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Ryanair Reports Q1 Loss Of €273M As Easter Travel Cancelled. Vaccine Rollouts & EU Digital Covid Certs Drive Strong Booking Recovery Into Peak Summer 2021.

Ryanair Holdings plc today (26 July) reported a Q1 loss of €273m, compared to a PY Q1 loss of €185m. Features of this Q1 performance included:


  • Q1 traffic rebounded from 0.5m to 8.1m as capacity recovered in May & June.
  • 1st B737-8200 “Gamechanger” delivered in June (12 for peak S.21).
  • Strong June cash balance of €4.06bn (up from €3.15bn at 31 Mar.).
  • €1.2bn 5-year unsecured bond issued in May at record low 0.875% coupon.
  • Net debt fell from €2.28bn at 31 Mar. to €1.66bn at 30 June (€850m bond repaid in June).
  • 379 new routes & 10 new bases announced for 2021.
  • Customer Advisory Panel appointed – 1st meeting in Sept.


Q1 – Group 30 Jun. 2020 30 Jun. 2021 Change
Customers 0.5m 8.1m +7.6m
Load Factor 61% 73% +12pts
Revenue €125m €371m +196%
Op. Costs €313m €675m +116%
Net Loss (€185m) (€273m) -47%


Ryanair Holdings Group CEO, Michael O’Leary, said:



Covid-19 continued to wreak havoc on our business during Q1 with most Easter flights cancelled and a slower than expected easing of EU Govt. travel restrictions into May and June.  Significant uncertainty around travel green lists (particularly in the UK) and extreme Govt. caution in Ireland meant that Q1 bookings were close-in and at low fares.  We kept aircraft and crews current throughout the quarter and recruited additional cabin crew to enable us recover quickly in Q2 as Covid restrictions ease.  The 1st July rollout of EU Digital Covid Certificates (“DCC”) and the scrapping of quarantine for vaccinated arrivals to the UK from mid-July has seen a surge in bookings over recent weeks.  Pricing remains below pre Covid-19 levels and there will continue to be great value for Ryanair guests travelling this summer as we focus on recovering traffic, jobs and tourism across our European network.  Based on current (close-in) bookings, we expect traffic to rise from over 5m in June to almost 9m in July, and over 10m in Aug., as long as there are no further Covid setbacks in Europe.  We will continue our load active/yield passive strategy as we recover load factors over the course of FY22.


The Covid-19 crisis has triggered the collapse of many European airlines including Flybe, Norwegian, Germanwings, Level and Stobart and led to substantial capacity cuts at many others including Alitalia, TAP, LOT, SAS, etc.  The tsunami of State Aid from EU Govts. to their insolvent flag carriers (Alitalia, AirFrance/KLM, LOT, Lufthansa, SAS, TAP and others) will distort EU competition and prop up high cost, inefficient, flag carriers for many years.  We expect intra-European capacity to be materially lower for the foreseeable future.  This will create growth opportunities for Ryanair to extend airport incentives, as the Group takes delivery of 210 new Boeing 737 “Gamechanger” aircraft.  We are encouraged by the high rate of vaccinations across Europe.  If, as is presently predicted, most of Europe’s adult population is fully vaccinated by Sept., then we believe that we can look forward to a strong recovery in air travel for the second half of the fiscal year and well into S.22 – as is presently the case in domestic US air travel.



Ryanair has repeatedly shown we can grow traffic while reducing our impact on the environment.  Every passenger that switches to Ryanair from Europe’s legacy airlines reduces their CO₂ emissions by almost 50% per flight.  Over the next 5-years our traffic will grow to 200m p.a.  This will be achieved on a fleet that balances the demand for low fares with the need for sustainable flying.  Our new B737-8200 “Gamechanger” aircraft (a $22bn+ investment) offers 4% more seats, but delivers 16% lower fuel burn and 40% lower noise emissions, helps to meaningfully lower Ryanair’s CO₂ and noise footprint over the next decade.


We continue to work actively with the EU, fuel suppliers and aircraft manufacturers to incentivise sustainable aviation fuel (SAF) use.  We are working with A4E and the EU Commission to accelerate reform to the Single European Sky, to minimise ATC delays and lower fuel consumption and CO₂ emissions.  Last year Ryanair received an industry leading “B-” climate protection rating from CDP[1], and we are working to improve this to an “A” rating over the next 2 years.  In April, Ryanair established a Sustainable Aviation Research Centre partnership with Trinity College Dublin to accelerate the development of SAFs.  Ryanair’s goal is to power 12.5% of our flights with SAF by 2030 (well ahead of the 5% recently mandated by the EU Fit for 55 Proposals).  Earlier this month we launched a new carbon calculator enabling customers to (voluntarily) offset their carbon footprint on every Ryanair flight that they book.  These initiatives will help Ryanair achieve our target of lowering CO₂ per passenger/km by 10% to just 60 grams by 2030.


In July, Ryanair announced a 7 member Customer Advisory Panel.  Following over 10,000 applications from across 16 countries, the final panel represents a diverse cross-section of Ryanair customers (with members from Germany, Ireland, Italy, Poland, Spain and the UK).  We will welcome this Panel to Dublin in Sept. for our first Customer Advisory meeting, with future meetings to take place in other major European cities.   The advice and input from the Panel will help shape Ryanair’s continuing customer improvements programme, re-enforcing our commitment to delivering the lowest fares, on-time flights and a great customer experience as the Group returns to strong post Covid growth.




Revenue & Costs

Q1 scheduled revenue increased 91% to €192m due to a rise in traffic from 0.5m to 8.1m (at a 73% load factor). While traffic recovered significantly (compared to PY Q1), the cancellation of Easter traffic and the delayed relaxation of Govt. travel restrictions across the EU into May and June required significant price stimulation.  Ancillary revenue performed well, generating approx. €22 per passenger, as more guests choose priority boarding and reserved seating.  As a result, total revenue increased by almost 200% to over €370m in Q1.  A sevenfold increase in sectors saw operating costs increase 116% to €675m, driven primarily by variable costs such as fuel, airport & handling and route charges.  The Group’s fuel requirements are just under 60% hedged for FY22 at $565 per metric tonne and approx. 35% hedged for FY23 at $600.  Carbon credits are fully hedged for FY22 and approx. 35% hedged for FY23 at under €24 per EUA (compared to forward rates of over €50).


During Q1 our Route Development team continued their work with airport partners across Europe, and have negotiated lower airport costs, recovery incentives and the extension of many low cost airport growth deals.  In addition to previously announced deals (with Billund, Riga, Stockholm, Zadar & Zagreb) and long term extensions of low-cost growth deals in London Stansted (to 2028), Milan Bergamo (to 2028) and Brussels Charleroi (to 2030), the Group has doubled its capacity in Rome (Fiumicino), added new routes to Helsinki and will launch new bases in Turin (Italy) and Agadir (Morocco) this winter.


In June Ryanair took delivery of our first 3 B737-8200 “Gamechanger” aircraft from our 210 orderbook.  The Gamechangers have 4% more seats, 16% lower fuel burn and 40% lower noise emissions and will, we believe, further widen the cost gap between Ryanair and all other European airlines for the next decade.  While it is early days (and load factors have not yet recovered to pre Covid levels) we are very pleased with the operational performance and lower fuel burn recorded on these aircraft.  The feedback from our guests is resoundingly positive as they enjoy the extra leg room and 40% less noise.  We hope to increase our fleet of Gamechangers to over 60 in advance of S.22 and these new aircraft will drive our traffic growth to 200m p.a. by FY26.


Balance Sheet & Liquidity

Ryanair’s balance sheet is one of the strongest in the industry with a BBB credit rating (S&P and Fitch), €4.06bn cash and almost 90% of our B737 fleet unencumbered at quarter end. In May Ryanair issued a €1.2bn 5-year, unsecured, bond at a record low coupon of 0.875%.  In June the Group repaid its maturing €850m (2014) 1.875% bond.  Strong operating cashflows and supplier reimbursements drove a €0.62bn reduction in net debt to €1.66bn at 30 June (31 March: €2.28bn).  This balance sheet strength enables the Group to capitalise on the many growth opportunities that will be available in Europe in the post Covid-19 recovery.



FY22 continues to be challenging, with Covid-19 travel restrictions prolonging uncertainty.  Following the 1st July rollout of EU DCC’s (and the relaxation of the UK’s quarantine rules) for fully vaccinated persons, our Group has seen Q2 bookings recover strongly (albeit at low fares).  With the booking curve remaining very close-in and fares well below pre Covid-19 levels, visibility for the remainder of FY22 is close to zero.  It therefore remains impossible to provide meaningful FY22 guidance at this time.  We believe that FY22 traffic has improved to a range of 90m to 100m (previously guided at the lower end of an 80m to 120m passenger range) and (cautiously) expect that the likely outcome for FY22 is somewhere between a small loss and breakeven.  This is dependent on the continued rollout of vaccines this summer, and no adverse Covid variant developments.


As we look beyond the Covid-19 recovery, and the successful completion of vaccination rollouts, the Ryanair Group expects to have a materially lower cost base, a very strong balance sheet and industry leading traffic recovery.  Our new B737 “Gamechanger” aircraft will reduce fleet costs and unit costs (thanks to its attractive pricing, higher seat density and 16% lower fuel burn) for the next decade.  They will enhance revenue opportunities with 4% more seats, enabling the Group to fund lower fares and capitalise on the many growth opportunities that are now available across Europe, especially where competitor airlines have substantially cut capacity or failed. We are seeing a strong rebound of pent up travel demand into Aug. & Sept. and we expect this to continue into the second half of FY22, with pre Covid-19 growth planned to resume strongly in summer 2022.”

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