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Ryanair has posted a 27 per cent fall in year-on-year after-tax net profits to €35 million (£26.37 million) during its third quarter.

The budget airline said the performance was "in line with previous guidance" and reflects the one-off €10 million (£7.53 million) contract termination penalty received from a hotel partner the year prior.

Excluding last year's penalty receipt and the sale of old aircraft, Ryanair said underlying profit declined ten per cent compared to 12 months ago, and warned that profits called fall a further 50 per cent in the next year.

"This net profit of €35 million (£26.37 million) is a credible performance in very adverse market conditions," said Ryanair chief executive Michael O'Leary.

"It reflects Ryanair's 21 per cent traffic growth, a four per cent decline in yields, flat unit costs and a strong ancillary sales performance," he said.

Mr O'Leary also blamed the "unjustified doubling of airport charges at the Stansted airport monopoly" and rising fuel costs for its profit shortfall.

He added that the company had sought to decrease costs by lowering capacity at Stansted to seven aircraft and by buying back €200 million (£150.68 million) worth of shares.

Reiterating his support for the campaign to break up the British Airport Authority (BAA) airport monopoly in London, Mr O'Leary remarked: "The London airports and consumers need a much tougher regulator than the misguided CAA [Civil Aviation Authority] which has repeatedly put the needs of BAA Stansted airport monopoly before the reasonable interests of passengers and airport users."

The Dublin-based air carrier has seen its share price tumble nearly 14 per cent to 3.12p in London this morning.