Ryanair, Europe’s No.1 airline, today (08 June) welcomed the recent ruling of the Barcelona Court of Appeal regarding the damage caused by Online Travel Agents (OTAs) to Ryanair and our customers. OTAs have no commercial agreements with Ryanair and are not authorised by Ryanair to sell our flights.

The Court affirmed the first instance decision which rejected ACAVE’s (a Spanish travel agencies association) criminal complaint against Ryanair and found that Ryanair’s statements on OTA’s damaging practices are true and supported by extensive documentary evidence. Specifically, the Courts found that it is standard practice for OTAs to overcharge customers by applying ‘service charges’, and that some OTAs frustrate Ryanair’s direct communications with customers and block refund payments by not providing Ryanair with the customer’s correct details.

Ryanair’s Dara Brady said:

“We welcome this Court ruling which definitely upholds Ryanair’s right to raise awareness about the damage OTAs cause to Ryanair’s image and Ryanair’s customers by overcharging them, frustrating our ability to contact them directly with important flight updates and blocking refunds they are entitled to.

We encourage all customers to book their flights directly on the Ryanair website or app to access the lowest fares and direct customer services. Customers should look out for the Ryanair Verified Seal to ensure they are booking directly with Ryanair and getting the best value and service.”

CALL ON URSULA VON DER LEYEN TO TAKE ACTION AND PROTECT EU OVERFLIGHTS DURING REPEATED ATC STRIKES

Ryanair, Europe’s No. 1 airline, has today (5^th June) called on the EU Commission under Ursula von der Leyen to take urgent action to protect overflights and EU citizens’ freedom of movement during the French ATC strike taking place today, Mon 5^th and tomorrow, Tues 6^th June.

In the past 5 months of 2023, there has been 58 days of ATC strikes (over 11 times more than in 2022). These repeated ATC strikes have unfairly forced airlines to disproportionately cancel thousands of EU overflights from Germany, Spain, Italy, the UK and Ireland while France in particular, uses Minimum Service Laws to protect their domestic/short-haul flights while cancelling overflights. This is unfair. France (and all other EU states) should use Minimum Service Laws to protect overflights during ATC strikes as they do in Greece, Italy and Spain.

Last week, Ryanair delivered its ‘Protect Overflights: Keep EU Skies Open’ petition to EU Commission President, Ursula von der Leyen’s office, having collected more than 1.1 million signatures from fed-up passengers demanding that the EU Commission protect overflights and EU citizens’ freedom of movement during repeated ATC strikes. Despite this, EU Commission President, Ursula von der Leyen, has unsurprisingly done nothing to protect these passengers as hundreds more EU overflights are cancelled again due to the French ATC strike taking place today and tomorrow.

We call on the EU Commission, under Ursula von der Leyen to:

– Respect the strike rights of ATC unions, but

– Protect 100% of overflights (like Greece, Italy & Spain) during national ATC strikes

– If ATC strikes require cancellations, then allocate these to domestic/short-haul flights to/from the affected State

– Enforce binding arbitration for ATC disputes before strike action

– Require a 21-day notice of strike action

– Require a 72h notice of employee participation in ATC strikes to minimise passenger disruption

A Ryanair spokesperson said:

“Last week, Ryanair delivered our ‘Protect Overflights: Keep EU Skies Open’ petition to EU Commission President, Ursula von der Leyen’s office, having collected more than 1.1 million signatures from fed-up passengers demanding that the EU Commission protect overflights and EU citizens’ freedom of movement during repeated ATC strikes.

It is utterly unacceptable that Ursula von der Leyen is ignoring these more than 1.1 million passengers, who are sick and tired of having their overflights cancelled at short notice due to repeated ATC strikes. As a result, hundreds more overflights are being disproportionately cancelled by yet another French ATC strike taking place today, 5^th and tomorrow, 6^th June.

It is completely impermissible that ATC strikes can result in the cancellation of thousands of EU passengers’ flights, while France and other EU Member States use Minimum Service Laws to protect their domestic flights. If ATC unions insist on striking, which is their right, then they should cancel flights to/from the affected State and protect overflights, not cancel EU overflights from Germany, Spain, Italy, the UK.

The EU Commission must now take urgent action and insist that all States protect overflights during ATC strikes as is already done in Greece, Italy and Spain.”

    Ryanair Holdings plc today (Fri, 2 Jun) released May 2023 traffic stats as follows:

Ryanair, Hungary’s No. 1 airline, today (1^st June) welcomes a ruling by the Metropolitan Court of Budapest, which annulled the bogus fine of €763,000 raised by the Hungarian CPA in August 2022 after Ryanair passed the Hungarian Govt’s “excess profit” tax of €10 per departing passenger to consumers. At the time, Ryanair condemned this “excess profit” tax when the main airlines in Hungary (including Ryanair) were reporting record Covid-related losses.

In a ruling last week, the Metropolitan Court of Budapest annulled this bogus fine, and confirmed that Ryanair could lawfully pass on this tax to consumers, and that Ryanair’s procedural rights had been “violated”. The Hungarian Court’s ruling is in line with EU law, which guarantees all airlines the freedom to set prices and pass on retrospective taxes to consumers.

Ryanair welcomes this ruling, which reverses this absurd and politically motivated fine.

Ryanair’s Chief Legal Officer, Juliusz Komorek, said:

“We welcome this ruling by the Hungarian Courts, which properly reflects EU law, which guarantees airlines the freedom to set prices and pass on retrospective taxes, even in cases such as this where there was no lawful basis for the Hungarian Govt’s bogus “excess profits” tax of €10 per departing passenger, at a time when all EU airlines were losing money due to Covid.

Ryanair believes that this Hungarian CPA fine was politically motivated, and calls on the Justice Minister, Judit Varga, to apologise for her Facebook post which welcomed the imposition of this politically motivated but bogus fine, which has now been annulled by the Hungarian Courts.

Ryanair continues to invest in Hungary, and continues to offer low fare air travel to/from Hungary for both Hungarian citizens and visitors. The clarity provided by this Hungarian Court ruling will help us to continue to invest in and grow our traffic in Hungary for the benefit of Hungarian citizens, their families, and the Hungarian tourism industry.”

“PROTECT OVERFLIGHTS – KEEP EU SKIES OPEN”

Ryanair, Europe’s No. 1 airline, today (31^st May) delivered its ‘Protect Overflights: Keep EU Skies Open’ petition to EU Commission President, Ursula von der Leyen’s office, having collected more than 1.1 million signatures from fed-up passengers demanding that the EU Commission protect overflights and EU citizens’ freedom of movement during repeated ATC strikes.

In the first 5 months of 2023, there have been 57 days of ATC strikes (10 times more than 2022) forcing airlines to disproportionately cancel thousands of EU overflights from Germany, Spain, Italy, the UK and Ireland while France in particular, uses Minimum Service Laws to protect their domestic/short-haul flights while disproportionately cancelling overflights. France (and all other EU states) should copy the example of Spain, Italy and Greece all of whom use Minimum Service Laws to protect overflights during ATC strikes. If this means that a greater number of domestic or short-haul flights are cancelled, then so be it, but flights over France must be protected during French ATC strikes.

Ryanair calls on the EU Commission led by Ursula von der Leyen to act on the petition of more than 1.1 million EU passengers, and demand that all EU States protect overflights during ATC strikes as is already done in Greece, Italy and Spain. We call on the EU Commission, under Ursula von der Leyen’s leadership to:

• Respect the strike rights of ATC unions, but
• Protect 100% of overflights (like Greece, Italy & Spain) during national ATC strikes
• If ATC strikes require cancellations, then allocate these to domestic/short-haul flights to/from the affected State
• Enforce binding arbitration for ATC disputes before strike action
• Require a 21-day notice of strike action
• Require a 72h notice of employee participation in ATC strikes to minimise passenger disruption

Ryanair’s Michael O’Leary said:

“Today, just 10 weeks since we launched our ‘Protect Overflights: Keep EU Skies Open’ petition, we delivered over 1.1 million signatures from fed-up EU citizens calling on the EU Commission under Ursula von der Leyen to protect overflights during repeated ATC strikes. It is unacceptable that ATC strikes can result in the cancellation of thousands of EU passengers’ flights, while France and other EU Member States use Minimum Service Laws to protect their domestic flights.

Europe’s passengers are sick and tired of suffering unnecessary overflight cancellations during ATC strikes. The EU Commission must now act upon the petition of more than 1.1 million EU citizens and insist that all states protect overflights during national ATC strikes as is already done in Greece, Italy and Spain.”

Ryanair, Italy’s No.1 airline, today (24 May) welcomed the EU General Court’s ruling on discriminatory State aid favouring Italian airlines over other EU airlines. The Italian government granted a €130m aid package only to airlines holding an operating licence issued by Italy.

While the Covid-19 crisis caused serious damage to all airlines, many national governments, including Italy, rushed through discriminatory subsidy schemes limited to their own former flag carriers, ignoring other airlines that contribute to the economy and the connectivity of the European Union. Ryanair is Italy’s largest airline yet was excluded by the Italian government from these schemes. Ryanair appealed the European Commission’s approval of these illegal subsidies to the EU General Court in 2021.

Today’s judgment, following on from the EU General Court’s recent annulments of the European Commission’s illegal clearances of a blockbuster €6bn aid package to Lufthansa and €1bn to SAS, are a victory for the EU internal market and are damning of the European Commission’s head-in-the-sand approach to massive and discriminatory bailouts of ailing flag carriers by EU Member States.

Ryanair’s spokesperson said:

“One of the EU’s greatest achievements is the creation of a single market for air transport. The European Commission’s approval of the aid scheme limited to airlines with an operating licence issued by the Italian State went against the fundamental principles of EU law. Today’s judgment confirms that the Commission must act as a guardian of the level playing field in air transport and cannot sign-off discriminatory State aid under political pressure by national governments. The Court’s intervention is a triumph for fair competition and consumers across the EU. 

During the Covid-19 pandemic over €40bn in discriminatory State subsidies has been gifted to EU flag carriers. Unless halted by the EU Courts in line with today’s ruling, this State aid spree will distort the market for decades to come.  Europe’s emergence from the Covid-19 crisis with a functioning single market depends on airlines being allowed to compete on a level playing field. Undistorted competition eliminates inefficiency and benefits consumers through low fares and choice. Unjustified subsidies, on the other hand, encourage ineffectiveness and will harm consumers for decades to come”.

Ryanair Holdings plc today (22 May) reported a Q4 loss of €154m but a full-year PAT of €1.43bn, compared to a PY loss of (€355m), due to strong FY traffic recovery, improving fares, industry leading cost base and advantageous fuel hedges.

Ryanair’s Michael O’Leary, said:

ENVIRONMENT:

“Passengers who switch to Ryanair (from EU legacy airlines) can reduce their emissions by up to 50% per flight.  Over the past year, we made significant progress to become net carbon neutral by 2050.  Our new, fuel efficient, B737 “Gamechangers” (4% more seats, but 16% less fuel) increased to 98 aircraft at year end, and we began to retrofit scimitar winglets on our B737NG fleet which will further cut fuel burn by 1.5%. 

We are working hard to achieve ambitious 2030 goals of powering 12.5% of Ryanair flights with SAF.  We have recently expanded our SAF partnerships with Neste (Schiphol), OMV (Austria, Germany and CEE) and Shell (in London and Dublin) by announcing a multi-year MOU with Repsol to supply Ryanair bases in Spain.  Through A4E, and the EU, we are campaigning to accelerate reform of European ATC to eliminate avoidable flight cancellations/delays (something urgent in light of repeated French ATC strikes in Q1), which will substantially lower fuel consumption and CO₂ emissions.   We urge all EU consumers to sign our “Protect Overflights” petition on www.ryanair.com.  

Ryanair is Europe’s No.1 ranked EU airline for ESG by Sustainalytics^[1].  During FY23, MSCI increased our ESG rating to ‘BBB’ (from ‘B’) and CDP reconfirmed Ryanair’s industry leading (‘B’) climate rating for 2023.

SOCIAL :

Ryanair’s commitment to maintaining jobs and keeping skills current through the 2-years Covid crisis, albeit with Govt. payroll support and temporary pay cut agreements with union partners (now restored, over 2 years sooner than planned), maximised our crew jobs security while our competitors cut thousands of jobs.  It also meant that Ryanair was fully staffed to operate its S.22 schedule, while many competitors cancelled capacity (often at short notice) in the face of severe staff shortages.  Following a strong H1 performance, Ryanair fully restored pay (some 28 months early) by agreement with our unions on new long-term multi-year pay agreements.

As Ryanair grows traffic to 225m p.a. by FY26 and 300m by FY34, our Group will create over 10,000 new jobs for highly paid pilots, cabin crew, and engineers.  Over the past year we recruited and trained over 3,000 new crew members (incl. 1,000 pilot cadets).  The Group opened new engineering facilities in Bergamo (Italy), Malta, Kaunas (Lith.) and Shannon (Ire.) and recently announced a €40m new Dublin maintenance centre (creating over 200 engineering jobs).  These new facilities and fleet growth enables us to create cadet positions and apprenticeships for school leavers, bringing through the next generation of highly skilled aviation professionals.  Ryanair Labs is actively recruiting IT & digital professionals to join our dev. teams in Dublin, Madrid, Porto and Wroclaw.

Ryanair’s strong S.22 operational resilience (despite multiple ATC delays/strikes, airport security/handling staff shortages) meant we delivered industry leading capacity recovery and OTP for our customers.  This was reflected in FY23’s CSAT score of over 85%, with “crew friendliness” our top score (rated over 95%).  This summer, in anticipation of further ATC disruptions, we have invested heavily in our operations (increased crew ratios, doubled the size of our ops centres, enhanced day-of-travel app. and we continue to improve  customer comms.) to ensure that our passengers and crews continue to enjoy Ryanair’s industry leading OTP and reliability.

GOVERNANCE:

In recent months, 3 new NEDs (Eamonn Brennan, Elisabeth Köstinger and Anne Nolan) have joined the Ryanair Board. Our Chairman (Stan McCarthy) has also refreshed our Board Committees.  Dick Milliken, having successfully overseen the rotation of external auditors (from KPMG to PwC) during FY23, has chosen not to seek re-election at the 2023 AGM in Sept.  To facilitate experienced management of the Group, orderly succession and the onboarding of new NEDs, Louise Phelan has agreed to remain on the Board for one more year.  Over the past year, Ryanair’s EU ownership has increased from 41% to 46% at year end.

GROWTH:

Ryanair’s market share has grown significantly in most EU markets as we operated 116% of our pre-Covid capacity in FY23.  Most notable gains were recorded in Italy (from 27% to 40%), Poland (26% to 36%) and Ireland (49% to 58%).  This summer we will operate our largest ever schedule (almost 2,500 routes with over 3,000 daily flights), capitalising on traffic restoration, and multi-year growth deals negotiated by our New Route teams.  Structural EU capacity reductions following numerous EU airline failures or fleet reductions during Covid, high oil prices (discouraging weaker, unhedged, airlines from adding capacity), a shortage of aircraft (new & leased) and the return of Asian and American visitors to Europe (due to the very strong US$) means that while S.23 European short-haul capacity remains below pre-Covid levels, demand is notably robust.  Forward bookings and air fares currently into S.23 are strong and we continue to urge all customers to book early to avoid rising “close-in” prices.

We expect European airlines will continue to consolidate over the next 2 years and it seems likely they will deploy capacity in a disciplined manner.  The large backlog of OEM aircraft deliveries is likely to constrain capacity growth in Europe for at least 4 more years which confers a considerable growth premium on Ryanair’s  remaining 110 B737 Gamechangers deliveries over the next 3 summers. Our widening unit cost advantage over all competitors, our fuel hedging, strong balance sheet and our very low-cost aircraft order book, as well as our proven operational resilience, creates enormous growth opportunities for Ryanair over the coming years. 

FY23 BUSINESS REVIEW:

Revenue & Costs:

FY23 scheduled revenue grew over 160% to €6.93bn.  Following a disappointing Q1 (when traffic was badly impacted by Russia’s invasion of Ukraine on 24 Feb. 2022), strong travel demand through the remainder of the year saw traffic rise 74% at higher fares (+10% on pre-Covid).  Ancillary sales delivered a solid performance, generating just under €23 per passenger (€3.84bn).  Total FY23 revenue rose 124% to €10.78bn.  Total operating costs rose 75% to €9.20bn, driven by higher fuel costs (+113% to €3.90bn, offset by favourable fuel hedges and improved fuel burn as more Gamechangers entered the fleet), crew pay restoration and 74% traffic growth.  Ex-fuel operating costs rose 54%, which was well below traffic growth, and unit costs (ex-fuel) were just €31 as Ryanair’s cost advantage over all other EU competitors widened substantially as we predicted it would.  Our industry leading fuel hedging (over 80% hedged at approx. $64bbl) contributed significantly to the final FY23 profit outcome, saving the Group over €1.4bn. 

FY24 jet fuel requirements are almost 85% hedged at approx. $89bbl (with a mix of forwards and caps) and 25% of H1 FY25 is covered at $77bbl.  Just over 90% of FY24 €/$ opex is hedged at 1.08 and 38% of H1 FY25 is covered at 1.11.  Our B-8200 “Gamechanger” order book is fully hedged at €/$ 1.24 which further lowers the cost of these new aircraft compared to many competitors who are engaged in expensive (and getting more expensive) leasing to grow their fleet even as interest rates are rising.

Balance Sheet & Liquidity:

Our balance sheet is one of the strongest in the industry with a BBB+ credit rating and €4.7bn gross cash at year-end, despite an €850m bond repayment in March 2023.  Almost all the Group’s B737 fleet are owned and 99% are unencumbered, which significantly widens our cost advantage, as interest rates and leasing costs continue to rise for competitors. Thanks to our strong booking recovery, improving air fares and Boeing delivery delays, net cash at 31 Mar. was €0.56bn (compared to net debt of €1.45bn at 31 Mar. 2022), despite over €1.9bn capex.  (Capex was c.€450m lower than expected due to Boeing delivery delays – now timed into FY24).  Earlier this month Ryanair converted its unsecured €750m syndicated term loan into a revolving credit facility (at a lower margin) with an extended maturity to May 2028 (was 2024).  Over the coming months we will repay a €750m maturing bond in Aug. and fund over €2.6bn capex (FY24 is the peak capex year under the “Gamechanger” order) while planning to retain a broadly flat net cash/debt position.  We will continue to preserve cash to minimise financing costs as we face considerable annual aircraft capex of over €2bn p.a. from 2027 onwards.

AIRCRAFT ORDERS:

Earlier this month, Ryanair signed an agreement to purchase 300 new Boeing 737-MAX-10 aircraft (150 firm and 150 options), which is subject to AGM approval on 14 Sept. next.  These, fuel efficient, aircraft have 228 seats (21% more than our B737NGs) and phased deliveries between 2027 and 2033.  We expect 50% of the order will be used to replace older NGs, while the remainder will facilitate disciplined traffic growth to approx. 300m p.a. by FY34 (an 80% increase over FY23’s traffic).  Apart from delivering significant revenue growth, the additional seats (coupled with greater fuel, carbon and noise efficiency) will further widen Ryanair’s considerable unit-cost advantage over all European competitor airlines.  Given the strength of the Group’s balance sheet, our strong credit ratings and the 2-year gap between the delivery of the final B-8200 “Gamechanger” in late Dec. 2024 and the first MAX-10 in early 2027, we anticipate that capex will be funded primarily from internal resources (although the Group will remain opportunistic in its financing decisions).

As a result of Boeing’s recent B737 delivery disruptions, we expect to be short (up to 10) B-8200s for peak (June & July) S.23 schedules.  To facilitate Boeing, and to assist their resumption of scheduled B-8200 deliveries this autumn, we will take delivery of aircraft through July (and possibly into Aug.).  We hope and expect that Boeing will recover quickly from this recent delay to minimise its impact on our FY24 traffic growth and profitability.       

OUTLOOK:

This year Ryanair hopes to grow traffic to approx. 185m (+10%), although Boeing’s recent delivery delays may push some of this growth into the lower yielding H2 and may reduce this target slightly.  Our FY24 fuel bill will increase by over €1bn due to higher oil prices (despite our more fuel-efficient fleet). While we continue to enjoy a significant cost advantage over competitor airlines, we expect to record a modest increase in unit costs (ex-fuel) as annualised crew pay restoration, higher crew ratios this summer and increased enroute charges will not be fully offset by B737 Gamechanger deliveries in H1.  To date, S.23 demand is robust, and peak S.23 fares are trending ahead of last year.  Q1 fares, which benefitted from a strong Easter in April (and a very weak PY comparable due to Russia’s invasion of Ukraine), will be significantly higher than Q1 FY23.

Despite ongoing uncertainty over the timing of Boeing deliveries, almost 15% unhedged fuel, limited Q2 visibility and zero H2 fare visibility (normal at this time of year), we are cautiously optimistic that FY24 revenue will grow sufficiently to cover our €1bn higher fuel bill and still deliver a modest year-on-year profit increase.  This guidance remains heavily dependent upon avoiding adverse events during FY24 (such as the war in Ukraine or further, repeated, Boeing delivery delays).”

[1] Sustainalytics – a leading independent ESG & corporate governance research, ratings & analytics firm.