Ryanair posts record annual profit, pessimistic on year ahead

Ryanair posted a record annual profit Monday as it brushed off a rostering mess-up that forced it to cancel flights and sparked a dispute with pilots, but warned profits would fall back in the coming year due to higher costs and no fare growth. Ryanair cancelled 20,000 flights in September as an emergency measure to free up enough standby pilots to ensure the smooth operation of its fleet of 400 planes for the remainder of the year. The cancellations sparked a wave of bad publicity and forced Ryanair to cut its growth plans for the first time in years. It has insisted this is a temporary measure and its long-term growth target remains intact. The carrier booked a record E1.45b profit after tax in its financial year to March 31, up 10% year-on-year and slightly ahead of an average forecast of E1.44b in a company poll of analysts. However, it said it expected to make a profit after tax of between E1.25b and E1.35b for the coming financial year, lower than the E1.37b expected on average by the analysts forecast. While Ryanair expects to grow traffic by 7% to 139m passengers, up on the 138m last forecast, unit costs are expected to rise by 9% due to higher staff and oil prices with revenue from ancillary products unlikely to grow fast enough to fully offset this and broadly flat fares. “Our outlook for FY19 is on the pessimistic side of cautious,” CE Michael O’Leary said. “Forward bookings are strong but pricing remains soft. While still too early to accurately forecast close-in summer bookings or H2 fares, we are cautiously guiding broadly flat average fares for FY19.”<br/>