Budget airline Ryanair has issued a profit warning, announcing that it expects full year results to show profit at the lower end of the expected range of €570m to €600m (£482m to £508m).
Full year traffic is also expected to come in lower at 81 million from 81.5 million previous.
CEO Michael O'Leary said that bookings in July were showing weakness versus expectations as a result of both the summer heatwave and foreign exchange impacts.
Looking ahead, O'Leary sees the next few months posing a challenge to the low-cost carrier, with a "perceptible dip" in fares and yields into September, October and November.
The booking pattern returned to some normality in August, which will ensure that our H1 guidance remains unchanged, which is for a small increase in H1 profits over the prior year H1 comparable.
Joe Rundle, head of trading, ETX Capital:
For budget airlines like Ryanair, earnings-performance tends to be seasonal with greater pick-up in volumes during the spring/summer months and equally, lower volumes in the autumn/winter months. The fact that Ryanair signals ongoing weakness in the months ahead during the busy summer season, investors are likely to express their concern about the outlook for earnings. Consensus forecasts are also likely to be adjusted on the back of this release.
It’s a disappointing release from the airline industry which is currently also feeling the pressure on the increase in oil prices due to geopolitical tensions in the Middle East. European airlines could see a further deterioration to profits if we see a Western military intervention in Syria for a protracted period. Today’s warnings by Ryanair in that case, may be echoed by its peers in the months ahead.