Ryanair increases profit forecast

Ryanair has raised its full-year profit forecast but warned that fares would have to rise to meet lo

The low-cost airline has increased its profit expectations to €275m (£240m), while reporting an £11m loss in the third quarter.

Ryanair saw a rise in the number of passengers to 16 million, an increase of 14 per cent until December. But the average fare declined by 12 per cent, largely due to price cuts. A 37 per cent fall in fuel costs had offset the cut in fares to a large extent.

The Ireland-based carrier said it expects to do well in the Italian, Scandinavian, Spanish and UK markets.

Michael O'Leary, Ryanair chief executive, said: "Market conditions remain difficult, although the increasing pace of consolidation and closures among our competitors, allied to Ryanair's continuing fleet expansion, will lead to further market share gains this year," he said.

The forecast helped raise the price of Ryanair shares by almost 5 per cent.