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Ryanair maintains profit guidance but says fares to remain weak

Ian Waldie | Getty Images News | Getty Images

Ryanair expects to meet its annual profit guidance despite falls in average winter fares that could exceed 15 percent, it said on Monday, warning of a challenging year ahead for European airlines.

Europe's short-haul carriers have struggled with plunging air fares in recent months with low-cost rivals Wizz and easyJet both trimming their annual profit forecasts in recent weeks.

Ryanair, Europe's largest carrier by passenger numbers, in October cut its forecast for profit after tax for the year to March 31 by 5 percent, to a range of 1.3 billion to 1.35 billion euros. On Monday it said it was maintaining that guidance.

The average forecast of analysts covering the company was 1.329 billion euros, according to a company poll ahead of Monday's release.

The Irish airline on Monday reported an 8 percent fall in profits compared to last year in its third quarter, which ended on Dec. 31, as average fares fell by 17 percent.

"Pricing will continue to be challenging and we will respond to these adverse market conditions with strong traffic growth and lower unit costs," chief executive Michael O'Leary said in a statement.