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Ryanair to take legal action against Stansted on ‘overcharges’
Ryanair has announced it will shortly be launching legal action against BAA Stansted, seeking a recovery of “substantial overchargesâ€.
It claims it has suffered at the BAA Stansted monopoly’s hands in recent years, along with other Stansted airlines.
Announcing its first quarter results today, it said the UK Governmemt should force the early sale of Stansted and one of the Scottish airports to allow competition between airports.
“The latest UK Competition Commission’s confirmation (of its original 2008 recommendation), that the BAA airport monopoly should be forced to sell Stansted and at least one Scottish airport will, we hope, finally end the BAA ‘s policy of using legal manoeuvres to delay this sale,†it said.
“These delaying tactics have not stopped the BAA at Stansted overcharging airlines, generating excess monopoly profits, while losing more routes and traffic.â€
Ryanair announced a slight 1% increase in net profit to €139 million for the first quarter to June 30.
Revenues grew by 29% to €1,155 million as traffic increased 18% and average fares rose 11%.
Unit costs rose by 14% due to a 49% increase in fuel costs.
Excluding fuel, sector length adjusted unit costs fell by 1%.
CEO Michael O’Leary said traffic growth was flattered by the unnecessary airspace closures in April and May 2010 following the Icelandic volcanic eruptions.
Ancillary sales grew 22% to €248 million and amounted to 21% of total revenues.
Ryanair said it has recently started trials of reserved seating for 21 extra legroom seats on selected routes for a fee of €10 per seat.
“If successful we will roll out reserved seating across more of our network this winter,†it said.
Ryanair said its outlook for the remainder of the year remains unchanged.
It expects full-year traffic to grow by 4% comprising 10% growth in the first half, and then fall by around 4% in the second half due to already announced winter capacity cuts.
Average fares for the year are expected to rise 12% due to the “better mix of new routes and bases, our winter capacity cuts, higher competitor fares and fuel surchargesâ€.
“With very limited visibility on second half bookings or yields at this time, our full year guidance remains unchanged as we expect profit after tax for the full year to be similar to the 2011 result of €400 million.â€
by Bev Fearis
Bev
Editor in chief Bev Fearis has been a travel journalist for 25 years. She started her career at Travel Weekly, where she became deputy news editor, before joining Business Traveller as deputy editor and launching the magazine’s website. She has also written travel features, news and expert comment for the Guardian, Observer, Times, Telegraph, Boundless and other consumer titles and was named one of the top 50 UK travel journalists by the Press Gazette.
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