Ryanair raises profit forecast

Ryanair has raised its profit forecast for the year as higher ticket prices offset the rising cost of fuel and a slight dip in traffic.

The no-frills airline said it expected to post profit of €480 million for the year, up from previous expectations of €440 million.

In the three months to December 31st, the company made a pre-tax profit of €15.5 million after tax, with revenue rising 13 per cent to €844.4 million for the period.

The milder winter also contributed to the increased profit, as fewer flights were cancelled.

The average fare charged by the airline rose by 17 per cent in the quarter compared with the same period in 2010, but passenger numbers declined by 2 per cent.

"The EU recession, higher oil prices, the unfolding failure of the package tour operator model, significant competitor fare increases and capacity cuts, has created enormous growth opportunities for Ryanair," chief executive Michael O'Leary said.

The airline is facing higher costs, however, with fuel bills set to rise further in its fiscal year 2013. Mr O'Leary described a projected €350 million increase in its total fuel bill next year as "a significant cost challenge".