Ryanair on Monday warned that average fares would be lower than expected during its key summer period due to high competition, unusually hot weather in Northern Europe and uncertainty caused by a series of strikes.
Weaker fares combined with higher staff and fuel costs caused profit to fall by 20 percent compared with last year in the three months to the end of June, the first quarter of its financial year, it said.
But the profit of 319 million euros ($374.4 million) for the quarter was in line with earlier guidance and slightly ahead of a forecast of 305 million euros, according to a company poll of analysts.
"While Q1 fares were marginally stronger than previously expected, the recent weaker fare environment and the expected impact of crew strikes on forward pricing mean that Q2 fares will only rise by approx. 1 percent," Chief Executive Michael O'Leary said in a statement.
The weaker environment was "due to the World Cup, the Northern European heat wave and customer uncertainty about pilot strikes," O'Leary said. Ryanair released the results ahead of its worst-ever week for strike action, with over 300 of its daily 2,400 flights cancelled on Thursday and Friday due to action by cabin crew in Spain, Portugal, Italy and Belgium.
Ryanair, which flies in 37 countries and carried 130 million passengers last year, averted widespread strikes before Christmas by deciding to recognize trade unions for the first time in its 32-year history. But it has since struggled to reach agreement on terms with several of them.