Europe’s largest ultra-low-cost carrier Ryanair has announced a positive improvement in its financial performance for the past year.
This is especially impressive considering the fact that the aviation industry and commercial flying continue to suffer from pandemic-related repercussions. But this is also the reason why Ryanair is opting to take a cautious approach towards the rest of its recovery.
Onwards and Upwards
While the Dublin-based carrier still reported a loss, the losses are reducing.
The carrier shared a smaller than expected loss of $393 million for the financial year ending March 31st, 2022 (2021/22). Compared to the $1.05 billion loss it made the previous year (2020/21), this is more than promising.
The carrier made some positive gains elsewhere too. 97.1 million passengers flew with Ryanair in the last financial year compared to 27.5 million in the previous disruptive year. Ryanair expects to carry 165 million passengers this year in order to match pre-pandemic levels. This will be helped by the increased demand expected during the summer season and beyond as the globe recovers from the pandemic.
Total revenues for Ryanair tripped to $5.28 billion from 1.76 billion last financial year. $2.92 billion of which is exclusively from passenger revenues (compared to $1.14 billion in 2020/21).
Ryanair expects to return to “reasonable” profitability by 2023. But the carrier has warned that recovery remains “fragile” across the sector. It is likely that in order to continue to attract customers, fares will have to be set lower than usual, especially to encourage individuals to book closer to the travel date. The incentive to do so has dropped significantly in the wake of the pandemic, making it a rather unreliable and uncertain decision.
When announcing the latest financial statistics for Ryanair Holdings plc (which runs Ryanair, Ryanair UK, Lauda, Buzz, and Malta Air), Chief Executive Officer Michael O’Leary said:
“There is no doubt that traffic is recovering. We have seen in recent months stronger traffic and higher load factors, but most of that has been driven by lower fares. In the current first quarter, fares will be below 2019 levels. There is a prospect that fares in the September quarter could be ahead of 2019, but that recovery is fragile and could be severely damaged by negative news flows. But we expect Ryanair to grow faster in a recession, as has happened before after 9/11, the Gulf war, and previous economic crises.”
So while the carrier is sharing some positive stats, they see the importance of keeping it real. For example, Ryanair also shared how the Omicron variant in December and the Russian invasion of Ukraine “immediately” negatively impacted bookings for the Christmas and Easter period (despite the images of long queues and delays hitting UK airports over the summer). The carrier also expected overall capacity to be down 10 – 15% across the highly anticipated summer season.
When speaking on Ryanair’s forecasts for this summer’s busy season, O’Leary said:
“For the September quarter at the moment, based on about 50% of all bookings, we expect prices will be up by high single-digit % figures. It seems to us that there will be higher prices into that peak summer period because there’s so much demand for the beaches of Europe, and those price rises are going to continue.”
What do you think of Ryanair’s progress? Will you be flying with them this summer? Let us know in the comments below.