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Brexit clouds in Ryanair's blue skies?

Monday, July 25, 2016 - 01:42

Record profits are on the horizon, according to budget carrier Ryanair. But so too could be Brexit storm clouds which, says the airline, could yet mean it will have to revise down its outlook. Hayley Platt reports.

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The skies are blue now for Ryanair but it sees turbulence ahead. Europe's biggest low cost carrier told investors it's on track for its highest-ever profit this year despite a number of external shocks. (SOUNDBITE) (English) RYANAIR, CHIEF FINANCIAL OFFICER, NEIL SORAHAN, SAYING: "We're projecting a 12 percent increase in guidance to a range of between 1.375 billion - 1.425 billion (euros). However, there are considerable risks to the downside there, particularly post-Brexit and the current uncertainty in the markets around terrorism and air traffic control strikes." A 10 percent fall in the value of sterling since the Brexit vote hasn't helped. Stansted is Ryanair's largest hub. Forty million of its 100 millon-plus passengers fly in and out of Britain from there every year. Ryanair says it would offset the impact by moving some capacity away from Britain - starting this winter. But it also says the Brexit uncertainty could last years. (SOUNDBITE) (English) RYANAIR, CHIEF FINANCIAL OFFICER, NEIL SORAHAN, SAYING: "If the decision is taken to stay within Open Skies and the European Common Aviation Area then all airlines will continue to fly as they do in through Europe. However, if it's a full exit that may have an impact on our domestic UK routes. " The deadly attack in Nice and the attempted coup in Turkey has hit the industry hard. Ryanair says it's well placed to weather the storm. (SOUNDBITE) (English) RYANAIR, CHIEF FINANCIAL OFFICER, NEIL SORAHAN, SAYING: "In the days following the attack you do see a slowdown in demand. Which we typically stimulate with lower fares and hit the passenger targets as a result. That's good news for passengers. But it could be met with competition from other budget airlines - leading to a possible price war. ///