Ryanair reported a €123 million ($174.6 million) net profit in its fiscal first quarter ended June 30, reversed from a €90.5 million loss in the year-ago period, but it issued a warning that full-year net income will be at the lower end of its previous guidance of €200-€300 million because its full-year decline in yield will be "at or slightly more" than 20%.

The company booked a €13.5 million impairment charge on its Aer Lingus stake, reflecting the fall in EI's share price, but that number was far lower than the exceptional items recorded in the quarter ended June 30, 2008. "Many of our competitors are guiding increased losses and declining traffic or in some cases, such as Aer Lingus, have refused to give any guidance at all. Ryanair will be the only major European airline to deliver passenger and profit growth in the current year," CEO Michael O'Leary claimed.

First-quarter revenue dipped 0.3% year-over-year to €774.7 million as operating expenses decreased 19% to €620 million owing to a 42% plunge in Ryanair's fuel bill as a result of its enhanced hedging program (ATWOnline, Jan. 8). Underlying operating profit came in at €154.7 million, a substantial improvement on last year's €19 million.

"Thanks to a 13% reduction in average fares, we grew traffic by 11%, which was a robust performance in a deep recession when many of our competitors were cutting flights, losing traffic and reporting increased losses," O'Leary said. "Our net profit margin rose to an industry-leading 18% and our balance sheet was strengthened as cash balances rose to €2.5 billion at the quarter end."

The LCC carried 16.6 million passengers during the quarter and said it remains on track to deliver full-year traffic growth of 15% to 67 million. "We continue to see enormous opportunities to grow our business," O'Leary said, adding that the airline is "besieged by many European airports who realize that Ryanair is their only credible partner if they wish to reverse recent traffic declines or to deliver growth."

At the end of this month the carrier will operate 199 737-800s to 147 destinations. It has 113 aircraft on order scheduled for delivery over the next three years.

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