Bon voyage? Ryanair to “pivot” growth away from UK and towards EU following Brexit vote
Ryanair has confirmed it is shifting its strategy away from the UK in a trading statement this morning, which also revealed a modest boost to profits and revenue.
The figures
The company announced profits before tax for the three months to June of €286.5m (£239m), up three per cent on last year's €277.8m. Meanwhile, revenue also grew to €1.7bn, up two per cent on the prior year.
Customers increased 11 per cent, going from 28m to 31.2m.
Average fares, meanwhile, fell 10 per cent to €39.92.
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Why it's important
Everybody has been taking a close look at results recently to see when and where Brexit will crop up. Today's statement from Ryanair described the vote result as both "a surprise and a disappointment", which is hardly astonishing, given the company actively campaigned for Remain.
While the statement suggested significant period of uncertainty on the horizon and added Ryanair cannot predict the full impact the vote will have on its business at this point in time, it revealed it would "pivot" its growth away from UK airports and focus more on the EU over the next two years.
In particular, the company stated it will cut capacity and frequency on many of its London Stansted routes, although no route will close completely, and its three UK domestic routes may be affected depending on what sort of access the UK can negotiate for the free market.
Plus, while the company maintained its current guidance today, it warned of "significant risks to the downside during the remainder of the year" thanks to the vote result.
Other than the referendum, airline companies have not had the easiest of times so far this year, with industrial action and a tragic string of terrorist incidences both taking their toll.
What Ryanair said
"The absence of Easter in quarter one and on-going market volatility arising from terrorist events, and repeated air traffic control strikes (particularly in France) weakened fares on close-in bookings and caused almost 1,000 flight cancellations," said Ryanair's chief executive Michael O'Leary.
In short
A pretty positive set of figures for the most recent quarter but signs of stormier skies ahead following the Brexit vote.