Ryanair falls into red as it warns no-deal Brexit risk is ‘worryingly high’ | Business

Ryanair slipped into the red at the end of last year after intense competition forced it to cut fares across Europe, and reiterated that Brexit could drag down full-year profits.

Chief executive Michael O’Leary described the third-quarter loss of €19.6m (£17.1m) as “disappointing,” but said it was entirely due to a 6% decline in air fares.

Lower fares prompted the Irish budget airline to cut its full-year profit forecast in mid-January for the second time in four months, to between €1.0bn and €1.1bn.

It said on Monday: “We cannot rule out further cuts to air fares and/or slightly lower full-year guidance especially if there are unexpected Brexit and/or security developments which adversely impact fares for close-in bookings between now and the end of March.”

Ryanair said the risk of a no-deal Brexit was “worryingly high”. It has obtained a UK licence to protect its three domestic routes and will place restrictions on shareholders in the event of a hard Brexit to ensure it remains an EU owned and controlled airline.

Europe’s biggest low-cost carrier carried 32.7 million customers in the three months to 31 December, up 8%, and revenues rose 9% to €1.5bn. Ancillary revenues, which include inflight sales, reserved seating, priority boarding and car hire, climbed by 26% but this was offset by higher fuel, staff and customer compensation costs following strikes.

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The carrier said it “did not share the recent optimistic outlook of some competitors that summer 2019 air fares will rise”.

A number of smaller rivals have collapsed in recent months while Flybe, one of Ryanair’s main rivals on British regional routes, accepted a cut-price £2.2m rescue bid from a consortium led by Virgin Atlantic as it tries to avoid becoming insolvent.

Following the acquisition of the loss-making Austrian carrier Laudamotion, Ryanair said it would reorganise its group structure with a small senior management team overseeing four airline subsidiaries. It has extended O’Leary’s contract until July 2024.

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