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IRELAND. Low-cost carrier Ryanair made a loss of €35 million in the third quarter of its financial year, blaming lower fares and the weakness of the Pound against the Euro. The loss came despite strong growth in ancillary revenues.
In the three months to the end of December, the company’s total revenues were down marginally year-on-year, from €969 million to €964 million. Last year it made a profit of €18.1 million during the same period. Passenger numbers were up +5.8% to 18.3 million.
Ryanair CEO Michael O’Leary said the loss was “entirely due to a -9% fall in [average] fares and weaker sterling”.
“We responded to this weaker pricing environment last September with seat promotions and lower fares which stimulated traffic across all markets resulting in +6% growth in Q3, and a +1% rise in monthly load factors,” he added.
The airline’s ancillary revenues during the quarter grew by +13.2% to €249.2 million, outpacing traffic growth. Ryanair said this was due to a combination of an improved product mix, the roll out of reserved seating across the network and higher administration and credit card fees.
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In recent months, Ryanair has made a number of major customer service changes, with O’Leary admitting at the company’s AGM in September that it needed to “eliminate things that unnecessarily p*** people off”.
Ryanair now lets passengers take a small, second carry-on bag free of charge and has reinstated allocated seating on all flights. The airline believes that it will more than compensate for revenue lost from cutting airport and bag fees through sales of reserved and allocated seats.
