Ryanair shares opened sharply lower this morning as the company warned pricing would come under pressure this year in the face of heightened competition.
Profits rose 55% compared with the same period last year, to €397m, though the results were distorted to the upside by the timing of Easter in 2017.
The budget airline left its full-year guidance unchanged, citing other headwinds such as adverse currency impact, lower revenue from passenger bags and terrorism. There is also the uncertainty of Brexit.
Shares were down by as much as 5.5% in early trading on the London stock exchange.
Lower fuel prices appeared to be both a blessing and a curse for Ryanair, with the airline warning that the trend was leading to increased competition from carriers based in the peripheral eurozone, North Africa and the Middle East.
Ryanair warned it may need to cut late summer fares by up to 9%, while speculating that some short-haul airlines may not survive the pricing pressures.
Chief executive Michael O´Leary repeated his warning of a possible disruption to flights between the UK and Europe when the UK leaves the EU in 2019.
“If we do not have certainty about the legal basis for the operation of flights between the UK and the EU by autumn 2018, we may be forced to cancel flights and move some, or all, of our UK based aircraft to Continental Europe from April ’19 onwards,” said O’Leary.
Ryanair revealed it had submitted a non-binding bid for Italy´s Alitalia, which put itself under administration in May.
The Irish airline is thought to be one of ten airlines to have filed bids for the ailing airliner.
Italy´s il Messaggero newspaper reported that EasyJet and Deutsche Lufthansa were among the other carriers to have submitted bid proposals.