Ryanair fares vow to boost business
Budget airline Ryanair has vowed to cut average fares by up to 10% as part of a bid to fly an additional five million passengers over the winter period.
The Dublin-based carrier believes there are "many opportunities" open to it, such as competing more vigorously at primary airports and in attracting business traffic which tends to travel more during the winter period.
Its "ambitious" new forecasts for the six months to March 31 include the plan to fly an additional 2.2 million passengers compared with its previous estimate - leading to a total rise of 16% or 5.3 million customers on a year earlier.
It now expects annual profits of up to 770 million euros (£602 million), a rise of 18% on its previous guidance. Profits for the summer half-year were 32% higher at 795 million euros (£621.6 million), the company added.
The airline's recent drive to improve its image is showing signs of paying off, having softened its stance on baggage charges and booking conditions and introduced allocated seating and a new business service.
Ryanair said average fares will fall by between 3% and 5% in the current quarter before an aggressive promotional drive will cut fares by between 6% and 10% in the new year.
As a result, the airline expects to carry 89 million customers in the year to March 31, a rise of 9% on a year earlier and the second such upgrade since September. Average fares will be up by 1% to 47 euros (£36.76) across the year as a result of higher prices over the Easter period.
Ryanair opened 57 new routes and added four new bases - in Athens, Brussels, Lisbon and Rome - during the summer period.
It also rolled out improvements to its website and mobile app and said it was "pleasantly surprised" at the uptake of its new business offers, which it believes have enabled it to win new customers from rivals.
The airline added: "We expect the uptake of our Business Plus service to build during our winter schedule which offers many more business routes to\from primary airports."
Ryanair has also locked in the recent fall in oil prices by hedging 90% of its requirement for the 2016 financial year at about 93 US dollars per barrel.
Its Dublin-based shares rose as much as 10% today while in London other travel stocks benefited from the signs of increased demand as easyJet and British Airways owner International Airlines Group lifted 2%.