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| Ryanair cuts profit forecast after fall in pound | Ryanair cuts profit forecast after fall in pound |
| (35 minutes later) | |
| Ryanair has reduced its forecast for full-year profits, blaming the drop in the pound following the Brexit vote. | Ryanair has reduced its forecast for full-year profits, blaming the drop in the pound following the Brexit vote. |
| The budget airline said net profit would be €1.3bn to €1.35bn (£1.17bn-£1.2bn), 5% below its earlier guidance. | The budget airline said net profit would be €1.3bn to €1.35bn (£1.17bn-£1.2bn), 5% below its earlier guidance. |
| Ryanair said the pound's fall would cut the revenues they receive from fares in the second half by 13% to 15%. | |
| Ryanair boss Michael O'Leary said while better cost control and stronger growth would help to offset the impact it was "prudent" to adjust its guidance. | Ryanair boss Michael O'Leary said while better cost control and stronger growth would help to offset the impact it was "prudent" to adjust its guidance. |
| He also cautioned that the airline's revised guidance was "heavily dependent" on both no further falls in the pound and no more cuts in the average revenues it received from fares. | |
| Earlier this month, rival Easyjet also warned the drop in the pound would cost it around £90m in the current financial year, more than double the £40m it estimated in July. | |
| Sterling has fallen around 18% against the dollar since the referendum. | |
| Prudence | |
| Aside from the hit from the falling pound, Ryanair said it was otherwise performing well. It expects to carry 119 million passengers this financial year, up 12% on the previous year. | |
| It also said its so-called load factor - basically how full its planes are - was expected to be 94%, slightly better than it originally forecast. | |
| "The recent sharp decline in sterling post Brexit will weaken second half yields by slightly more than we had originally expected. While higher load factors, stronger traffic growth and better cost control will help to ameliorate these weaker revenues, it is prudent now to adjust full year guidance which will rise by approx. 7% ([for the full year] rather than our original guidance of 12%," Mr O'Leary added. |