Ryanair says it is likely that its profits will break the €1 billion (£730 million) barrier for the first time this year, as Brits continue to take advantage of the weak euro.

Hitting the €1bn marker would mean a 25% rise on its initial forecasts. But the budget airline doesn't just expect to hit the mark, it believes it will smash it, forecasting profits of €1.18bn – €1.23bn in the financial year ending March 2016.

The news sent the airline's shares up 8.5% to an all-time high of €14.

A surprise spike in passenger numbers, the weakness of the euro, oil prices and bad weather in northern Europe all helped Ryanair to raise its expectations. Earlier this week, Ryanair's rival, EasyJet, also raised its profit forecasts for similar reasons.

The Irish firm recently transformed its service after years of "unnecessarily p*****g people off”, to quote chief executive Michael O'Leary. Ryanair introduced allocated seating, new seats with more leg room, improved in-flight meals, extra carry-on luggage and more business-friendly timetables. But Mr O'Leary said that, whilst the improvements have helped its profit outlook, they were not entirely to thank for.

Mr O’Leary said: “We have clearly benefited from favourable industry trends this summer including bad weather in northern Europe, stronger sterling encouraging more UK families to holiday in the Med, reasonably flat capacity across the EU industry and lower prices for our unhedged oil.

“Being the airline industry we do not expect these favourable conditions will persist, and we would urge shareholders and analysts to avoid irrational exuberance.”