• Dublin-based Ryanair said full-year profit after tax jumped 34% and announced a 700 million-euro share buyback program.
• Higher traffic numbers and an increase in fares helped Ryanair overcome a spike in costs: operating costs were up 24% year on year, and the airline's jet fuel bill soared 32%.
• Ryanair Chief Financial Officer Neil Sorahan told CNBC's "Squawk Box Europe" Monday that its share buyback reflected a "very strong" balance sheet.

Low-cost carrier Ryanair on Monday reported its best-ever annual profit, as passenger and revenue growth offset sharply higher operating costs, but flagged a weaker pricing environment in the current quarter.

The Dublin-based company said profit after tax in the full year to March 2024 jumped 34% to 1.92 billion euros ($2.09 billion), while revenue rose 25% year on year to 13.44 billion euros.

The airline served 184 million passengers, 23% more than before the Covid pandemic. Higher traffic numbers and an increase in fares helped Ryanair overcome a spike in costs: operating costs were up 24% year on year, and the airline's jet fuel bill soared 32%.

Ryanair also announced a 700 million-euro share buyback program, which Chief Financial Officer Neil Sorahan said reflected a "very strong" balance sheet.

"Our priorities have been very much: restore the pay for our people after Covid, bring in pay increases, pay down the debt," Sorahan told CNBC's "Squawk Box Europe."

"And we've been paying down bonds, we now have 1.4 billion in gross cash at the end of the last year, and that's why the board now have the confidence on top of the ordinary dividend program, to actually return the 700 million to shareholders."

'Recessionary feel'

Ryanair's Dublin-listed shares were down 0.46% in midmorning trade, with analysts at Deutsche Bank highlighting that recent pricing had been softer than expected.

"While the buyback is good news and shows confidence, and while [full year] '24 is broadly in-line with most parts of [full year] '25 guide as expected, we fear the further softening of the pricing commentary for peak summer may win the day," the analysts said in a note.

The level of the buyback may also be below some expectations, they added.

In an investor presentation Monday, Ryanair CEO Michael O'Leary said softer pricing may be due to a "recessionary feel" in Europe or weaker consumer sentiment, Reuters reported.

"If we have to discount or cut fares to fill to 94% load factor in April, May and June then so be it," he added, according to Reuters. Load factor refers to the percentage of available seats filled, and came in at 94% for Ryanair's full year to 2024.

Pricing over the year was impacted by the sudden withdrawal of Ryanair flights from numerous online travel agents, or OTAs, in December.

Sorahan told CNBC the move was "surprising but not unwelcome," adding that Ryanair had now signed fresh agreements with several large OTAs. He said a positive was that Ryanair was now dealing directly with more customers rather than through third parties.

Other challenges for Ryanair include the ongoing delay to deliveries of its new Boeing aircraft, and the grounding of numerous Airbus aircraft due to engine issues.

"Capacity is going to be constrained for some time to come," Sorahan said.