Ryanair Profit Boost Despite Rising Costs

Budget airline Ryanair has reported a 20% increase in half-year net profits, despite higher oil prices.

The Dublin-based carrier's profits jumped to £467.7m in the six months to September 30, compared to the same period last year.

The carrier said revenues were up 24% to £2.7bn, while passenger numbers rose 12% to 44.7 million.

Ryanair chief executive Michael O'Leary told Sky News a combination of higher fuel prices and the recession across Europe meant that more people were switching to the budget airline, which offers no fuel surcharges.

"People are still flying in the recession, but they are becoming more and more price sensitive, so in a recession, Ryanair is doing really well," he said.

He said average fares rose because of a better mix of new routes and as competitors put up their prices due to higher costs.

But Ryanair says passenger numbers will fall by 10% this month as it grounds 80 planes over winter because of fuel prices.

The company's chief financial officer, Howard Millar, reiterated that the airline has "not seen any impact from recession".

He added: "We are well booked for the coming months, fractionally ahead of where we were last year."

The carrier earned £387m in the six months to September, up 20% from a year earlier, on revenues of £1.87bn.

Net profit before tax for the three months to September was £346m.

Ryanair closed on Friday at £3.13 per share, down 8% since the beginning of the year.

It opened on Monday slightly down at £2.96, compared with a fall of 21% at rival low-cost carrier EasyJet.

Industry body International Air Transport Association (IATA) has said it expects airlines to suffer a weak end to the year due to waning consumer confidence, sluggish international trade and high fuel prices.

Lufthansa last week reported results battered by high fuel costs, while International Airline Group on reported a 31% fall in third-quarter profit.