Airline’s profits rise to €452m

RYANAIR has raised its full-year guidance, as net profits increased 17% to €452 million for the six months to the end of September.

Its shares fell almost 4% yesterday to €3.97 as it reported half-year results.

Ancillary revenues, which include onboard spending and baggage charges, rose 22% to almost €220 million, while revenues jumped 23% to €2.2 billion.

Ryanair’s fuel bill soared 44% in the first half, due to higher prices and increased activity.

It expects full-year net earnings to rise about 8% to between €380m and €400m – from a previous guidance of €350m to €375m – as yields improve on the back of more profitable, longer routes. It said its outlook for the fourth quarter was cautious, due to little visibility on yields.

Chief executive Michael O’Leary said it was “wrong to assume there won’t be a double-dip recession”, particularly in Britain.

However, he said downturns allowed Ryanair the opportunity to continue growing, as it attracted more price-sensitive consumers.

It said it wants to increase capacity in Cork and Shannon airports, but won’t do so until charges there fall. Mr O’Leary said the only airports he was not talking to about increased capacity were in Ireland, along with Britain’s Stansted airport, which he criticised for having a high cost base.

Stephen Furlong, at Davy Stockbrokers, said: “The momentum and performance of the company are strong. They are reasonably bullish into the winter.”

Ryanair’s chief operating officer Michael Cawley said the carrier had not yet reached any concrete deals with Boeing over an order of 200 aircraft for 2013 to 2016. Ryanair said last year talks had stalled over price.

For the three months to September 30, Ryanair posted a net profit of €330.3m compared with a €250.5m net profit a year earlier. Diluted earnings per share in the second quarter rose to 21.96 cents from 16.9 cents a year earlier.

Cash on hand at September 30 rose by €212m to €3.03bn.

Ryanair’s fuel needs are 90% hedged for fiscal 2011 at $730 per ton and 60% hedged for 2012 at $760 per ton. It extended its dollar cover and is 60% hedged for 2012 at euro/dollar 1.35 versus euro/dollar 1.40 for 2011.

Last May, Ryanair said it would pay a one-off dividend of €500m or €0.34 per share, in October. This is its first dividend since going public in 1997.

Yesterday, Ryanair repeated its call for the Government to abandon the €10 per passenger air travel tax.