Ryanair to overtake BA

RYANAIR, the Irish budget airline that has been predicting a bloodbath among its rivals in the European air travel industry, is turning positive and promising unexpected growth in passenger numbers which will see it overtake British Airways for the first time.

Buoyed by a better-than-expected winter, after chief executive Michael O'Leary had previously warned of falling passenger profits and a wave of airline collapses, Ryanair said today it will carry 35m passengers this year.

That is equal to growth of 27% when O'Leary had previously forecast annual increases would be around a fifth and compares with the 19% growth booked in the last year.

'Our outlook for the coming 12 months is more positive than it was this time last year,' he said. Moreover, it means the Irish airline, founded 20 years ago by the Ryan family, will from its UK and European operations outstrip the number of passengers carried by the whole of BA's short-haul and long-haul operations.

'We expect to overtake BA's monthly traffic later this summer,' said O'Leary. 'This is a significant milestone for a small Irish airline which only started flying in 1985 and means the world's favourite airline is being overtaken by the world's lowest price airline.

'Does it matter that we are bigger than BA? No. But it does show that the public is refusing to be conned into paying high prices for so-called superior service.'

In the year to 31 March Ryanair reported a 19% rise in net profits to €268m (£183m). That was pulled up by an unexpected 2% rise in fares charged by the airline.

O'Leary admitted he had been able to increase fares on the quiet as many other European airlines had raised theirs far faster by slapping on fuel surcharges.

Ryanair's revenues, up 24% at €1.33bn, were also helped by a 40% surge in ancillary revenues, cross-selling car hire, hotels and travel insurance to customers when they make their bookings.

That enabled the carrier to shrug off the worst effects of the soaring oil price which saw Ryanair's fuel costs rise by 52%, though much of that increase was also down to flying more services and to destinations - such as Eastern Europe - which are further away. The airline has hedged 75% of its fuel costs for next winter at $47 a barrel.