Ryanair to ground 10% of fleet

The carrier - which unveiled a 17% rise in pre-tax profits to 528 million euro (£419m) in the year to March 31 - said it would be more profitable to keep 20 aircraft on the ground at Stansted and Dublin than put them in the air.

Chief executive Michael O'Leary blamed the "unjustified" doubling in landing and handling charges levied by Stansted operator BAA and higher charges at Dublin Airport.

He added that the effect of oil price rises - which have nearly doubled to the 130 US dollar a barrel mark over the past year - had been mitigated through bulk buying at cheaper prices.

But Mr O'Leary warned that this year's prospects depended entirely on oil costs - and that Ryanair would break even if prices remained at the 130 US dollar mark for the rest of the year.

Ryanair carried 50.9 million passengers during the past year, 20% more than the previous year.

Mr O'Leary said average fares for the coming year were likely to rise by 5%. During the year to March 31 the airline's average fares, including baggage charges, came in at 44 euro (£35) - down 1% on the year before. Total revenues were 21% up to 2.7 billion euro (£2.1bn).

He blamed higher airport charges on the "abysmal" failure of industry regulators but said his overriding concern was the "irrational" price of oil. He pledged to absorb higher costs even if they led to a short term fall in profits.

Mr O'Leary added: "The airlines who will survive this period of higher oil prices and industry downturn are those with new cheaper fuel efficient aircraft, lower costs, substantial cash balances, low net debt and management who are ready to exploit downturns to drive costs lower and increase efficiency.

"No airline is better placed in Europe than Ryanair to trade through this downturn."