Volcano Affects Ryanair Profit

DUBLIN, IRELAND (GaeaTimes.com)- The Irish budget airline Ryanair has reported a loss of 24 percent in its report for the first quarter. The main reasons for this loss are a hike in crude fuel price and the enormous blow the aviation sector received during the Icelandic volcano eruption. It is quite well known now that the Icelandic volcano that erupted earlier this year covered a large section of sky used by the European airlines with ash and particles which grounded flights at all major UK and US airports for several days. The airlines including Ryanair had to cancel many flights resulting in unexpected loss of revenue.

Ryanair said that the net earning took a nosedive to 93.7 million euros in last quarter compared to 123 million euros in the same fiscal last year. However the aviation sector analysts expected a steeper fall in the revenue. The airline based in Dublin reported that it lost near about 50 million for the Icelandic volcano. Michael O’Leary the Ryanair chief executive said that the closure of European airspace that lasted for more than two weeks was the chief reason for the deficit in revenue. As many as 400 flights of the airlines had to be cancelled. The airline lost more than 1.5 million fliers in that period as the CEO said.

The CEO of Ryanair lambasted the European Union consumer law which makes the airlines and not the insurance companies bear the brunt of customer accommodation in cases of flight cancellation. Though Ryanair posted loss for the quarter owing to volcanic ash problem it aims to boost the margin with a number of additional charges.