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European budget carrier Ryanair has posted record full-year profits and passenger figures, and expects both to hit new highs this summer amid rapid growth and declining fares.
Monday’s results for the year ending March 31 showed the Dublin-based airline strengthening on every front. Net profit before exceptional gains rose 43 percent to 1.24 billion euros ($1.4 billion) and the percentage of seats sold rose 5 points to 93 percent. Total sales rose 16 percent to 6.54 billion euros and the overall number of passengers for the year rose 18 percent to 106.4 million.
Chief Executive Michael O’Leary says Ryanair expects average fares to fall around 6 percent this summer and even more in winter amid increased competition and well-hedged fuel costs. He says Ryanair should carry 116 million passengers and record a minimum net 2017 profit of 1.38 billion euros, 11 percent higher than Monday’s record figure. Analysts expect Ryanair to beat that forecast by at least 100 million euros.
O’Leary said Ryanair foresees its fleet of Boeing 737-800s growing this year by 53 aircraft to reach 380 as the airline expands eastward with seven new bases including Bucharest, Romania; Prague, Czech Republic; Sofia, Bulgaria, and the German cities of Hamburg and Nuremberg. Ryanair already is central to western Europe’s short-haul traffic with the biggest market share in Belgium, Ireland, Italy, Poland and Spain. It’s No. 3 in Germany and France and No. 2 in Britain where it’s battling to dethrone budget rival easyJet.
Ryanair shares rose 1.75 percent in early Dublin trading to 13.44 euros.
Monday’s net profit excluded an exceptional gain of 317.5 million euros from Ryanair’s November sale of its stake in rival Irish carrier Aer Lingus to IAG, the parent of British Airways. Ryanair launched three hostile bids for Aer Lingus that faced opposition from competition regulators, the Irish government and labor unions.
Analysts credit Ryanair’s 2013 decision to start improving customer service and broadening its product range as critical in driving its latest growth. A business previously infamous for surprise extra charges and cut-throat inflexibility now offers smoother online sales, family and business tickets, more relaxed baggage rules and better space on its new Boeing models.
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This article was written by Shawn Pogatchnik from The Associated Press and was legally licensed through the NewsCred publisher network.