Ryanair lifts profits but takes £22 million hit from flight cancellation fiasco

Ryanair Profit Gains as Strong Prices Offset Pilot-Crisis Impact

Ryanair says it's still on track for record profits despite flight cancellations

The low-priced carrier has come under fire after cancelling around 20,000 flights in the autumn due to an error over pilot holiday rosters.

However, leading airline in Europe and Spain remains concerned about continued uncertainty about terms of UK's departure from EU (Brexit) in March 2019, and warns that re is "a worrying risk of a serious disruption of flights between EU and The United Kingdom in April 2019 "unless both parties reach a bilateral agreement by September 2018".

Half-year profits up 11%, revenue up 7%. Reports later emerged suggesting Ryanair was struggling to attract and retain pilots.

Helping to drive the bottom line growth was a sharp increase in passenger numbers which jumped 11% to 72.1mln (H1 2016: 64.8mln).

The budget airline said refunds to customers cost it €25 million (£22 million) in the six months to the end of September.

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"We will now move from being "competitive" to offering materially higher (over 20 percent) pay with better career prospects, superior rosters, and much better job security than Norwegian, among others, can offer", said the airline.

Neil Sorahan, chief financial officer of Ryanair, told CNBC Tuesday that the results showed a "very solid performance" and underpinned the strength of its model. Many in the City had thought the recent issues would hit profitability, but Ryanair said it could "see no reason" to change its profit after tax guidance of between €1.40bn and €1.45bn.

Partly it's compensation costs but it's also because Ryanair plans to pay pilots more.

- Irish airline Ryanair on October 31 confirmed its full-year profit guidance of between 1.4 billion and 1.45 billion euros despite a pilot rostering failure in September that led to the cancellation of around 20,000 flights.

Ryanair says it expects customer growth to slow to 4% in the second half of the year as a result of cancelled flights and says costs in the second half of the year will rise by 2% as a result of the measures to address the cancellation crisis. The firm has had to hire 900 extra pilots so far this year and admitted that in September it entered a "series of poor planning decisions" that led to pilot-shortages.

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