Ryanair warns it may lose almost €1bn
The low-cost carrier has been hurt as European governments add to restrictions on travel
Ryanair warned it could slump to an annual loss of nearly €1bn and that it faced “the most challenging” period in its history as European governments restrict travel to control the spread of coronavirus.
Europe’s biggest low-cost carrier said on Monday that it expected a loss of between €850m and €950m in its current financial year, which runs to the end of March.
The near-term outlook remained uncertain, Ryanair added, due to “uncertain and constantly changing Covid-19 travel restrictions”, lockdowns and the timing of the rollout of vaccines across the EU.
“Covid-19 continues to wreak havoc across the industry,” the airline said. This financial year “will continue to be the most challenging year in Ryanair’s 35-year history”, it added.
Losses over the Christmas quarter rose to €306m, excluding exceptional items, after passenger numbers fell nearly 80 per cent to 35.9m. Revenue fell by a similar margin to €1.91bn.
Like all other large European airlines, Ryanair was forced to slash its flight schedules through the autumn as anticipated demand for travel failed to rebound.
The outlook has since darkened considerably, and European airlines are bracing themselves for a tough few months as governments try to stop people travelling to contain the spread of new variants of the virus.
EasyJet last week said it would fly just a 10th of its normal schedule in the first three months of this year.
With €3.5bn in cash available at the end of December, Ryanair has one of the strongest balance sheets and lowest costs in the industry. Michael O’Leary, its chief executive, is bullish that the carrier will eventually be able to use the disruption to grow at the expense of weaker rivals.
For now though, his airline is subject to the same challenges as competitors, and industry analysts warned there was a growing danger that there would be disruption to the crucial summer season.
“EU governments’ vaccine rollouts remain key to opening markets for the summer,” analysts at Davy Research said.