Ryanair expects its profits to hit €850m
Ryanair hiked its profit guidance today as boss Michael O'Leary hailed a revamp designed to improve its image and attract business customers.
The budget carrier now expects an annual profit of €840-850m, up from previous guidance of €810-830m, but cautioned of "modest" growth in the following financial year.
Fares would be lower due to the oil price slump, though rivals who had bought less fuel in advance stood to benefit more.
Ryanair said net profit for the third quarter to the end of December was €49m, up from a loss of €35m in the same period a year before.
Investors were rewarded with a €400m share buy-back programme while there will also be a €520m special dividend. But shares, which recently hit an all-time high, fell 3pc.
"These strong results confirm that our 'Always Getting Better' customer programme and expanded business schedule, coupled with our substantial fare and cost advantage over competitor airlines is drawing millions of new customers to Ryanair," said Mr O'Leary (inset).
The airline said low oil prices would help it shave costs in the current final quarter. Traffic should grow by 25pc and average fares fall by 6pc-8pc as price cuts are used to help expand the network and boost business schedules.
Ryanair said some competitors would be "significant beneficiaries" from the lower oil price as they bought less of their fuel in advance in 2015/16, putting downward pressure on fares.
The group said analysts and investors should be "mindful of this likely increased price competition".
"As lower oil prices kick in over the next two years, Ryanair intends to pass on much, if not all, of these savings to our rapidly growing customer base in the form of lower fares and therefore our profit growth will be modest in FY16," it said.
Ryanair, which is this year celebrating its 30th anniversary, said passenger traffic in the third quarter grew 14pc to 21m with the average fare up 2pc to €40. Revenues grew 17pc to €1.13bn.