Historically famous for being customer adverse, this protocol, seemingly led by outgoing CEO Michael O Leary was amazingly popular. The prospect of extremely cheap flights to destinations that would have normally been expensive with other carriers seem to be the main catalyst for Ryanair (LONDON:RYA)'s popularity.
However, the cracks in this model started to show over a year ago when various allegedly unfair customer service issues arose with regards to unfair costs of checked in luggage, the cost of changing the date of a flight or general use of its customer service.
In addition to this, rival budget airline Easyjet (LONDON:EZJ) started to introduce allocated seating and extra leg room with a strategy that seemed to resonate with better customer service. Since the start of 2014 the Ryanair brand has under gone transformation eliminating policies which were deemed unfair, allowing carry-on luggage and, to quote the eloquent Mr. O'Leary. “ to stop unnecessarily pissing people off.”
Figures released yesterday show this has been a huge success, with a full year net profit coming in at €750 million versus an expected €682 million from analysts.
In addition to these impressive set of figures, the stock seems to be in a perfect storm: Having technically broken out of a narrow band of resistance from €6.50 to €7.70 for the past year, the upward trend can now push on to at least €9.40.
Finally, as is always important to airlines, the cost of fuel has declined. WTI is down an amazing 17% alone this year, which should filter through to the next set of figures: a prefect storm for being long.
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