SHARES IN Ryanair rose 7 per cent yesterday after the airline predicted it would make a net profit after tax of €50-€80 million in the current financial year. The airline has previously guided the market that it would make a loss or reach break even at best for the year to the end of March 2009.
However, in a conference call with analysts, Ryanair said it had threatened to pull one-third of its Shannon-based fleet from the airport in a row over the introduction of an exit tax on passengers.
Airline executives said they had written to the Shannon Airport Authority to warn it would move two of the six aircraft servicing its routes out of Shannon for the summer schedule.
Ryanair has lobbied consistently against the €10-per-passenger airport travel tax introduced in the last budget. Chief executive Michael O’Leary has called instead for a levy “charged as a percentage of the passenger fare”.
Ryanair’s average fare declined by 9 per cent to €34 in the third quarter of its financial year, due to recession and weakening sterling.
Announcing third-quarter results, Ryanair said its financial turnaround was primarily the result of softening fuel prices.
Howard Millar, Ryanair’s deputy chief executive, says the airline’s fuel bill this year will be €1.3 billion. The airline expects to pay about €1.1 billion for fuel in the year to the end of March 2010, a period when it is projecting a 16 per cent rise in passenger numbers to 67 million. “We’re getting a big benefit from the fall in fuel prices,” Mr Millar said.
Ryanair yesterday announced a loss of €101.5 million for the three months to the end of December. This compared with a profit of €35 million in the same period of 2007. Passenger numbers in the quarter rose by 13 per cent to 14 million and revenue increased by 6 per cent to €604.5 million,
The airline expects fares to decline by 20 per cent in the final quarter of its financial year as it continues to price its fares aggressively to win business from rivals.
In relation to its failed €1.40-a-share bid for Aer Lingus, Ryanair yesterday indicated that it would seriously consider any offer that might be made for the Irish airline by a third party.
Mr Millar said Ryanair had no plans to reinstate the two aircraft that it mothballed at Dublin airport for the winter period but added that the seven aircraft removed at the same time from its schedule at Stansted would be reinstated on March 29th.
Ryanair chief operating office Michael Cawley said yesterday the airline was in talks about placing an order for 300-400 short-haul jets. – (Additional reporting by Financial Timesservice)
