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**Ryanair Reports 18% Decline in First-Half Profit to €1.79 Billion: A Closer Look at the Factors Behind the Drop**
*October 2023* – Ryanair, Europe’s largest low-cost airline, has reported an 18% decline in its first-half profit for the fiscal year, amounting to €1.79 billion. This marks a significant drop from the €2.18 billion profit recorded during the same period last year. The airline, known for its budget-friendly fares and extensive European network, has attributed the decline to a combination of factors, including rising fuel costs, increased competition, and operational challenges.
### **Key Factors Behind the Decline**
1. **Rising Fuel Costs**
One of the primary reasons for the profit decline is the sharp increase in fuel prices. The global aviation industry has been grappling with volatile oil prices, and Ryanair is no exception. The airline’s fuel bill surged by over 30% compared to the previous year, driven by higher crude oil prices and the weakening of the euro against the US dollar, the currency in which oil is traded. While Ryanair has historically been adept at hedging fuel costs, the recent spike in prices has outpaced its hedging strategies, leading to higher operational expenses.
2. **Increased Competition**
The European aviation market has become increasingly competitive, with both legacy carriers and low-cost rivals vying for market share. Airlines such as EasyJet, Wizz Air, and Vueling have been expanding their routes and offering competitive fares, putting pressure on Ryanair’s pricing power. Additionally, the resurgence of long-haul low-cost carriers has intensified competition on certain routes, particularly in the transatlantic market. This has forced Ryanair to lower ticket prices on some routes to maintain its market position, which has, in turn, impacted its profit margins.
3. **Operational Challenges**
Ryanair has also faced a series of operational challenges in recent months, including air traffic control (ATC) strikes, airport staffing shortages, and weather-related disruptions. These issues have led to flight cancellations and delays, which have not only inconvenienced passengers but also increased the airline’s compensation and rebooking costs. The airline has been particularly vocal about the impact of ATC strikes in France, which have caused widespread disruption to flights across Europe.
4. **Post-Pandemic Recovery and Capacity Constraints**
While the global aviation industry has been recovering from the COVID-
