Ryanair said on Monday said it profits were hit by lower fares due to high competition, unusually hot weather in Europe, the World Cup and uncertainty caused by pilot strikes.
Lower summer fares combined with higher staff and fuel costs caused profit to fall by 20% compared with last year in the three months to the end of June, the first quarter of its financial year, it said.
“While Q1 fares were marginally stronger than previously expected, the recent weaker fare environment and the expected impact of crew strikes on forward pricing mean that Q2 fares will only rise by approximately 1%,” Chief Executive Michael O’Leary said in a statement.
He said the weaker environment was “due to the World Cup, the Northern European heat wave and customer uncertainty about pilot strikes”.
Ryanair suffered its worst-ever week for strike action, with over 300 of its daily 2,400 flights cancelled last week due to action by cabin crew in Spain, Portugal, Italy and Belgium.
Pilots in Dublin are set to strike on Tuesday, while cabin crew in Europe will strike later in the week.
Ryanair, which flies in 37 countries and carried 130 million passengers last year, averted widespread strikes before Christmas by deciding to recognise trade unions for the first time in its 32-year history. But it has since struggled to reach agreement on terms with several of them.
“While we continue to actively engage with pilot and cabin crew unions across Europe, we expect further strikes over the peak summer period,” O’Leary said.
O’Leary said the airline would consider moving planes from some markets, including Ireland, if disruptions continue and that this could lead to job losses. “We cannot allow our customers flights to be unnecessarily disrupted by a tiny minority of pilots,” he said.
Ryanair forecast profit for the year to be between €1.25 bln and €1.35 bln, down from a record 1.45 bln in the year to March 31.
In May the airline forecast a 5% decline in average fares in the first quarter and a rise of 4% in the second quarter. On Monday it said fares fell 4% in the first quarter but would rise by only 1% in the second.
