By Anthony O. Goriainoff

 

Ryanair Holdings PLC said Monday that it expects the U.K.'s current "pingdemic" to lead to more uncertainty and that it will counteract this with more price stimulation and lower fares in the near term.

The "pingdemic" refers to people being notified by the U.K. National Health Service's Covid-19 app that they need to self-isolate for a set amount of time after it registers users have been in close contact with someone who has tested positive for the coronavirus.

Neil Sorahan, Ryanair's chief financial officer, said in an interview that although he expects passengers to continue making bookings closer to the departure date over the summer period and into the fourth quarter, this would start to change as the level of vaccination increases.

"We have raised our traffic guidance for the year as we are more comfortable now with the increased level of vaccinations, and people feel more confident to travel, especially in the U.K. where we've seen a pick-up in bookings," Mr. Sorahan said.

The London-listed low-cost carrier said it raised its traffic forecast for the fiscal year to a range of 90 million to 100 million passengers, from its previous guidance for the lower end of 80 million to 120 million. It added that the likely outcome for the fiscal year would be somewhere between a small loss and breakeven, though this was dependent on the continued rollout of vaccines this summer and no adverse Covid-19 developments.

The budget airline said traffic recovered significantly in the first quarter ended June 30, to 8.1 million passengers from 500,000 a year earlier. The company said it had achieved this by drawing in travelers with lower fares, as most flights in the Easter period--traditionally its strongest contributor in the quarter--were canceled because of "the delayed relaxation of government travel restrictions across the EU and the U.K. into May and June."

Mr. Sorahan said the company expects traffic of nine million passengers for July, and 10 million in August and in September. Traffic is expected to be around 38 million to 39 million passengers by the end of the first half, he said.

Ryanair said its first-quarter net loss was 272.6 million euros ($320.9 million), compared with a net loss of EUR185.1 million a year earlier.

Revenue was EUR370.5 million, compared with EUR125.2 million, it said. Ryanair said ancillary revenue rose to EUR178.6 million from EUR24.5 million a year earlier.

"With the booking curve remaining very close-in and fares well below pre-Covid-19 levels, visibility for the remainder of fiscal 2022 is close to zero. It therefore remains impossible to provide meaningful fiscal 2022 guidance at this time," the company said.

 

Write to Anthony O. Goriainoff at anthony.orunagoriainoff@dowjones.com

 

(END) Dow Jones Newswires

July 26, 2021 02:59 ET (06:59 GMT)

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