Ryanair Profit Climbs On Strong Demand

(RTTNews) - Irish low-cost airline Ryanair Holdings PLC (RYA.L, RYAAY) reported Tuesday significant increase in fiscal 2015 earnings, as there has been a 11 percent traffic growth and the company was able to contain unit cost.

Looking ahead, the company expects that lower unit costs in fiscal 2016 would provide a 10 percent improvement in profits, which should, subject to second-half yields over which the firm has no visibility, rise to a range of 940 million euros to 970 million euros for the full year to March 2016.

For the full year, profit attributable to equity holders climbed 66 percent to 867 million euros from 523 million euros in the prior year.

Earnings per share rose 69 percent to 62.46 euro cents. Profit before tax was 982.4 million euros, compared to 591.4 million euros.

The company attributed the increase in earnings primarily to a 1 percent increase in average fares, a 11 percent increase in traffic, a stronger load factor, and 11 percent fuel savings per passenger. There has been 1 percent reduction in fuel costs.

Operating revenue grew 12 percent to 5.654 billion euros from 5.037 billion euros reported last year. Scheduled revenues improved 12 percent to 4.26 billion euros aided by the timing of Easter in the first quarter and its absence in the prior year comparative, along with a 5 percentage point increase in load factor.

Ryanair said traffic was up 11 percent to 90.6 million customers from prior year's 81.7 million customers as load factors rose 5 points to 88 percent from 83 percent.

Total revenue per passenger rose 1 percent, primarily due to the strong growth in scheduled revenues.

Unit costs excluding fuel remained flat, however, including fuel unit costs fell 5 percent, benefited from lower unhedged fuel prices.

Operating profit increased 58 percent to 1.04 billion euros, and operating margin increased 5 points to 18 percent.

The company said it continues to experience strong demand and forward booking momentum, reflecting growth into primary airports and the impact of its Year 1 AGB programme.

Regarding the current trading, the company said its average load factors in the first four months of 2015 grew 10 percent. While this will slow to 1 or 2 percent over the peak summer months, forward bookings are on average 4 percent ahead of this time last year, the company said.

The company said its traffic growth this year will about 10 percent, yet it warned that the firm may suffer periods of fare/yield weakness especially during the second half winter season even with the benefit of lower oil, aircraft and financing costs.

In London, Ryanair shares gained 1.40 percent on Friday and settled at 10.90 euros.