Business, Economics and Jobs

Ryanair reports record high profits


Irish budget airline Ryanair CEO Michael O'Leary speaks during a press conference in Marignane, France, on July 26, 2011.



LONDON, UK – European budget airline Ryanair has reported record profits for the year to March, but warned that it expects profits to fall in the coming financial year due to rising fuel costs and a gloomy economic outlook.

Net profits rose 25 percent to 503 million euros ($642 million), while revenue was up 19 percent to 4.3 billion euros ($5.49 billion), Sky News reports.

Passenger traffic grew 5 percent to 76 million while fares rose by 16 percent on average, helping the Dublin-based airline to overcome a 30 percent increase in fuel costs.

According to Reuters, Ryanair also confirmed it would pay out 483 million euros ($617 million) to shareholders, in only its second dividend payout since floating in 1997.

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However, in a statement the company said profits in the current financial year could be lower, and predicted annual profits of 400-440 million euros ($510-560 million) for the year to end of March 2013.

“Recession, austerity, currency concerns and lower fares at new and growing bases in Hungary, Poland, provincial UK and Spain will make it difficult to repeat this year’s record results,” it said.

The company also criticized the UK government’s decision to raise air passenger duty, saying:

“Many of Europe’s governments continue to treat aviation (and airline passengers) as a cash cow to find their taxation and/or policy failure.”

In an interview with the BBC on Monday, Ryanair chief executive Micheal O’Leary said his airline could benefit from the worsening outlook as passengers would not stop going on holiday but instead switch to lower cost carriers.  

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