Ryanair is vowing to cut ticket prices by up to seven percent after posting record annual profits.
The low-cost Irish airline earned a net profit of more than 1.3 billion euros last year, even though fares were discounted by an average of 13 percent.
Ryanair lifts profits despite slashing fares to stimulate demand https://t.co/zelsoVqpTK— Financial Times (@FinancialTimes) May 30, 2017
Despite a positive outlook, however, the company said it must be prepared for any possible turbulence ahead.
Kenny Jacobs, the Chief Marketing Officer of Ryanair, said: “For the industry in general I think uncertainty over Brexit, that is the single biggest issue.
“Other than that there is over-capacity in Europe as charters are moving out of Turkey, north Africa, into mainland Europe. They will continue to be the two biggest challenges in the coming year.
“And, finally, it will be security events.”
But despite concerns about the impact of terrorist attacks on travel, Ryan Air says it expects to increase its net profit in the current year by about eight percent, reaching up to 1.45 billion euros.
The company says it aims to add an extra 10 million seats of capacity and lower fares by five to seven percent.
Ryanair earnings gain 6%, with Europe’s biggest discount airline planning to order more jets https://t.co/AUvUjCLsPbpic.twitter.com/qnnhw4w1zI— Bloomberg (@business) May 30, 2017
Ryanair’s costs have been significantly cut by the fall in the value of the sterling over the past year, as it expands into new markets in Europe.
The airline says it also expects to make more savings from more fuel-efficient planes with more seats and from a five-year pay deal with staff.
“The gap is widening between Ryanair and our competitors,” Chief Executive Michael O’Leary said.
Ryanair defies terror threat and weak sterling to report profit spike https://t.co/mGrnocPwK3— The Independent (@Independent) May 30, 2017