Ryanair slashes profits forecast by five per cent due to tumbling value of Pound

RYANAIR has cut its profits forecast by five per cent because of the weak Pound.

And it is braced for an even bigger hit if the currency slumps further.

The Dublin-based budget airline has soared above rivals in the past year but not even outspoken boss Michael O’Leary is immune from the wider economy.

It blamed the 18 per cent drop in the value of sterling since the Brexit vote for its warning.

The fall meant fares in the six months to late September were down ten per cent, in a major boost for passengers.

In the second half of its financial year, they are set to drop by as much as 15 per cent.

But its planes are fuller than ever, with an average of 94 per cent of seats booked.

Chief exec Mr O’Leary said: “While higher load factors, stronger traffic growth and better cost control will help to ameliorate these weaker revenues, it is prudent now to adjust full-year guidance.”

Full-year earnings will now be £1.17billion to £1.22billion, down from the previous guidance of £1.24billion to £1.28 billion.

But the airline warned forecasts could be lowered again if the Pound and fares fall further.

ETX CAPITAL analyst Neil Wilson said: “Ryanair’s problem is a microcosm of Ireland’s post-Brexit conundrum — huge exposure to the UK market and sterling, but earnings booked in euros.”

It comes after rival EASYJET revealed the drop in the Pound would cost it about £90 million in the current financial year.