Ryanair, Europe’s biggest budget airline (stock market valued £2.6 billion) reported a 45% rise in pre-tax profits to e78.8 million (£47.4 million, US$67.8 million) in the six months to 30 September. This rise was made by carrying a third more passengers and saving £20 million (US$28 million) in costs by moving sales and distribution to the internet. ‘The most dramatic change in our cost base this year has been the rapid growth of Ryanair.com,’ said O’Leary. Travel Agent sales have fallen from year 60% to 10% since the introduction of its internet offering in January.
Improved yields have seen revenues rising by 38% to e265 million, marketing and distribution costs had fallen by 31%. Passenger numbers will reach seven million this year, after the company reported 3.85 million for the holiday-biased first half. The results put Ryanair shares to a new record of 580p, up 7 1/2p.
‘In an adverse trading environment characterised by intense competition and higher fuel prices, this is an outstanding performance,’ said O’Leary. ‘These results underline the robustness of Ryanair’s superior earnings model at a time when almost all of our principal European competitors are reporting downturns in profitability or losses.’
Michael O’Leary chief ruled Ryanair out as a bidder for Go, recently put up for sale by British Airways. Maybe if the price was right and we could go in there and butcher it. But I doubt it.’ he doubted Go could be profitable year-round in the long term, as it flies to expensive European airports and this affects its ability to offer the lowest fares at a time of cut-throat competition.
He said Ryanair remained committed to flying only to what he called the ‘Bognor Regis airports of Europe’ - unfashionable, low-cost destinations in which it can turn round aircraft in 25 minutes.
Howard Miller CFO of Ryanair is keynoting Europe’s biggest meeting of web focussed travel executives E-commerce for Travel Europe. The show takes place in Paris in April.