RYAAY Ryanair Holdings PLC

LONDON—Ryanair Holdings PLC on Monday announced a new €800 million ($867 million) share-repurchase program and said third-quarter net profit more than doubled despite sales weakness the airline suffered in the wake of the terror attacks in Paris last year.

Net profit was €102.7 million, compared with €48.9 million in the prior year, the Dublin-based budget airline said. Sales for Europe's largest discount carrier rose 17% to €1.33 billion in the three months ended in December, it said.

EasyJet PLC, Europe's No. 2 budget airline, last week said sales retreated after terror attacks in Paris and Egypt triggered a temporary bookings slump. Ryanair said the Paris attacks in November that killed 130 people and a subsequent security shutdown in Brussels led average fares in the period to decline 1%, having earlier projected them to be flat. Lower costs helped compensate for the negative development.

"I think it has worked its way out of the system," Neil Sorahan, the airline's chief financial officer said of the Paris impact.

The share-buyback program is due to start Feb. 5, Ryanair said, and is likely to run about nine months. It is the airline's single biggest share buyback program, Mr. Sorahan said in an interview, adding that the carrier will have returned in excess of €4 billion to shareholders over the past eight years.

Ryanair has undertaken a string of share buybacks or paid special dividends in recent years to reward investors. Last year it distributed €398 million in special shares to investors after selling its stake in Aer Lingus to International Consolidated Airlines Group SA.

The discount carrier also lifted its fourth-quarter passenger traffic forecast to 26% growth for the three-months period ending in March, up from a projected 22% increase. It now expects to transport 106 million passengers in the current financial year.

Even so, Ryanair stuck to its full-year earnings guidance that net profit should be toward the upper end of its €1.175 billion-to-€1.225 billion range.

The airline's long-term growth projections last year were already lifted to carrying 180 million passengers a year in the 2024 fiscal year, 20 million passengers more than it had previously forecast.

The carrier also said it had taken advantage of low fuel costs to start locking in prices into future years using financial instruments. Ryanair has now secured fuel prices for about 95% of next year's expected consumption at a cost that should deliver around €430 million in year-over-year savings.

Fuel hedges also are now in place for about 50% of consumption in the subsequent year, promising a further cut in the airline's fuel bill. Fuel prices at such levels could yield another €300 million in lower costs, Mr. Sorahan said.

The savings would be used to lower ticket prices as Ryanair continues a period of capacity expansion, it said. Ryanair expects the airfare environment to get more competitive as other Europe carriers also see fuel higher-price fuel hedges replaced with lower terms.

"We see pressure on pricing in the next number of months," Mr. Sorahan said.

Write to Robert Wall at robert.wall@wsj.com

(END) Dow Jones Newswires

February 01, 2016 02:05 ET (07:05 GMT)

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