Ryanair has reported an 80% increase in after-tax profits for the first six months of its financial year to the end of September. After-tax profits rose to €387m from €214.6m the same time last year.
The airline, which carried 36.4 million passengers in the six-month period, says it benefited from declining fuel costs which shielded it from a 17% fall in average fares. Fuel costs decreased by 42% to €459.8m in the six months to September.
The airline increased passenger numbers by 15% on the same time in 2008, but revenues fell by 2% to just under €1.8 billion on the back of those lower fares.
Ancillary revenues grew 8% to €346.3m, or 20% of the airline's total revenues. This was lower that the increase in passenger volumes due to a decline in average spend per passenger due to lower excess baggage revenues and the negative impact of the euro/sterling exchange rates.
Total revenue per passenger fell by 15%, while the airline's load factor was flat at 85% in the six-month period.
Ryanair says it expects fares to decline by up to 20% in the second half of the year, resulting in the next six months being loss making. However, it affirmed its forecast for full-year net profit at the lower end of a €200-300m range.
'Thesre results are heavily distorted by a 42% fall in fuel costs, which has masked a significant 17% decline in average fares,' commented CEO Michael O'Leary.
'We expect average fares to decline by up to 20% during quarters three and four, which will result in both of these quarters being loss making. Despite this our full year guidance remains unchanged and will be substantially profitable, at a time when many of our competitors are losing money, consolidating or going bust,' he added.
He said that at a time of economic difficulty he is appropriate to remain cautious and conservative in Ryanair's guidance. 'Ryanair's yields are being negatively impacted by the weakness of sterling and tourist taxes in the UK and Ireland,' he added.
'While this winter will be a difficult one for the European airline industry, Ryanair will continue to grow traffic, market share and profits,' the CEO said.
Ryanair calls for scrappage of 'stupid' €10 travel tax
The airline again called on the Government to scrap what it describes as the 'stupid' and 'misguided' €10 passenger tax introduced in April.
Michael O'Leary also criticised the soon to open Terminal 2 at Dublin Airport. He said the new building is a white elephant for what it terms 'deep queuing check-in spaces' at a time when airlines are using the web to reduce check in.
The airline has a cash pile of €2.5 billion and says it will continue to bargain hard for lower costs with airports and handling companies while preparing to emerge stronger from recession in Europe.
Ryanair said it was still winning substantial market share from major flag carriers Air France-KLM, British Airways and Deutsche Lufthansa.
Europe's biggest budget carrier said its talks with Boeing on an order for 200 aircraft had not progressed much, adding it could end its traditional relationship with the aircraft maker.
'We see no point in continuing to grow rapidly in a declining yield environment, where our main aircraft partner is unwilling to play its part in our cost reduction programme,' Ryanair Chief Executive Michael O'Leary said.
'If we cannot invest our surplus cash efficiently in new aircraft, then we should distribute it to shareholders,' O'Leary added.
Ryanair shares closed down six cent (1.9%) at €2.89 in Dublin.
