Ryanair warns over higher air fares as value soars by €1bn
Published 20/05/2014 | 02:30
RYANAIR has warned customers to expect higher air fares next winter, driven by stronger demand.
Shares in Ryanair soared yesterday, boosting the Irish airline's value by almost €1bn, despite the company announcing its first fall in profits for five years.
Bookings for this summer are up – and the company said it forecast a return to profit growth in the year ahead. Ryanair outlined its plans to chase more business travellers as part of a strategy to boost passenger numbers by almost three million.
Michael O'Leary's new customer-friendly style includes allocated seating and a revamped website designed to appeal to older people and groups as well as business passengers.
The airline aims to fly 84.6 million passengers this year, it said as it announced financial results. But average fares will climb by as much as 2pc over the coming year, after falling in the past 12 months, Ryanair said.
Fare hikes are bad news for customers but investors lapped up the news. Shares saw the biggest gains in more than five years. The 10.6pc share price rise boosted the market value of Ryanair by almost €1bn in just one day's trading to €10bn.