Ryanair Q1 Profit Climbs; Cautious About Annual Profit View; Stock Down

(RTTNews) - Low fare airline Ryanair Holdings Plc. (RYA.L, RYAAY) Monday reported higher profit in its first quarter, boosted by increased traffic and load factor. Looking ahead, the company remains cautious about weak prices and yields this winter. Ryanair shares were trading around 3 percent lower in London.

Ryanair's Michael O'Leary said, "We think it is too early in the year to alter our full year profit guidance, although the slightly better H1 yields will push it towards the upper end of our previously guided range of €940m to €970m net profit."

"We caution however that this guidance, which is 12 percent ahead of last year's profit, is heavily reliant on the final outturn of H2 fares over which we currently have almost zero visibility," he added.

For the first quarter, pre-tax profit was 277.8 million euros, higher than last year's 223.6 million euros. After tax profit - all attributable to equity holders- climbed 25 percent to 245.1 million euros. Earnings per share grew to 17.81 euro cents from 14.18 euro cents last year.

Operating profit increased 24 percent year-over-year to 288.4 million euros, and operating margin increased 2 points to 18 percent.

Total operating revenues from continuing operations improved 10 percent to 1.653 billion euros, driven by higher results in scheduled and ancillary businesses.

Total passengers in the quarter were 28 million, 16 percent higher than last year's 24.3 million. Load factor went up 6 points to 92 percent.

Meanwhile, total revenue per passenger fell by 4 percent. The company reported a 4 percent reduction in average fare to 45 euros, partially due to the timing of Easter, weaker April yields and lower checked baggage penetration.

Ryanair further said its campaign to "Keep Greece Flying", under which it dropped prices significantly, has been well received.

The airline said it would continue to oppose the UK CMA's 2013 divestment ruling, which was based on the invented theory that no other airline would bid for Aer Lingus while Ryanair was a minority shareholder.

Based on the quarterly performance and reasonable visibility into the second quarter, the firm now believes that average fares for the first half will be broadly flat, compared to the previous guidance of 0 to -2 percent.

The company expects that second-half fares will be towards the higher end of its negative 4 percent to negative 8 percent guidance range.

Traffic is expected to increase 13 percent in first half and slightly faster at 15 percent in second half.

In London, Ryanair shares were trading at 11.94 pence, down 2.69 percent.