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Ryanair’s ‘rebranding’ fails to deliver

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RYANAIR – which flies from Liverpool and Manchester – said customer service was improving “rapidly” as the budget airline looks to recover from its first drop in annual profits in five years.

Post-tax profits were 8 per cent lower at £426.5m in the year to March 31 after a price war left average fares 4 per cent lower at a time of rising fuel costs.

Chief executive Michael O’Leary described the performance as disappointing but said efforts since September to reinvent Ryanair’s image and reputation helped passenger traffic rise 4 per cent in the second half of the year.

It has also seen better booking trends and fuller planes in the current year.

Changes have included the relaxation of bag restrictions for passengers, a reduction in baggage charges and an easing of booking conditions.

The airline, which operates more than 1,600 routes from 68 bases, has also moved to fully allocated seating on all flights, meaning that passengers who do not pay five euro (£4.10) to select their seats will be allocated them during the 24 hours before the date of departure.

Ryanair made revenues of 1.25 billion euro (£1bn) from ‘extras’ such as reserved seating and higher administration and credit card fees.

This was a rise of 17 per cent on a year earlier and accounted for 25 per cent of all sales in the year.

Fuel and oil costs increased by 7 per cent to two billion euro (£1.6bn) due to higher euro fuel prices and increased flying time.

Staff costs rose by six per cent to 463.6 million euro (£378m), partly after a 2 per cent pay increase granted in April 2013.

The airline also rolled out a new website last November, cutting the number of clicks involved in the booking process from 17 to five.

 

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