Irish no-frills airline Ryanair said Monday that third-quarter net profit more than doubled on surging passenger numbers, and unveiled an 800-million-euro ($866-million) share buyback programme. Earnings after taxation rocketed 110 percent to 103 million euros in the three months to the end of December, or third quarter of its financial year, compared with 49 million euros a year earlier, Ryanair said in a results statement.
Customer traffic jumped by a fifth to 25 million people in the reporting period. The Dublin-based carrier added it would return 800 million euros to investors via a share buyback, and cited its rising profitability and improving cashflow. Price promotions and heavy discounts offset the impact of weaker demand following last November's deadly Paris attacks. "Following a strong first half of Q3, we noted weaker pricing and bookings immediately after the terrorist events in Paris and Brussels," said chief executive Michael O'Leary.
"We reacted to this softness by running price promotions and discounted fares to stimulate double digit traffic growth." The company added that a modest dip in average fares was offset by lower costs, largely because of tumbling oil prices. Looking ahead, Ryanair predicted that fourth-quarter traffic would grow by 26 percent. That marked an increase of four percentage points on its previous forecast.
Full-year net profits were expected to sit towards the upper end of a forecast range between 1.175 billion euros and 1.225 billion euros. Analysts welcomed the quarterly results and accompanying share buyback. "Ryanair continues to deliver very strong profit," said Davy Stockbrokers in a note to clients, adding that the airline's cash generation was "spectacular". The global airline sector has meanwhile won a massive boost from collapsing oil prices because kerosene, or jet fuel, is refined from crude.
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