Ryanair Forecasts Fare Increase as Summer Demand Surges in EuropeRyanair Forecasts Fare Increase as Summer Demand Surges in Europe

Ryanair sees rising demand and fare recovery after last year’s profit and fare drop.

Ryanair, Europe’s biggest airline by passenger numbers, says it is seeing strong travel demand across all its routes and expects ticket prices to rise after falling last year. The airline reported a 16% drop in annual profit for the year ending March 31 due to weaker demand and issues with online travel agents. Over the same time span, fares decreased by 7%.

However, Ryanair’s Chief Financial Officer, Neil Sorahan, said that demand is strong in all 37 countries where the airline operates. He expects fares to bounce back, recovering most of last year’s decline. Average ticket prices are now expected to rise by about 7%, higher than the earlier forecast of 4-6% made by CEO Michael O’Leary in March.

Shares in Ryanair rose 3.4% to 23.17 euros on Monday. Since early May, the share price has remained over 21 euros, positioning O'Leary for a potential bonus of almost 100 million euros. Ryanair expects that the timing of the Easter vacations will help to drive up fares by a "mid-to-high teen percent" over the same period last year. Bookings for the summer are also marginally higher than they were last year.

The airline met expert projections with an after-tax profit of 1.61 billion euros ($1.8 billion) for the entire year. Last year, Ryanair carried a record 200 million passengers just shy of its initial target of 205 million because of delays in the delivery of Boeing aircraft. In the upcoming year, it now plans to transport 206 million passengers.

Ryanair expects only a small rise in costs this year, thanks to new planes, fuel deals, and cost controls, even as air traffic control charges and environmental taxes increase. The airline also warned it may cancel future Boeing orders if tariffs raise aircraft prices.