LONDON – Ryanair Holdings PLC Tuesday said it remains cautious about the future as it posted a 24% decline in first-quarter net profit after it was forced to ground flights due to volcanic ash clouds across European airspace.
However, Chief Executive Michael O’Leary said that despite the ash cloud disruption, Ryanair continues to increase its traffic yields, “while most of our competitors are cutting capacity and reporting losses.”
The closure of airspace during April and May this year cost the airline EUR50 million after it was forced to cancel 9,400 flights.
For the three months to June 30, Europe’s largest budget airline posted a net profit of EUR93.7 million, down from EUR123 million a year ago, while pretax profit fell 22% to EUR104.6 million. Fuel costs rose 34% to EUR287 million, reflecting both higher oil prices and a 13% increase in the sector length of average journeys flown.
Ryanair reported a 16% rise in first-quarter revenue to EUR896.8 million. Ancillary sales, or income other than fares, grew 23% to EUR203.9 million, amounting to 23% of total revenues. Diluted earnings per share fell 24% to 8.31 euro cents.
In June, Ryanair proposed a one-off dividend of EUR500 million, or EUR0.34 per share, payable Oct. 1. The dividend is the airline’s first since it went public in 1997, after its foundation in 1986.
Over the past three months, Ryanair shares have shed 3% of their value, closing Monday at EUR3.78.