Ryanair has announced plans for a share buyback program worth €700m (£599.3m) following a significant increase in full-year profit. The company’s profit after tax rose by 34% to a record €1.92bn, driven by strong demand for travel. Ryanair saw a nine percent increase in the number of passengers carried, reaching a total of 183.7 million. Despite the positive financial results, CEO Michael O’Leary has warned about potential delays in deliveries of Boeing aircraft.
Ryanair’s revenue increased by 25% to €13.4bn, driven by a 21% rise in average airfares to €49.8 and a strong first half of the year. However, the airline’s CEO cautioned that there may be challenges ahead.
In November, Ryanair announced its first-ever dividend and paid an interim dividend of €0.175 per share in February. The company also plans to complete a buyback program, which will bring the total funds returned to investors to over €7.8bn since 2008.
Ryanair, the largest airline in Europe, has outperformed its competitors Easyjet and Wizz Air over the past year, benefiting from a strong demand in the industry. However, the airline has been more severely affected by the problems faced by Boeing, its biggest customer. On Monday, Ryanair issued a warning that it would receive 23 fewer deliveries of Boeing’s 737 Gamechanger fleet by the end of July.
Ryanair’s chief executive, Michael O’Leary, has expressed concerns over the possibility of further delays in Boeing deliveries. The low-cost airline has been working closely with Boeing’s CEO, Dave Calhoun, CFO, Brian West, and the new Seattle management team to enhance the quality and expedite the delivery of B737 aircraft. However, O’Leary has acknowledged that there is still a risk of additional delays.
In addition to the Boeing delivery challenges, Ryanair has faced disruptions caused by French air traffic control strikes and escalating conflicts in the Middle East. These factors have not only led to the cancellation of thousands of Ryanair flights but have also resulted in an increase in oil prices.
The airline reported a significant increase in operating costs, attributing it to higher fuel costs, increased staff expenses, and delays in Boeing deliveries. Despite this, the company anticipates a growth in full-year traffic of eight percent, with an estimated range of 198 million to 200 million passengers, assuming there are no further delays in deliveries.
According to experts, the visibility regarding peak summer fares is limited at the moment. However, they are cautiously optimistic that the fares will either remain flat or show a slight increase compared to last summer.