Budget airline Ryanair today said a surge in fuel prices was behind a 29 per cent drop in first-quarter profits.
The group also said it was braced for a difficult winter as austerity measures and the eurozone crisis hit demand.
The Dublin-based carrier, which operates more than 1,500 flights a day across 28 countries, is expecting traffic growth of 1 per cent between September and March, down from 7 per cent this summer following winter capacity cuts.
The outlook came as the airline, which expects to carry 79 million passengers this year, said revenues for the three months to 30 June rose 11 per cent to €1.3 billion euros (£1bn) as 6 per cent traffic growth combined with a 4 per cent rise in average fares.
However, chief executive Michael O’Leary said a 27 per cent surge in fuel costs was behind a 29 per cent slide in underlying pre-tax profits to €99m in the period.
Ryanair reported a 15 per cent rise in ancillary sales – which includes baggage and administration fees, as well as in-flight food and drink – to €286m. Ancillary sales now account for 22 per cent of all revenues.
The carrier, which has a fleet of 294 planes, said growth in the first quarter was dampened by the EU-wide recession, austerity measures and also heavy discounting at new bases including Cyprus, Denmark and Hungary.
Ryanair mounted a fresh bid to seize control of rival Aer Lingus last month by tabling an offer valuing the company at around €694m.
The airline, which already owns a 29.8 per cent stake in Aer Lingus, needs approval from EU regulators for the deal to go ahead. A previous takeover attempt in 2006 was rejected.
Ryanair today said it would be “inappropriate” to comment while it was engaging with regulators.