For the 2008/2009 financial year, the airline carried 58.5m passengers, up 155 on the previous year with revenue growing 8% YoY to €2.942bn. The adjusted profit after tax dropped 78% to €105m, largely due to the airline's fuel bill jumping €466m (+59%) due to a poor fuel hedging strategy.
The airline did bite the bullet on it's Aer Lingus investment, writing down €222.5m in impairment charges for the fall in the Aer Lingus share price and it also took an accelerated depreciation charge on aircraft worth almost €51.6m which allows aircraft to be written down to their disposal cost so that no gain or loss shows on the books. Both of these charges produced a loss for the year amounting to €169m, the first time the airline has lost money in 20 years.
Average fares fell 8% to €40 during the year with ancillary revenue - lottery tickets to sandwiches growing 23% YoY to €598m. The airline's chief executive Michael O'Leary said that the average fare could drop as low as €32 during 2009 in his comments which forecast a profit of between €200m and €300m for the current year. Some analysts believe however that profit could be closer to €400m should the decline in yield be closer to 15% than the 20% forecast by the airline. A case of management under predicting a better than expected performance.
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