LONDON -- Shares of Ryanair dropped 0.10 euros, or 2%, to 5.40 euros during early London trading this morning, even as the Irish airline revealed that its third-quarter profits had soared 21%.
Ryanair, which claims to be "Europe's only ultra-low cost carrier," said earnings had increased from 14.9 million euros to 18.1 million euros during October, November, and December. A 3% gain in passenger numbers to 17.3 million and an 8% rise in the average fare price helped revenues advance 15% to 969 million euros.
The third-quarter performance ensured Ryanair's nine-month results showed turnover up 15% to 4,075 million euros and earnings up 10% to 614 million euros.
Ryanair's chief executive, Michael O'Leary, said:
"Our Q3 profit of 18 million euros was ahead of expectations due to strong pre-Christmas bookings at higher yields. The 8% rise in average fares reflects our improved customer service, record punctuality, and the successful rollout of our reserved seating service."
Ryanair claimed this morning that its "industry-leading" customer service ensured 93% of its flights arrive on time, less than four flights in every 1,000 are cancelled, and less than one per 3,000 passengers report a lost bag.
The airline also said a survey of 10,000 passengers during December indicated that 83% were "satisfied or very satisfied" with their flight and that 95% said "Ryanair provides excellent value for money."
Ryanair's happy passengers prompted the airline to lift its full-year earnings guidance from 505 million euros to 540 million euros, equivalent to about 0.37 euros per share. The revised projection now values the airline at 14.6 times current-year profits.
Of course, whether Ryanair's positive third quarter, its current 8 billion euro market cap, and its "industry-leading" customer service now combine to make the share a buy is up to you.
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The article Ryanair Profits Soar 21% originally appeared on Fool.com.
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