Budget airline Ryanair posted record profits today despite soaring fuel costs, and reiterated its desire to buy Irish rival Aer Lingus for £1 billion.
Ryanair said profits for the six months to September 30 lifted 39 per cent to 329 million euros (£220 million) as the number of passengers it carried jumped from 18 million to 22.1 million.
Chief executive Michael O'Leary said he now expected Ryanair to make profits of 350 million euros (£234.1 million) this year compared with earlier forecasts of 335 million euros (£224.1 million).
The upbeat message came despite a 42 per cent rise in the cost of fuel in the first half to 337 million euros (£225.4 million).
And Mr O'Leary said his strongly opposed £1 billion offer for Aer Lingus would create a "strong Irish airline group" able to compete with Europe's largest carriers and offer customers lower fares.
Mr O'Leary said: "Ryanair has again delivered record half-year profits despite intense competition and very high fuel prices.
"The Ryanair lowest fare model has repeatedly proven that it can generate increased profitability and significant passenger growth during difficult trading conditions while many of our competitors are struggling to deliver profits or are losing money."
He said fuel surcharges imposed on passengers by rivals increased the gap between "their high fares and Ryanair's lowest fares" during the first half.
"Our unwavering determination to avoid fuel surcharges has enabled us to deliver rapid traffic growth and generate higher profits," he added.
Ryanair also benefited from a 27 per cent rise in ancillary revenues including food, drink and hotels.
Despite raising its profits growth expectations from 11 per cent to 16 per cent for the full year, Ryanair said it remained "cautious" in its outlook for the second half as it faced "significantly higher oil prices " than a year ago.
Mr O'Leary shocked the airline industry last month with a £1 billion takeover bid for newly-privatised rival Aer Lingus.
Ryanair has now acquired a 19.2 per cent stake in Aer Lingus although a full takeover has met stiff opposition from the Aer Lingus board, its staff and the Irish government.
Just last week, Aer Lingus said the "derisory" takeover offer was "ill-conceived, contradictory and anti-competitive".
But Mr O'Leary said today: "We believe the combination of Aer Lingus and Ryanair into one strong Irish airline group will be rewarding for consumers and will enable us both to vigorously compete with the mega-carriers in Europe."
He added: "If our offer is not accepted by a majority of Aer Lingus shareholders, we will continue to be a significant minority shareholder and will exercise whatever influence we can to encourage Aer Lingus to reduce costs and offer lower fares which is, we believe, its best strategy for the future."
Mr O'Leary called again for the break-up of the BAA "monopoly" on London's main airports, Heathrow, Gatwick and Stansted.
"Until there is competition between the three London airports, airport charges will continue to rise and passengers will have to suffer these over specified, inefficient facilities," he said.Reuse content