Europe’s largest airline has reported an easing in annual losses but warned its return to profitability remains clouded by “fragile” demand, despite discounting fares to stimulate custom.
Ryanair said net losses for the year to the end of March came in at €355m (£302m), down from €1bn over the previous 12 months as it navigated the worst of the impact from the pandemic.
Yet it said it was impossible to accurately forecast anything beyond hoping for a return to “reasonable profitability” this year as the return to the skies was mired by the war in Ukraine and sharp rise in the cost of living across Europe.
It said it was also cautious about the potential for further COVID disruption next winter but it planned to grow its traffic to 165 million passengers this year, up from 97 million a year ago and a pre-pandemic record of 149 million.
Michael O’Leary, its chief executive, said that although bookings had improved in recent weeks, first-quarter pricing continued to need stimulation and he expressed doubts over optimistic noise coming from its competitors over passenger demand as the continent is gripped by surging inflation – damaging consumer budgets.
“It’s too fragile, there remains too many moving parts,” O’Leary said of the outlook while eyeing the pandemic and impact of Russia’s invasion.
“Given the continuing risk of adverse news flows on both these topics, it is impractical (if not impossible) to provide a sensible or accurate profit guidance range at this time”, he concluded.
Ryanair expressed confidence it would thrive if any of its markets dipped into recession, citing its lower cost base and ability to offer lower fares.
The airline reported a 27% drop in the cost of average fares but said they were now rising by single-digit percentages as pent-up demand had become evident for the key summer holiday season ahead.
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