Ryanair ticket fares to rise over winter

Ryanair’s (RYA.IR) average fare rose by 24% to €58 (£50) and is set to increase over winter as the airline reported record profits and its first ever dividend.

The low budget carrier warned of further steep hikes as restrained air capacity across Europe and engine repair woes for some of its rivals will keep average fares firmly in double digits this winter.

The company expects a “mid-teens percentage” rise in average fares over the final three months of 2023.

Ryanair recorded a total revenue of €8.58bn (£7.43bn) in the six months to the end of September.

"We're pleased to report strong half year results... due to a very strong Easter [and] record summer traffic," said Ryanair's group chief executive Michael O'Leary.

Read more: Behind the brand: Caxton, the pioneering payment and foreign exchange firm

The Dublin-based carrier has been helped by a 24% rise in average air fares to about €58 in the six months to the end of September, as the post-pandemic boom in demand for international travel helped Europe’s largest airline.

It flew 11% more passengers at 105.4 million over its first half, with the group hailing its highest ever passenger numbers over the peak summer months.

The Irish airline’s profits reached €2.18bn over the six months, 59% better than its previous record for the period, set last year.

As a result, for the first time ever Ryanair is paying dividends to its shareholders. Investors are in line to receive €0.35 (£0.30) per share, part of an overall pay out of €400m (£346.6m) to be issued in February and September next year.

The dividend policy is a "strong vote of confidence in the company", Ryanair's chief financial officer Neil Sorahan said.

Read more: Trending tickers: Berkshire Hathaway | Ryanair | Novo Nordisk | Tesla

He added that in subsequent years Ryanair will return approximately 25% of the after-tax profit via an ordinary dividend.

Shares were up by over 6% after the company announced its first ever dividend.

The carrier also noted that forward bookings were robust heading into the peak Christmas travel period.

The group said it expects full-year earnings to rise by up to 30%, forecasting after tax profits of between €1.85bn (£1.6bn) to €2.05bn (£1.78bn), up from €1.43bn (£1.24bn) in 2022-23.

Watch: Ryanair sees record annual profit as fares soar

Download the Yahoo Finance app, available for Apple and Android.