Italy’s price cap on flights to Sicily and Sardinia is “illegal and unenforceable”, Ryanair group CEO Michael O’Leary told Reuters on Tuesday, adding the budget airline had lodged a complaint with the European Commission.
25.08.2023 - 14:38 / skift.com / Summer Travel / Wizz Air / Michael Oleary
Ryanair on Monday posted its largest ever after-tax profit for its key summer season and said it expected very strong passenger and fare growth for years to come as customers switch from higher-cost rivals.
But it also warned Europe’s recovery remained susceptible to shocks from Covid-19 and Russia’s invasion of Ukraine, and said aircraft delivery delays from Boeing could hit its capacity next summer.
The Irish airline, Europe’s largest by passenger numbers, earned 1.371 billion euros ($1.36 billion) in the six months to the end of September, the first half of its financial year.
While that was just short of a forecast of 1.385 billion in a company poll of analysts, it was well ahead of its previous first-half record of 1.29 billion euros in 2017. Ryanair’s shares were up 3.5 percent at 0925 GMT.
“Concerns about the impact of recession and rising consumer price inflation on Ryanair’s business model have been greatly exaggerated,” Chief Executive Michael O’Leary said.
“We expect these strong fundamentals will continue to underpin robust traffic and average fare growth for the next 18-months at least,” he said. Profit and traffic are poised for “very strong growth” until 2025 assuming oil prices remain relatively stable, he added in a video presentation.
A loss-making winter, during which Ryanair hopes to boost traffic 10 percent above pre-Covid levels, is likely to leave the airline with an after-tax profit of between 1 billion and 1.2 billion euros for the year to March 31, it said.
That forecast is “slightly tentative” considering most analysts were forecasting 1.2 billion euros, said Liberum analyst Gerald Khoo, who said in a note that he remained cautious on next year due to recessionary risks.
O’Leary said the July-September quarter had delivered growth on a scale he had never seen, with 15 percent traffic growth combined with a fare rise of 14 percent thanks to the combination of pent-up demand and the post-Covid retrenchment of rivals.
Bookings in November and December remain strong but there is little visibility for the first three months of 2023, he said.
Several rivals have provided upbeat guidance in recent weeks with Wizz Air, British Airways-owner IAG and Lufthansa all saying they were seeing continued strength in ticket sales despite inflation fears.
Chief Financial Officer Neil Sorahan said Ryanair expected “significant consolidation and some airlines failures” over the next 3-4 years and O’Leary said Ryanair could be left as the only major low-cost carrier in Europe.
Ryanair plans to grow from 168 million passengers this financial year to 185 million next.
However, while the airline is planning for the deliver of 51 737 MAX aircraft by next summer, O’Leary said he was concerned Boeing
Italy’s price cap on flights to Sicily and Sardinia is “illegal and unenforceable”, Ryanair group CEO Michael O’Leary told Reuters on Tuesday, adding the budget airline had lodged a complaint with the European Commission.
The CEO of bankrupt Scandinavian airline SAS, Anko Van der Werff, does not see the carrier’s position in the northern European market as “diminished” by recent market share grabs from the likes of Norwegian Air and Ryanair.
Copenhagen becomes Ryanair’s 2nd Danish base in addition to Billund. Ryanair’s winter ’23 schedule to/from Copenhagen offers 24 routes, with 4 exciting new destinations to Dusseldorf, Faro, Paris and Warsaw, and increased frequencies to Gdansk and Krakow.
Belgium-based Ryanair pilots will strike once again on 14 and 15 August.
Good morning from Skift. It’s Thursday, November 3. Here’s what you need to know about the business of travel today.
The Walt Disney Corporation announced on Tuesday during its fourth quarter earnings call that its theme park division generated $7.42 billion worth of revenue, a division record and a 36 percent increase from the same period last year.
Saudi Arabia’s increasing focus in the tourism sector and the shift to leisure travel has brought Seera Group from the red to report the company’s first post-pandemic operating profit of $8 million in the third quarter.
Registering a record performance for the first six months of the financial year, Dubai state carrier Emirates Airline on Thursday reported a net profit of $1.08 billion for the first half of the financial year, compared to a loss of $1.6 billion for the same period last year.
Australia’s Qantas Airways Ltd raised its first-half pre-tax profit outlook on Wednesday on strong travel demand, with limits on international capacity helping boost domestic tourism, sending its shares to more than a two-year high.
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Ryanair has aggressively battled online travel agencies over the years, seeking to bar them from selling its flights, and recently was dealt setbacks in separate litigation against Lastminute.com in Switzerland and Booking.com in the U.S.
Ryanair will likely trim some flights in August due to delivery delays from Boeing but there will be no material impact on customers, senior executive Eddie Wilson said in an interview on Tuesday.