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Record 1.32bn Euro net profits for Ryan air
Posted on 30/05/2017

TransportUnited Kingdom

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Passenger numbers for Europe's biggest budget airline were up by 13% in the year ending March 2017 an official report has concluded. This comes in despite of Brexit insecurities and terror attacks which could potentially harm the tourism industry.

Hard Brexit risk means future is still uncertain

Hard Brexit risk means future is still uncertain
stegarau/123RF

The Irish airline has 1,800 daily departures across 33 countries and between March 2016 and March 2017 it carried a total of 120 million passengers. On average, the profit per passenger was totaled at 11 euros.

Last year saw the company reduce ticket prices due to a weaker sterling as well as means of keeping up competition with other airlines. Indeed, since the EU referendum vote last June, the Sterling has dropped by about 16% against the dollar, so the tickets the airline sells in sterling are worth less in euros. Prices were also cut to offer incentive for tourists to continue travelling to European cities where increasingly common terrorist incidents are having a negative impact on the travel industry.

The CEO of Ryanair, Micheil O'Leary, acknowledged that the airline had faced a number of problems, he affirmed that "despite difficult trading conditions caused by a series of security events at European cities, a switch of charter capacity from North Africa, Turkey and Egypt to mainland Europe, and a sharp decline in Sterling following the June 2016 Brexit vote. We reacted to these challenges by improving our customer experience, and stimulating growth with lower fares."

Furthermore, bad weather, air traffic control staff shortages and strikes have all created reliability problems. Over the course of the year, the number of on-time flights dropped from 90% to 88%. A spokesperson for the airline pointed out that "In March alone, a series of unjustified ? strikes caused almost 560 Ryanair flight cancellations, and the loss of over 100,000 customer bookings,"

But, the airline remains optimistic and an 8% increase is predicted in the 2018 profit.

However, this positive growth could be affected in the near future. Therisk of a hard Brexit, with no trade deals for U.K and leaving the single market, poses a significant concern for forecasters.

As the future of the post-Brexit Britain is currently uncertain, Ryanair is planning to become less centralised in the U.K and branch out. In 2018, a spokesperson confirmed that they are looking "to capitalise on the many growth opportunities elsewhere in Europe"

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