Volcanic ash cloud hits Ryanair profits

The budget airline Ryanair yesterday blamed the Icelandic volcanic ash cloud that grounded most of Europe's airlines earlier this year for a 24 per cent drop in net profits during the three months to the end of June.

The Dublin-based carrier said, however, that it was still confident of hitting full-year targets and stressed that adjusted full-year profits, taking account of the €50m (£42m) cost of cancelling 10,000 flights, would be up by 15 per cent. Ryanair said its adjusted first-quarter profits had grown by 1 per cent, helped by an 8 per cent increase in passenger traffic.

The chief executive, Michael O'Leary, who argued that aviation officials overreacted when deciding to close airspace during the ash cloud crisis, said: "Our [first quarter] profits were adversely impacted by the unnecessary closures of European airspace for 18 days in April and May.

"Despite these volcanic ash disruptions Ryanair continues to increase traffic, yields, and profits, while most of our competitors are cutting capacity and reporting losses."