Ryanair announces first quarter profits

Ryanair, Europe's largest low fares airline, has announced a net profit for the first quarter of 2009 of €136.5 million, but predicts lower annual profits than previously forecast.

Although the figures represent a €115.5 million increase on the same period last year, total revenues were flat due to an 11% rise in traffic being offset by a 13% decline in average fares. The airline has thus predicted that full-year profits will be at the lower end of the €200-300 million figure previously estimated.

Michael O'Leary, Ryanair's CEO, said: "These quarterly results are distorted by a 42% reduction in fuel costs. Thanks to a 13% reduction in average fares we grew traffic by 11%, which was a robust performance in a deep recession, when many of our competitors were cutting flights, losing traffic and reporting increased losses.

"Most of our competitors have recently reported declining traffic, falling yields and substantial losses," continued O'Leary. "Our Q1 traffic growth of 11% to 16.6 million has extended Ryanair's leadership over the other Big 3 (high fare, fuel surcharging) airline groups - Air France, BA and Lufthansa. Our successful roll out of new routes and bases demonstrates the fundamental strength of Ryanair's lowest fares model which even during deep recessions continues to deliver growth."

O'Leary also remained defiant over criticism of the UK government's £10 Air Passenger Duty tourist tax: "We announced plans to reduce winter capacity at Stansted by 40% or 16 aircraft because of BAA's unjustified increase in airport charges (despite enormous traffic falls) and the damage done to UK tourism by the £10 APD tourist tax. We will switch a substantial number of our aircraft from Irish and UK bases this winter to other European bases where progressive airports and sensible governments are scrapping tourist taxes and/or reducing airport fees, in some cases to zero."

The airline reiterated that the outlook for the rest of the financial year remained cautious, with the recession showing no sign of abating.

Full details of the Ryanair announcement can be found at www.ryanair.com.

Flying with Ryanair? Remember to book great value travel insurance and ensure that you're covered for your trip.

July 27, 2009