Ryanair has warned of an impending storm that will hammer the aviation industry as surging fuel costs meet suppressed passenger demand.
The budget carrier has posted profit growth of at least 25 per cent every year since 2009, but yesterday admitted its profit will fall by up to a fifth in the coming year.
"We expect recession, austerity, currency concerns, and lower fares at new and growing bases in Hungary, Poland, provincial UK and Spain to make it difficult to repeat this year's results," the chief executive Michael O'Leary said. "We expect that any increase in fares will only partially offset higher fuel costs."
Although the budget airline beat City forecasts to post a record annual profit, up 25 per cent to €503m (£406m) for the year to April, its shares, which hit €4.49 at the start of April, fell 1 per cent to €4.04 yesterday.
Ryanair said that higher oil prices next winter mean it will ground up to 80 aircraft, as it did for the first time last year, "rather than suffer losses flying at very low winter yields".
Mr O'Leary added: "The problem for us is that while the summer looks good with plenty of bookings, plenty of people switching to Ryanair to go on their holidays, next winter is much more difficult.
"We have no visibility, we have no bookings in the system yet and I think we're right to be cautious at this point in time. Clearly there's a lot of financial uncertainty, clearly there's a lot of worry about currency, higher oil prices, austerity. But people will still keep flying."
But he condemned the Government's lack of decision on expansion at Heathrow airport, plus its decision to raise air passenger duty, which Mr O'Leary claimed had cut traffic by 6 per cent since 2007.Reuse content