Budget airline Ryanair has posted a sharp fall in first-half profits, with growth in passenger numbers offset by lower fares.
Ryanair yesterday reported a first-half profit of 1.79 billion euros after tax, down 18% on the 2.18 billion euros figure it posted for the opening six months of the prior financial year.
Passenger numbers in the first half, totalling 115.3 million, were up by 9% on the same period of the prior financial year.
However, Ryanair noted that air fares in the second quarter were, at 61 euros, down by 7% on the same period of the prior financial year. This fall was not as steep as the 15% year-on-year decline recorded in the first quarter of the current financial year.
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Comparing the first half with the same period of the prior financial year, the average fare was, at 52 euros, down 10%.
Ryanair flagged the earlier timing of Easter. It noted “half” of Easter 2024 had fallen into the prior financial year. The airline's financial year runs to end-March.
It also highlighted “consumer spending pressure, driven by higher-for-longer interest rates and inflation reduction measures”, and a drop in online travel agency bookings ahead of summer 2024.
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Assessing the outlook, Ryanair said: “Forward bookings suggest that Q3 demand is strong and the decline in pricing appears to be moderating. We remain cautious on Q3’s [average] fare outlook, expecting them to be modestly lower than Q3 prior year, subject to close-in Christmas and New Year bookings. As is normal at this time of year, we have almost zero Q4 visibility, although this quarter will not benefit from last year’s early Easter, which will make the prior year Q4 comps (comparatives) challenging.”
It added: “We continue to target between 198 million and 200 million passengers in FY25 (+8%), subject to no worsening of current Boeing delivery delays. Unit costs performed well in H1 as the cost gap between Ryanair and EU competitor airlines continues to widen. We expect full-year unit costs to be broadly flat.”
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