How can Ryanair offer flights for a penny?
Besides @Sebass van Boxel's answer, I'd like to add the following:

I was talking to a Fastjet pilot (ex easyJet) and he was telling me that obviously not all seats are available for a cheap price.

If you book early you will get a special price but try booking a day before and you will see.

As has been said, a lot of money is made on all the extra services such as luggage, food, etc.

From what he told me, the profit on each flight for easyJet is minimum \$400 per flight at 96% full &mdash; which is not much, but consider that easyJet has something like 1,000 flights a day and that means \$400,000/day profit. Not bad...

That how the money is made.