Ryanair raises guidance
Ryanair today (Nov 3) announced that H1 Net Profit rose by 32% to €795m. Traffic grew 4% to 51.3m customers, ave. fares increased 5%, and total revenues rose by 9% to €3,537m. Unit costs fell by 2% (excluding fuel they rose by 3%). H1 load factors jumped by 4% points to 89%, due to a stronger Easter period and the success of Ryanair’s “Always Getting Better” customer experience improvements.
Ryanair’s CEO, Michael O’Leary, said: “We are pleased to report this significant increase in H1 profits. While partially due to the presence of Easter in Q1 and a weak prior year comparable, we have also enjoyed a strong summer thanks to our strategy (announced Sept. 2013), of raising forward bookings and improving our customer experience which has delivered higher load factors and yields. We achieved a number of milestones during the half year including:
· H1 profits up 32% to €795m.
· Traffic up 4% to 51.3m (load factor up 4% points to 89%).
· Average H1 fare up 5% to €54.
· 4 new bases and 57 new routes opened.
· Improved website and mobile app rolled out.
· “Always Getting Better” customer experience improving.
· “Family Extra” and “Business Plus” products launched.
· €850m 7yr Euro bond issued @ 1.875%.
· €520m special dividend in Feb 2015 approved.
· Launch order for 200 Boeing 737-MAX “Gamechanger” aircraft (sub. to EGM approval).
· Revised growth plan to double to 150m p.a. customers by 2024.
The 5% rise in average fares and the 4% point increase in load factors has driven a 32% increase in H1 profits and validates our “Always Getting Better” programme and higher forward booking strategy. Our customers are finding it easier to locate and book our lowest fares on our improved website, while our new responsive mobile app has been downloaded more than 3m times in just 6 months. The customer experience is also improving at every touch point from mobile booking, online check-in, a smoother boarding process, and a friendlier on-board service where customers are really enjoying allocated seating and using their PED’s.
Half year unit costs fell by 2%. Excluding fuel they rose 3% mainly due to higher landing and handling costs at primary airports, and a higher marketing spend to support the “Always Getting Better” programme. H1 Ancillary revenue grew by 4% to €741m in line with traffic growth as airport and baggage fee reductions were offset by the increased uptake of allocated seating.