RYANAIR IS considering cutting its capacity at Irish airports further this year as its standoff with the Government continues in relation to airport charges and the €3 travel tax.
This news was delivered as the company exceeded market expectations by reporting a €14.9 million after-tax profit for the three months to the end of December, the third quarter of its financial year.
Ryanair also increased its profit guidance for the full year to €480 million from €440 million previously.
Deputy chief executive Howard Millar said yesterday that it “may reduce capacity further out of Ireland”.
“We haven’t made a definitive decision but I expect we could reduce capacity by another one or two aircraft,” he added.
Ryanair is operating 13 aircraft from Dublin during the current winter timetable and 16 or 17 in the summer. “It could be [aimed] more for the summer,” Mr Millar said, citing Dublin as the likely airport to be affected.
Ryanair has grounded 80 aircraft across its network this winter due to weak demand and high fuel costs.
It has been cutting its capacity out of Ireland steadily for the past three years and has criticised the Government for allowing airport charges to rise at Dublin airport, while also imposing a travel tax.
Ryanair’s share price closed up 1 per cent yesterday following the publication of its results.
Its third-quarter revenues rose by 13 per cent to €844 million in spite of a 2 per cent decline in passenger numbers to 16.7 million.
The revenue increase was driven by a 17 per cent rise in its average fare to €40.
Ryanair returned to the black, having posted a €10.3 million loss in the third quarter of its past financial year.
This return to profitability was aided by the fact that there was no repeat in the quarter just passed of the heavy snow of late 2010, which resulted in Ryanair having to cancel about 14,000 flights.
It came in spite of significant spike in fuel costs. Ryanair expects its fuel bill in the year to the end of March to rise by €350 million, with a similar increase pencilled in for next year.
“Clearly, we do have a headwind there and we have to pass that on in the form of a higher average fare,” Mr Millar said.
Ryanair said yesterday that it would seek shareholder approval in March to include American depository shares (ADRs) in its buy-back programmes.
The ADRs are listed on the Nasdaq market in the US, with one of them being the equivalent of five ordinary shares.
For the nine months to the end of December 2011, Ryanair’s adjusted after-tax profit rose by 26 per cent, to €558.4 million.
Its average fare rose by 15 per cent while its revenues increased by 21 per cent to €3.55 billion.
Ryanair’s fuel costs were up 31 per cent to €1.24 billion.
