Ryanair has said its earnings will be flat this year due to high fuel costs and a lack of growth in capacity.
The boss of Europe’s largest low-cost airline, Michael O’Leary, said longer, more lucrative routes and growth in France and Germany will help drive up fares, but that will be offset by higher costs and weakness in southern Europe and the Irish domestic market.
Ryanair’s net profit surged 26 percent in the fiscal year just ended to 401 million euros, better than forecast.
The Irish airline, which operates more than 1,500 flights a day, said it expected traffic growth to slow to four percent in 2012 from eight percent last year and that increases in average fares would be eaten up by higher fuel costs.
“I see a lot of upside in us not growing for the next year or two, at least not growing in the top line,” O’Leary told a conference call with analysts. Ryanair will instead focus on cutting costs and increasing yields, he said.
Asked about the latest Icelandic volcano ash cloud O’Leary said he hoped that would be less problematic than last year’s when European airspace was closed for six days and transatlantic flights hit.
“I think the regulators are a bit more sensible than they were last year,” O’Leary said. “I hope there will be no airspace closures — there shouldn’t be, certainly not over any countries where we are flying.”