Analysts forecast Ryanair profits of €860m

Ryanair is due to report full-year results tomorrow, with Goodbody Stockbrokers forecasting net profits of €860 million. The airline raised its full-year profit guidance for a fifth time earlier this year, and is guiding profits of €840-€850 million.

Ryanair’s guidance started out at €580-€620 million before rising through the year, driven by rising demand and increased passenger numbers.

“While there is always the danger that the company talks down expectations at the results briefing, citing yield pressures and the cost of expansion, we believe FY16 returns will be driven by a 1 per cent load factor gain on capacity growth of 9.2 per cent,” Goodbody said.

Goodbody said this will be supported by ticket price declines of 4.45 per cent, driven by fuel savings, with this partially offset by a positive foreign exchange gain of 1.57 per cent.

Ryanair reported its first fall in profits in five years last May, as a result of intense competition in European short-haul routes. It reported a full-year net profit of €523 million – a drop of 8 per cent on the previous year.

Revenue per passenger was flat for the year, as strong ancillary revenue growth offset a 4 per cent fall in average fares. At the time, Ryanair said higher average ticket prices during the summer of 2014 would help lift profits by up to 20 per cent.

In April, Ryanair was hit by a criminal scam in which about $5 million (€4.6 million) was taken from one of its bank accounts. The funds were removed from a Ryanair account last week by electronic transfer via a Chinese bank.