Ryanair profits up 25%

Ryanair boss Michael O’Leary unveiled record profits for the airline today but admitted it is unlikely there will be a repeat performance this year.

The Dublin-based carrier flew 75.8 million passengers in the year to March 31, an increase of 5% on a year earlier and helping it to lift net profits by 25% to €502.6m.

A 30% jump in fuel costs was offset by a 16% rise in average fares, partly due to the grounding of 80 aircraft over the winter, while ancillary revenues such as in-flight sales surged 11% to €886.2m.

Ryanair expects passenger numbers to rise by another 5% this year but with its fuel bill increasing by another €320m it has warned profits this year were likely to be in the range of €400m and €440m.

Mr O’Leary said the combination of rising oil prices and EU-wide recession would continue to hurt the sector following the failures over the last year of Malev in Hungary, Spanair and Cimber Sterling in Denmark.

He added: “We expect more European failures in 2012, as higher oil prices and recession continues to expose failed airline models as well as subscale or peripheral carriers.”

Mr O’Leary said that despite the rising number of airline failures, many of Europe’s governments continued to treat the sector and airline passengers as a “cash cow” to fund their taxation.

He said: “UK air passenger duty has caused traffic to decline by 6% since 2007, while the UK Government’s ’do nothing’ policy about runway capacity in the South East is encouraging traffic and tourism to bypass high-cost London airports in favour of expanding airports in Spain, France and Holland.”

"In Ireland, the new Government after one year in office has so far delivered no change or reform in the Dept of Transport’s failed policy of protecting the high cost DAA airport monopoly," he added.

"Traffic at the three DAA airports has declined 25% from 30m in 2007 to 22, in 2011.

"At a time when Irish unemployment exceeds 14%, and youth emigration is rising, it’s time the new Irish Government adopted a radical reform policy including breaking up the three DAA airports, and selling one or both of the two Dublin airport terminals to raise funds for Government and allow competition deliver lower costs, traffic growth and jobs."