Ryanair reported on Monday a $22.88 million (€20 million) loss in the third quarter on weaker fares, which it expects to continue throughout the year.
Weak fares had led the company two weeks ago to cut its full-year profit forecast for the second time in three months.
Ryanair expects its profit for the year to end-March to fall by up to 31 percent due to a mix of summer strikes, higher oil prices and short-haul overcapacity in Europe, reiterating on Monday that it could not rule out a further downgrade.
Europe’s largest low-cost carrier, which makes most of its profit in the summer, said it expected the continued short-haul overcapacity to lead to a weaker – not stronger – fare environment.
“We do not share the recent optimistic outlook of some competitors that Summer 2019 airfares will rise,” the Irish airline said in its results statement.
“In the absence of further EU airline failures, and because of the recent fall in oil prices (which allows loss-making unhedged competitors to survive longer), we expect excess short haul capacity to continue through 2019.”
Ryanair said in its profit warning last month that its fares in the second half of its financial year were set to fall by 7 percent, rather than the 2 percent previously flagged.
In the third quarter, strong traffic growth of 8 percent was offset by a 6 percent decline in average fares while a 26 percent increase in ancillary revenues to €557 million was offset by higher fuel and staff costs.
The airline also said that it will move to a group structure not dissimilar to that of IAG over the next 12 months, with four airline subsidiaries — Ryanair DAC, Laudamotion, Ryanair Sun and Ryanair UK — each led by their own CEOs and management teams.
Michael O’Leary will become Group CEO and has agreed a new 5-year contract, it added.