European budget airline Ryanair is predicting a “flat or modest” increase in airfares this summer after recording a 34 per cent rise in its annual profits.
The Irish carrier made a net profit of €1.92 billion in its financial year running until the end of March 2024 – up from €1.43 billion during the previous year. Ryanair was buoyed by a 25 per cent rise in revenue which came in at €13.4 billion as passenger traffic jumped by 9 per cent to 183.7 million travellers.
Ryanair’s group CEO Michael O’Leary said that the results had been achieved despite delays in receiving new aircraft from Boeing, which had forced the airline to trim some of its capacity for the coming months.
O’Leary said travel demand in Europe was “strong” for summer 2024 and it would operate its largest ever during the season’s schedule despite the Boeing delivery delays. This includes introducing 200 new routes and five additional airport bases.
He added that overall short-haul capacity around Europe would be “constrained” this summer, as some competitors have been required to ground Airbus A320 aircraft to allow time for engine inspections to be carried out.
On the likely movement of fares this summer, O’Leary said: “We remain cautiously optimistic that peak summer 2024 fares will be flat to modestly ahead of last summer.”
This marks a significant change from earlier this year when O’Leary predicted that airfares in Europe might go up by as much as 10 per cent this summer due to delays in aircraft deliveries.
As a comparison, Ryanair’s average fares in the 2023-24 financial year went up by 21 per cent year-on-year to €49.80, while ancillary sales increased to €23.40 per passenger.
Despite capacity constraints, Ryanair expects traffic in the current financial year to rise by a further 8 per cent, which would put the company on course to hit 200 million annual passengers for the first time. Although this prediction requires Boeing deliveries returning to “contracted levels” before the end of the year.
Ryanair said it could not give a “sensible or accurate” forecast for its profit in the 2024-25 financial year as this would be “heavily dependent upon avoiding adverse events”, such as the wars in Ukraine and the Middle East, air traffic control disruptions and further Boeing delivery delays.