Aircraft in Air
Ryanair, Europe’s low-cost and low-fare champion, has seen its FY2019 profit drop by 29 percent thanks to… low fares. The Irish LCC announced a EUR 1.02bln profit on May 20, compared to EUR 1.45bln for FY2018.
Ryanair at 139.1 million flew 7 percent more passengers, yet they paid on average 6 percent less for their tickets. The average ticket price has now dropped to EUR 37. Total revenues grew 6 percent to EUR 7.56bln.
The airline is expecting this trend of lower fares to continue in its fiscal year 2020, resulting in a further drop of its net profit to 750-950mln, despite a further increase in passenger numbers by 8 percent to 153 million. This should make Ryanair the biggest European airline again after it lost its top position to Lufthansa Group. Interestingly, Ryanair says it has ‘zero visibility’ on its HY2 bookings, except expecting to pay EUR 460mln for fuel and fares to drop further.
Ryanair had hoped to start operating the first Boeing 737 MAX 200 this Spring, but the grounding has caused deferral of the first five deliveries until hopefully November abd 42 more until next Summer. The LCC expressed ‘utmost confidence’ in the MAX with 16 percent better fuel efficiency over the 737NG, of which of the oldest will be sold. Full benefits of the MAX are to be expected for FY21. Ryanair counts on Boeing to cover lost profits resulting from the delays.
Its Austrian low-cost subsidiary Lauda was fully integrated last December at a one-off charge of EUR 139.1mln, almost identical to the airline’s contribution in revenues of EUR 142mln. Lauda flew 3 million passengers in its first year. It has now a fleet of 23 Airbus A320s, which will grow to 35 next year.
