Ryanair reported its first annual loss in 20 years as rising fuel, lower margins and a hefty write-down on its investment in Aer Lingus took their toll.
The figures bore all the marks of a recession - losses rose to €180.4 million (£155 million) for the full-year to March 31 compared with a €438.9 million profit the year before. Profits were hit by a 59 percent hike in fuel costs to €1.2 billion, whilst the value of its 29.8 percent stake in struggling Aer Lingus took a €222.5 million writedown.The falls come despite a 15 percent increase in passenger numbers and group revenues rising 8 percent to €2.94 million. Ancillary revenues, including baggage charges, grew by 23% to €598m.
Despite losses that placed Ryanair in the same bracket as many of its competitors, O’Leary was typically bullish today about the airline’s prospects for the year. He said Ryanair planned to at least double post-tax earnings to between €200m and €300m this year.
“In this recessionary environment we intend to continue to offer European consumers ... better value just like Aldi, Lidl, IKEA and McDonalds are doing in their respective industries,” O’Leary said.
“Ryanair will continue to lower fares to stimulate traffic growth, maintain high load factors and win more short-haul traffic from our high-fare competitors.”
Ryanair plans to grow passenger numbers to 67 million this year by cutting average fares by between 15 percent and 20 percent to as little as €32.
The group said that it had raised hedging against the price of fuel and that if oil prices remained at present levels its fuel bill for the year would be €450 million lower than last year.
Ryanair said that the combination of lower fuel costs and higher passenger numbers would help to lift it to a net profit, which excludes exceptional items, of between €200 million and €300 million this year.
Ryanair plans to enlarge its fleet from 188 to 202 in the summer, to 244 by next summer and to 303 by 2012.