Ryanair announced yesterday that First Quarter traffic grew 6 percent and average fares rose 4 percent. However, profits were down 29 percent amid stabbing fuel costs.
Ryanair CEO Michael O’Leary:
“As we previously guided, significantly higher fuel costs caused Q1 profits to fall by €40m (from €139m last year’s) to €99m. Our 6% traffic growth combined with a 4% rise in ave. fares led to an 11% increase in Revenues. Ancillary sales grew by 15% to €286m (outpacing traffic growth) accounting for 22% of total revenues.
Operating unit costs rose 10% as fuel increased 27% (by €117m) to €544m. Fuel amounted to 47% of total operating costs. We were hedged at $820 pt in Q1 last year compared to $1000 pt this year a price increase of 22%. As a result Q1 will suffer the largest fuel cost rise in FY13 as the pricing differential narrows significantly over the remaining three quarters of the year.
Despite this challenging environment Ryanair continues to grow its traffic across Europe while maintaining the lowest unit costs in the airline industry, and generating healthy profits as evidenced by the 8% after tax margin achieved in the first quarter.”