Ryanair Holdings PLC share price up, posts soaring quarterly profit, raises full-year outlook

Ryanair Holdings PLC, Europes largest discount airline, gained 4% today, as the company revealed it has more than doubled Q1 earnings. The Dublin-based company, which is now valued at about €9.8 billion, also raised its full-year profit projection.

“Weve made a lot of service improvements over the last six or seven months and were seeing the benefits,” CFO Howard Millar said.

The airline posted results for the three months through June 30 today, logging a massive 152% net profit increase on an annual basis, at €197 million. Revenue also rose 11% to €1.496 billion, while the number of passengers increased by 4%. Millar said that paying to choose a seat was particularly popular among passengers, while strong forward bookings also added a good chunk, reflecting the positive feedback to the shift towards early scheduling.

“The earlier launch of our summer schedule and actively raising our forward bookings has delivered a 4% increase in load factor to 86% and enabled us to better manage close-in yields,” CEO Michael O’Leary said.

The airline also raised its full-year profit forecast from €580-€620 million to €620-€650 million.

The boost in profit guidance “is due to a larger number of passengers, which reduces unit costs, so it’s a cost-driven increase,” Millar said.

Ryanair said it expected traffic growth of 3% in the first half, ending September 30, and fares to increase by 6%. The company also revealed that it plans to “aggressively” expand its capacity by 8% this winter, and build a business-friendly network.

The airline also plans to pay a €520 million dividend, or 37.50 euro cents per share, as part of its commitment to return €1 billion to shareholders. The company has already bought back €482 million worth of shares.

Ryanair Holdings PLC was up 3.74% to trade at €7.10 per share, logging a one-year drop of 0.98%. According to the Financial Times, 22 analysts offering 12 month price targets for Ryanair Holdings PLC have a median target of €8.00, with a high estimate of €9.90 and a low estimate of €7.00. The median estimate represents a 16.87% increase from the last price of €6.85.