RYANAIR Holdings Plc Chief Executive Officer Michael O'Leary predicted Europe's biggest discount airline will stay profitable this year as he increases ticket prices and baggage charges to make up for record oil costs.

Ryanair rose the most in two months in Dublin trading after O'Leary said average fares will climb 5 percent, reversing a 1-percent decline last year, Bloomberg News reported. Ryanair is eliminating call-center jobs, freezing salaries and boosting check-in fees as higher fuel bills cause the industry's worst losses since 2003.

Ryanair "will be the most resilient during a consumer recession and may even benefit from value-conscience consumers moving to the cheapest price," said Ross McEvoy, an analyst at Bloxham Stockbrokers in Dublin.

The carrier, whose shares are down 38 percent this year, had its first quarterly loss since 2004 yesterday after writing down a stake in Irish competitor Aer Lingus Plc.

At least a dozen airlines have failed in the past six months as surging oil prices that reached US$135 a barrel combine with slowing economies. In contrast, O'Leary is adding routes to France, Morocco and Romania.