Ryanair annual profit guidance soars 25 per cent amid passenger and fare growth

The bleak weather throughout the tail-end of summer may have been upsetting for consumers, but it was equally distressing for many businesses, which found that footfall fell as customers sought to keep dry.

Leisure firm Halfords was among the firms that reported “disappointing” results, with cycling sales deflating by 11 per cent over an eight-week period across July and August.

The bad weather didn’t dampen the fortunes of leisure budget airline Ryanair, meanwhile, as it reported a a ten per cent customer traffic increase year-on-year to reach 10.4m customers in August.

The firm’s CMO Kenny Jacobs attributed the record numbers to its Always Getting Better (AGB) customer experience scheme, which is built to improve services such as bookings, company websites and apps, cabin interiors and more.

On the back of the announcement, Ryanair has now reported a 25 per cent increase to its full-year profit guidance, with expectations growing from between €940m to €970m to €1.17bn to €1.22bn.

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The revised sums are down to the summer performance being stronger than expected, while the AGB programme was hailed as a successful way to keep bringing in customers on higher fares. The shareholder update was initially planned for 24 September, but the July and August number made the airline confident it could disclose a revision ahead of schedule.

Breaking down the figures, passenger traffic rose by 13 per cent in H1 on a ten per cent guidance, and fares in the period increased by two per cent from a flat guidance.

Looking ahead to Q3 the traffic growth is set to hit 15 per cent from a 13 per cent guidance, and fares are set to be flat, which improves on a decline of up to eight per cent. Passenger numbers for the full-year, meanwhile, are set to increase by one million to 104m.

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“During a year when Ryanair will grow traffic by more than 13m customers p.a. it’s clear that consumers all over Europe are delighted by and are switching to, our “Always Getting Better” (AGB) customer experience programme, our industry leading punctuality and our unbeatable low fares,” said Ryanair’s CEO Michael O’Leary.

O’Leary was keen to highlight that the AGB wasn’t the sole reason for the success, however, and pointed to “favourable industry trends” including poor weather in Northern Europe and a stronger sterling sending more families to the Mediterranean alongside lower oil prices.

He cautioned: “Being the airline industry we do not expect these favourable conditions will persist, and we would urge shareholders and analysts to avoid irrational exuberance while we continue to execute our very ambitious growth plans during what we expect to be very attritional and sustained fare wars across Europe this winter.”

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