Ryanair raised its full-year profit forecast after reporting a better-than-expected 152 percent surge in first quarter net income. It comes as rivals have cut their profit guidance. As Hayley Platt reports, the Irish budget airline says it's got a boost from its drive to improve customer service.
Ryanair's move to adopt a more 'touchy feely' image seems to be paying off. Profits in the first quarter more than doubled to 197 million euros, and a jump of 152% from a year earlier. It's largely thanks to an early Easter, which turned out to be better-than-expected. IG's Alastair McCaig. SOUNDBITE: Alastair McCaig, Market analyst, IG, saying (English): "Their figures are pretty impressive, surprisingly so the fact that Mr O'Leary is saying no over exuberance should be obtained on the back of this, in itself is slightly surprising that the whole statement and the whole set of figures has really taken the market by surprise." The stock rose more than 5 percent on opening. And shareholders should be further cheered as Ryanair plans to return 520 million euros to them through a special dividend later in the year. As the Irish budget carrier is boosting its annual profit guidance, some of its rivals are cutting theirs. IG's Alastair McCaig SOUNDBITE: Alastair McCaig, Market analyst, IG, saying (English): "The likes of KLM and Lufthansa are really struggling, profits warnings coming out from them and you've got to imagine that Ryanair are picking up some of the slack being seen there." Europe's biggest budget airline's pledge last year to improve services is well underway. Customers can now pre-book their seats. Restrictions on hand luggage have been relaxed. And penalty charges cut. It says it will continue making changes. And although the company sees traffic growing 3 percent in the first half of the year, it also remains cautious about what it describes as the ongoing difficult economic environment.