Ryanair, Europe's biggest budget airline, warned high fuel costs and a worsening economic outlook meant profit would slip by up to 20 percent in the coming year, the first fall in four years.
The Dublin-based airline, which posted a record annual profit on Monday and has posted profit growth of at least 25 percent every year since 2009, confirmed it would pay out EUR€483 million (USD$614.5 million) to shareholders in just its second dividend payout since floating in 1997.
Net profit reached EUR€503 million for the year to March, up 25 percent on the previous year.
But it warned worsening economic conditions in Europe and stubbornly high fuel costs would cut its profit to between EUR€400 million and EUR€440 million in 2013, making it the first year since 2009 that profit has fallen.
"Recession, austerity, currency concerns and lower fares at new and growing bases... will make it difficult to repeat this year's record results," chief executive Michael O'Leary said in a statement.
"Any increase in fares will only partially offset higher fuel costs."
The airline, which has a lower cost base than many of its competitors, raised fares 16 percent over the year to help offset a fuel bill that was 30 percent higher.
But it warned it would be unable to pass on an additional EUR€320 million euro increase in fuel costs expected in the coming year.
"There's a poor environment, it's the fourth year of this, and repeating (fare growth of) 16 percent is not going to happen," said Chief Financial Officer Howard Millar. He added fares would likely rise by closer to 3 percent.
"Ryanair is not as worried about the fallout of Greece's current political crisis as the fact that the euro zone is suffering its fourth year of poor economic performance," Millar said.
"Greece is very small for us... we would be more concerned about places like Spain, its high unemployment and plans to raise taxes," he said.
Traffic will grow by 5 percent for the second year in a row to reach 79 million in the year to March 2013, he said.
British peer easyJet this month said it expected second-half revenue to rise as business passengers help it to overcome higher fares.
Higher cost rivals Air France-KLM and Lufthansa this month reported results battered by the global economic slowdown and high jet fuel prices.
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