lowfaresbuster
28th Jan 2004, 17:37
down 22% this morning
LONDON (ShareCast) - Ryanair (Dublin: RYA.I - news) went into a flat spin on a warning full-year profit will fall around 10% because of fierce competition in the no-frills airline business.
Shares in the group slumped more than 23% as it said net income would decline to around EUR215m in the year to March reflecting recent slashed ticket prices.
It is the second blow to airline this week. Yesterday it shares also dived after it warned that it could lose all subsidies from publicly-owned airports following a ruling that a subsidy it received from Charleroi airport is illegal.
Passenger numbers remain strong, Ryanair carried 2.01m passengers in December compared with 1.31m during the same period a year ago, but yields, or the amount of money it earns per flight, are under severe pressure
Chief executive Michael O'Leary said, "We remain very cautious in our outlook for fares and yields,'' adding "Our response to these market conditions will be to continue to lower fares and yields.''
Traffic for the quarter grew by 54% to 6.1m, whilst average fares declined by 11%. Meanwhile total revenues rose by 37% but operating costs rose by 42%.
"Early indications for yields in our fourth quarter suggest a marked further reduction of between 25% to 30%," it added.
LONDON (ShareCast) - Ryanair (Dublin: RYA.I - news) went into a flat spin on a warning full-year profit will fall around 10% because of fierce competition in the no-frills airline business.
Shares in the group slumped more than 23% as it said net income would decline to around EUR215m in the year to March reflecting recent slashed ticket prices.
It is the second blow to airline this week. Yesterday it shares also dived after it warned that it could lose all subsidies from publicly-owned airports following a ruling that a subsidy it received from Charleroi airport is illegal.
Passenger numbers remain strong, Ryanair carried 2.01m passengers in December compared with 1.31m during the same period a year ago, but yields, or the amount of money it earns per flight, are under severe pressure
Chief executive Michael O'Leary said, "We remain very cautious in our outlook for fares and yields,'' adding "Our response to these market conditions will be to continue to lower fares and yields.''
Traffic for the quarter grew by 54% to 6.1m, whilst average fares declined by 11%. Meanwhile total revenues rose by 37% but operating costs rose by 42%.
"Early indications for yields in our fourth quarter suggest a marked further reduction of between 25% to 30%," it added.