Ryanair early summer profits nearly quadruple on higher prices and booming demand

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Higher ticket prices and booming demand helped Ryanair post record profits at the start of the summer, but the low-cost airline was forced to trim its passenger forecasts because of Boeing delivery delays and warned of an uncertain winter ahead.

Ryanair on Monday reported profit after tax of €663mn for the three months to the end of June, nearly four times higher than in the previous year and well above its previous record for the quarter of €397mn in 2017.

The low-cost airline followed UK-listed easyJet in delivering record profits, as airlines cash in on strong demand and passengers’ willingness to pay higher air fares despite the weak European economy.

Ryanair said its year-on-year comparisons in the quarter were boosted by a strong Easter and an extra bank holiday in the UK, as well as a weaker performance in 2022 because of Russia’s invasion of Ukraine.

Revenues increased 40 per cent to €3.65bn in the period, more than offsetting a 23 per cent rise in costs, thanks to higher fuel and staff bills.

Average air fares rose 42 per cent year on year to €49, but Ryanair reported a “softening” of fares booked by people close to their time of travel in late June and July. It forecast fare rises would ease to “a low double-digit percentage” in the current quarter.

Chief executive Michael O’Leary said the airline had little visibility into travel demand heading into the winter, but added “consumers may require some fare stimulation . . . following months of rising mortgage rates and consumer price inflation”.

Ryanair bought 300 short-haul aircraft in a $40bn deal with Boeing earlier this year, and has outlined ambitious plans to grow passenger numbers by more than a third to 300mn a year by 2034.

But the airline was on Monday forced to slightly trim its passenger forecasts for its financial year from 185mn to 183.5mn, which it blamed on expected aircraft delivery delays from Boeing.

Chief financial officer Neil Sorahan said the delays were not Boeing’s fault, as he pointed to a strike in the manufacturer’s supply chain and logistical problems caused by the collapse of a rail bridge used to transport aircraft fuselages.

“I think there is a curse on them, they seem to be very unlucky,” Sorahan said.

Sorahan added there had been no impact on bookings from the extreme heatwave across parts of southern Europe, including forest fires in Greece that have forced some airlines to launch emergency repatriation flights.

“Weekend bookings were still very strong,” he said.