecast by a panel of analysts. Ryanair maintained its profit forecast for the year of €400m.

Ryanair chief executive Michael O’Leary said: “Fuel prices remain stubbornly high.” Ryanair also has confirmed yesterday it will launch legal action against BAA as it seeks to recover the “substantial overcharges” the airline believes it suffered due to “monopolistic” position of the airport operator. The move comes after regulators won a legal fight ordering BAA to sell Stansted.