RYAAY Ryanair Holdings PLC

LONDON—Britain's decision to leave the European Union will weaken airfares and is causing Ryanair Holdings PLC, Europe's largest carrier by passengers, to consider shifting growth away from the U.K., the airline's chief executive said Monday.

"We are taking another 50 aircraft next year. Would we place any of those in the U.K.? It is highly unlikely," Michael O'Leary said in an interview. "We will pivot all of our growth into the European Union."

Shares in airlines have been among the hardest hit by the U.K. vote last week amid concern a plummeting British currency and slowdown in economic growth will impact demand. British Airways parent International Consolidated Airlines Group SA issued a profit warning Friday in part linked to the outcome of the referendum, and British budget carrier easyJet PLC Monday said earnings would be hit. Shares in easyJet are down about 24% in afternoon London trading.

Mr. O'Leary said "there clearly is going to be a hit to U.K. GDP and to European GDP. There is three to four months of considerable uncertainty. The pound has fallen through the floor. It has all the feel and hallmark of another 9/11." Ryanair's response will be to discount seats, he said, to fill planes.

Ryanair's stock also has been dragged down sharply by the selloff in airline shares. Mr. O'Leary said the company used the Friday market slump to buy back its own stock. The airline purchased about €150 million ($165 million) worth of its own shares, Mr. O'Leary said, and would have bought more if it hadn't reached the upper limit of its authorized annual total.

Ryanair isn't wavering from its growth plans in terms of aircraft being introduced or passenger figures, the chief executive said. The airline, which carried 116 million passengers last year, expects to reach 180 million passengers by 2024. More of that growth now will likely be generated in the EU rather than U.K., he said.

Mr. O'Leary said bookings haven't been dented by the uncertainty of the referendum or the fall in the British currency. The airline early Friday, with the outcome of the vote still uncertain, launched a previously planned seat sale celebrating the U.K. remaining in the EU. "We had a surge of bookings," Mr. O'Leary said, adding that having called the outcome of the vote wrong only helped spread the word about the sale.

Despite the sharp fall in sterling, Mr. O'Leary expects to see a limited impact on near-term bookings from the U.K. to other destinations that are now relatively more expensive. "Bookings are already pretty strong through June, July, August," he said. The airline's sales made in the British currency will now translate into fewer euros, though, impacting earnings, he said.

Airlines also face regulatory uncertainty following the U.K. vote. British airlines and those serving the U.K. have operated under the EU's single aviation market, which allows any airline within the region to fly to any city in the bloc. There has been no decision on how future traffic rights would be governed, though British carriers have urged the U.K. to remain part of the European aviation area.

Mr. O'Leary said he expected the U.K. to eventually negotiate some sort of access to the EU market. If not, he said, Ryanair could seek a U.K. license to maintain traffic rights, even though that could entail higher costs. One of the airline's largest bases is London Stansted airport.

Write to Robert Wall at robert.wall@wsj.com

(END) Dow Jones Newswires

June 27, 2016 12:35 ET (16:35 GMT)

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