Ryanair plans fare hikes after sharp profit drop
Ryanair said it will raise fares after reporting a sharp fall in quarterly profits, following a fine imposed by Italy’s competition authority for abusing its market position.
The budget carrier posted pre-tax profits of €24.4 million (£21.2 million) for the three months to December, representing an 83% decline compared with the same period a year earlier, News.Az reports, citing BBC.
Despite the drop in earnings, Ryanair said it remains confident about demand, forecasting passenger numbers to rise by 4% to nearly 208 million this year. The airline also revised up its fare outlook, saying it now expects average ticket prices to increase by between 8% and 9% this year, compared with a 7% rise it had projected in November.
In December, Italy’s competition watchdog fined Ryanair €256 million (£222 million), accusing the airline of “abusing its dominant position” by restricting travel agencies’ access to its booking services.
Releasing its quarterly results on Monday, Ryanair said it had appealed the Italian fine, calling it "baseless".
At the time of the ruling, the Italian Competition Authority said the company had "put in place an elaborate strategy" making it harder for online and traditional travel agencies to buy Ryanair flights through its website.
It said the airline's strategy blocked or hindered purchases, or made them "economically or technically burdensome", particularly when flights were combined with services from other airlines or with tourism and insurance products.
The airline said it was "confident" the fine would be overturned on appeal.
Ryanair made headlines last week after boss Michael O'Leary rejected the idea of using Elon Musk's Starlink technology to provide Wi-Fi on flights.
It resulted in an online spat between the two leaders, which the firm said had led to a slight rise in bookings, thanking Musk for the publicity.
O'Leary said on Monday that full-year net profit could reach as much as €2.23bn (£1.9bn).
But he said this forecast "remains exposed to adverse external developments" including the possibility of conflict escalation in Ukraine and the Middle East.
Ryanair is aiming to grow passenger numbers to 300 million by 2034.
Ryanair's $40bn (£31bn) contract with Boeing will see 300 new aircrafts - 737-MAX 10 - delivered to the company by March of that year. The airline is one of Boeing's largest customers.
The first 15 planes are expected to be in service in spring 2027.
The MAX-10 model is more fuel efficient and has 21% more seats than the airline's fleet of 737 Next Generation planes.
By Nijat Babayev
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