Ryanair posts €136.5m profit for first quarter

Ryanair, which last week announced it was cutting its winter services out of Stansted by 40%, also grew “ancillary” revenues - such as extra fees for checked-in baggage and credit cards – 13% to €165.3m.

Unit costs fell by 26% due to lower fuel prices (5% drop excluding fuel) and reductions in staff, airport and handling costs, the company said.

Its fuel costs were 42% lower than last year, when the oil price bubble hit airlines hard.

Ryanair has now taken out hedging – effectively insurance – to fix fuel prices for the year ahead, with aims to see annual savings of €460m.

“Thanks to a 13% reduction in average fares we grew traffic by 11%, which was a robust performance in a deep recession, when many of our competitors were cutting flights, losing traffic and reporting increased losses," said CEO Michael O'Leary.

"Our successful roll out of new routes and bases demonstrates the fundamental strength of Ryanair’s lowest fares model which even during deep recessions continues to deliver growth."

The Ryanair boss said the outlook for the remainder of the fiscal year remained "cautious".

"Traffic growth is strong but at much weaker yields due to the recession and the impact of tourist tax in Ireland and the UK," O'Leary said.

The company said full-year profits would be impacted by aggressive action to slash fares to attract cash-strapped fliers.

Annual net profits were now expected at the lower end of market forecasts for between €200m and €300m.

The company reiterated its opposition to the €10 tourism levy imposed by the Government, saying it expected traffic at the main Irish airports to fall by 20% this winter as a result.

"We again call on the Irish and British governments to follow the more sensible leads of the Belgian, Dutch, Greek and Spanish governments, all of whom have recently scrapped tourist taxes and have reduced airport charges, in some cases to zero, in order to stimulate tourism," O'Leary said.