Ryanair flight prices rise as air traffic profits increase

Sceala Philosopher Location: Dublin

We are all going to be paying more for flights with Ryanair, flight prices are set for a 12% increase. This as Ryanair makes huge profits increase.
Ryanair results - Passenger numbers up 8%
Ryanair's results for the year to the end of March show that the airline's profits rose by 26% to €401m and its traffic grew by 8% to 72 million passengers.
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Ryanair profits and revenues fly higher
The airline says it is pleased with the profits, achieved in a year of higher oil prices, global recession and volcanic ash disruptions in the early part of last year.
Ryanair's profits for the year to March rose by 26% to €401m and its traffic grew by 8% to 72 million passengers.
Revenues grew 21% to €3.6 billion euro, with average airfares up by 12%. But the airline also saw higher fuel costs, which rose by 37% to €1.227 billion as average oil prices rose from $62 to $73 a barrel and because of the increased number of hours flown.
Ryanair said that sales of ancillaries grew by 21% to €802m, faster than traffic growth. They amounted to 22% of total revenues.
Ryanair flight prices rise as air traffic profits increase
During the year, the airline opened eight new bases - El Prat, Gran Canaria, Kaunas, Lanzarote, Malta, Seville, Tenerife and Valencia - and started 328 new routes to bring its total to over 1,300.
Ryanair's chief executive Michael O'Leary says the airline is 90% hedged for the next year at $820 per tonne, or $82 barrel - a 12% increase on last year. He also predicted that higher oil prices will force further consolidations in the industry, increased competitor losses with the result that more companies will go bust.
Ryanair flight prices rise as air traffic profits increase
Looking ahead, Mr O'Leary said that Ryanair's traffic numbers are expected to grow by 10% in the first half of the year and then fall by 4% in the second half.
'H1 figures will be boosted by the late Easter and modest prior year comparables due to volcanic ash disruptions, but will be impacted by a 40% increase in first quarter fuel costs due to volume increases and favourable hedges in the first quarter of last year,' he said.
He said that since the airline has limited visibility on bookings, he remains concerned at the impact of the recession, austerity measures and falling consumer confidence on fares.
Cheapest Ryanair flights from Ireland to UK and Europe
Ryanair flight prices rise as air traffic profits increase
But despite these worries, Mr O'Leary said he was cautiously expecting that average fares will rise by up to 12% this year due to a better mix of new routes and bases and slower traffic growth.
'However, these higher fares will only help us to finance fuel and rising sector length related costs, and according, we expect profit after tax for full year 2012 to be similar to the year year 2011 result of €400m,' Mr O'Leary stated.
Shares in the airline were down 5.3% to €3.36 in Dublin by lunchtime.

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Ryanair flight prices rise as air traffic profits increase