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Ryanair reports surprise €10m loss after snow cancellations

Higher fuel costs, industrial action and snow cancellations see Ryanair lose €10m in the three months to December 31.

Image: Claude Paris/AP

LOW-FARES airline Ryanair has reported a surprise €10m loss for the final quarter of 2010, despite seeing an increase in both passenger numbers and turnover.

The Dublin-based airline saw turnover reach €746m, an increase of 22% on the same quarter of last year, and reported an increased passenger load of 17m (up by one million), while the average fare and in-flight spend paid by passengers both increased too.

But FT.com reports that the combination of increased fuel costs and flight cancellations – led by the industrial action of air traffic controllers on the continent, and the unusually snowy weather in December – saw the airline report a €10.3m loss.

Although that loss was slightly down on a similar €10.9m loss reported by the airline in the same final quarter of 2009, chief executive Michael O’Leary remarked that the results were “disappointing”.

He added that the airline had been forced to cancel a total of 3,000 flights in the quarter, after snowfall closed runways in Dublin, Stansted, Gatwick, Edinburgh and many of the airline’s other major hubs.

The Irish Times continues that O’Leary criticised the retention of the Irish government’s €3 travel tax, and European Union regulations which he said unfairly discriminated against airlines in cases of extreme weather.

When flights were cancelled, airports saw business at restaurants and the like boosted – but instead of being able to share in that trade, airlines were being forced to subsidise it by the EU, O’Leary argued.

Fuel costs, meanwhile, rose by 37% – though the airline had hedged almost all of its fuel requirements for the next quarter at $750 per tonne of crude oil, compared to current market prices of $890 and rising.

RTÉ reports, however, that the airline has maintained its full year profit guidance of between €380m and €400m.

Shares in the airline on the Dublin Stock Exchange rose this morning, however, up 6c to €3.68 per share.

About the author:

Gavan Reilly

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