Ireland's low-cost airline Ryanair reported third-quarter losses of 119 million euros due to rising fuel costs and reduced fares. However, the carrier said a recent drop in fuel prices would help it post higher-than-expected full-year profits.
AFP - Irish low-cost airline Ryanair said on Monday it had made a loss of almost 119 million euros (151 million dollars) during its third quarter as fuel costs soared and it reduced fares.
The airline however upgraded its full-year profit forecast to between 50 and 80 million euros from a previous estimate of break-even as fuel costs have fallen sharply since the end of 2008 on reduced demand for energy.
Ryanair said its net loss of 118.8 million euros during the three months to the end of December compared with net profit of 47 million euros during its third quarter of 2007.
"Thanks to lower oil costs and continuing reductions in non-oil operating costs, we expect the fourth quarter loss will be smaller than previously anticipated, so we are upgrading our full year 2008/09 guidance from break-even to a net profit after tax in a range of 50 million to 80 million euros," Ryanair said in its earnings statement.
It added that it would benefit from a global economic slowdown.
"We are poised for substantial traffic and profit growth in the coming year as the recession forces millions of passengers to focus on price," Ryanair said.
The no-frills carrier added that it was unlikely to make a renewed bid for Aer Lingus after last week withdrawing its one-billion-dollar (748-million-euro) takeover offer for the rival Irish airline.
The Irish government, which owns a 25 percent stake in Aer Lingus, rejected the bid in January, arguing that it greatly undervalued the carrier.
"Whilst we regret that the government's decision means that we cannot now deliver on our promises to reduce Aer Lingus's short-haul fares, double its short-haul fleet and create 1,000 new jobs, this decision clears the way for Ryanair to continue to focus on our own growth and expansion, reducing our costs and returning to substantial profitability over the coming year," Ryanair added on Monday.
"It is doubtful that Ryanair will waste any further management time or resources making another offer for Aer Lingus, as its scale and losses will continue to render it increasingly irrelevant in Europe's airline landscape."
Ryanair's offer was worth only half the 1.48 billion euros the low-budget carrier had offered for Aer Lingus in an unsuccessful takeover attempt in October 2006.
Date created : 2009-02-02