Ryanair Swung to Record Net Loss in Fiscal Year 2021; Sees Recovery Ahead -- Update
--Ryanair posts record loss for fiscal 2021 as traffic fell by
--The airline expects fiscal 2022 to be close to breakeven, but
says visibilty remains poor
--Ryanair expects strong travel rebound in 2H, and says recovery
has already begun
By Anthony O. Goriainoff
Ryanair Holdings PLC said Monday that it swung to a record net
loss in its latest fiscal year due to the coronavirus pandemic, but
that it expects fiscal 2022 to be close to breakeven.
The Irish low cost carrier said visibility for the rest of the
year ending in March 2022 is practically zero, and that although
bookings have jumped significantly from a very low base since the
first week of April, it is impossible to provide meaningful
guidance for the fiscal year.
Still, the airline said it expects to benefit from a strong
rebound of pent up travel demand through the second half of the
year and said it looks forward to returning to growth in summer
2022. The company said the recent strong increase in weekly
bookings since early April suggests a recovery has already
Ryanair said its financial strength will enable it to capitalize
on the many growth opportunities that will become available
post-pandemic, with analysts at Citi saying a combination of a
strong balance sheet--EUR3.15 billion in cash--and improved cost
metrics position the company for growth.
The company said it will benefit from a reduced fleet cost over
the next decade as it takes delivery of Boeing's 737 "gamechanger"
aircraft, which it believes will improve revenue with 4% more seats
while substantially reducing unit costs, especially fuel. This will
also be aided by its new bases, including those in Billund,
Stockholm and Zagreb, the company said.
The budget airline said it expects traffic in the first quarter
to be heavily curtailed to between 5 million and 6 million
For the year ended March 31, Ryanair's net loss was 1.02 billion
euros ($1.24 billion) compared with a profit of EUR648.7 million in
fiscal 2020 and consensus forecasts of a EUR1.04 billion loss,
taken from FactSet and based on 13 analysts' estimates.
The London-listed airline's news came as IAG also posted a
record loss for 2020 in February, both proof of the enduring impact
of the pandemic on Europe's aviation sector.
Adjusted loss after tax--a key measure for Ryanair--was EUR815.4
million compared with a profit after tax of EUR1.00 billion the
year before. In April the company said it expected an adjusted loss
of around EUR800 million to EUR850 million.
Ryanair's pretax loss for the year was EUR1.11 billion compared
with a profit of EUR670.3 million the year before.
Revenue was EUR1.64 billion compared with EUR8.49 billion a year
earlier. Consensus saw revenue at EUR1.63 billion, based on 21
analysts polled by FactSet. The company said this was in line with
the fall in traffic to just 27.5 million from 149 million
pre-pandemic. The result was helped by ancillary revenue as more
guests chose priority boarding and reserved seating, which resulted
in an 11% increase in spend per passenger to almost EUR22.
The load factor--a measure of how full a plane is--for the year
was 71%, compared with a load factor of 95% for fiscal 2020.
"If, as is presently predicted, most European populations are
vaccinated by September then we believe that we can look forward to
a strong recovery in air travel, jobs and tourism in the second
half of the current fiscal year," the company said.
Shares at 0740 GMT were up 2% at EUR17.18.
Write to Anthony O. Goriainoff at
(END) Dow Jones Newswires
May 17, 2021 04:33 ET (08:33 GMT)
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