Ryanair, Irish budget airline, recently announced that they have raised their long-term growth forecast up to 10%. The company said that they will be expecting to board 200 million passengers per year by 2024, which could secure more than 20% of shares for Europe’s market as competing companies continue to struggle with the pressure on the fares and decreasing costs.
According to recent reports made by Ryanair, it has carried 65 million passengers for the first half of the fiscal year. It has garnered a 12% gain compared to the previous year’s April-September report.
The company also mentioned that an estimated 119 million passengers are to be boarded for the year.
The Irish carrier’s July-September shares, which were usually the busiest months for the airline, saw an increase up to 2% at $2.7 billion. Its market share was reported to incline by 5.3% €13.42.
Just recently, Ryanair was also affected by Britain’s recent vote to exit the European Union as it reduced its expected UK growth from 12% to around 5% for 2017. In order to catch up on the recent Brexit crisis, Ryanair increased its number of seats and added larger airports to its schedule to attract more passengers. These measures were taken to be able to level with competing airlines. The cheaper tickets made by the Irish airline helped its passenger tally go up to 12% during the first half of the year to a record of 64.8 million. However, the recent economic uncertainty and rising prices are still casting doubtful outcomes for the company.
The continuing economic uncertainty and decreasing fare rates could actually help Ryanair grow, as the low-cost nature of the company could grab market shares by undercutting rivals.
“We have EU incumbents retrenching, restructuring… creating more and more opportunities for Ryanair, particularly in primary airports,” said Ryanair CEO Michael O’Leary. He then added “the second half of the year will be difficult in a weaker pricing environment, but we expect that with a huge cost advantage over every other carrier in Europe, Ryanair is well positioned to continue to grow slowly.”
In order to keep up with Brexit mayhem, Ryanair decided to tone down its UK currency exposure and turned its expansion to other European countries where other present carriers are retreating in the course of the declining fares.
O’Leary mentioned as well that he was comfortable with the forecast of profit after tax which was between €1.3 billion and €1.35 billion.
So far, the Irish carrier was able to outperform other airlines for the past months as the sector struggled to keep up with Britain’s decision to leave the European Union last July.
Ryanair added on its report that they would return an additional €550 million to the shareholders by February in a share buyback. This move helped the company increase its shares to 6pc recently.
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