Ryanair reported its first quarterly profit since before the onset of Covid-19, but said it expects to post an annual loss of up to €200 million as it would be forced to discount tickets to fill its planes over the winter.
The airline, which operated more flights this summer than its European rivals, reported on Monday an after-tax loss of €48 million for the six months to September. A company poll of analysts had forecast a loss of €43 million.
While it did not break out its after-tax profit for the three months ended September, its second quarter, the €273 million loss it reported in the first quarter implies a second quarter profit of €225 million.
First profit since pandemic
That marks its first quarterly profit since October-December, 2019 - before the pandemic disrupted travel.
The budget airline, Europe's largest, carried 39.1 million passengers in the six months ended September, 54 per cent fewer than in the same period of 2019.
Chief executive Michael O’Leary said: “While sectors and traffic more than doubled, operating costs increased by just 63 per cent to €2.2 billion, driven primarily by lower variable costs such as aircraft, airport and handling, route charges and fuel.
“Lower costs, coupled with rising load factors, led to a marked reduction in cost per passenger (ex-fuel) to €38.
“We expect to see further improvements in costs as our new, lower-cost, more fuel-efficient aircraft deliver and EU countries (such as Ireland, Spain and Italy) roll out Covid recovery incentive schemes.”
Mr O’Leary added that the airline has seen a surge in bookings for the midterm and Christmas breaks, with the levels expected to remain high into next year.
But he warned that next year will remain challenging due to high fuel costs and “will be crucially dependent on the continued rollout of vaccines and no adverse Covid-19 developments”.
The boss also revealed that the company is mulling a delisting from the London Stock Exchange (LSE) in the wake of Brexit.
“Trading on the London Stock Exchange as a percentage of overall trading volume in Ryanair’s ordinary shares has reduced materially during 2021,” Mr O’Leary said.
“The migration away from the LSE is consistent with a general trend for trading in shares of EU corporates post-Brexit and is, potentially, more acute for Ryanair as a result of the longstanding prohibition on non-EU citizens purchasing Ryanair’s ordinary shares being extended to UK nationals following Brexit.
“The board of Ryanair is now considering the merits of retaining the standard listing on the LSE. Ryanair has a primary listing on the regulated market of Euronext Dublin, which offers shareholders the highest standard of protection.” -Reuters
(Additional reporting by PA)