Ryanair expecting ‘most challenging year’ as airline industry faces Covid-19

Ryanair said it is braced for “the most challenging year” in its 35-year history and expects to post a full-year loss of nearly 1 billion euros.

The Irish low-cost carrier said coronavirus continues to “wreak havoc across the industry” and is “cautiously guiding an FY21 net loss (pre-exceptional items) of between 850m euros (£750m) and 950m euros (£838m).”

However, the airline said it would be in a position where it could “capitalise on the many growth opportunities” after the pandemic, “especially where competitor airlines have substantially cut capacity or failed”.

The company announced third-quarter losses of 307 million euros (£270 million) on Monday, adding that in the three months to December, 8.1 million passengers used Ryanair, compared to 35.9 million in the same quarter in 2019.

The loss for the quarter contrasts with an 88 million euro (£78 million) profit after tax in the same period a year before.

The company said: “FY21 will continue to be the most challenging year in Ryanair’s 35 year history.

“Recently announced Covid lockdowns and travel restrictions across the EU & UK will reduce forecast FY21 traffic to between 26m and 30m (previously “up to 35m”), with more risk towards the lower end of the range.

“While Q4 visibility remains limited due to uncertain and constantly changing Covid-19 travel restrictions, European government lockdowns, the timing of the rollout of vaccines across the EU and a very close-in booking curve, we are cautiously guiding an FY21 net loss (pre-exceptional items) of between 850m euros (£750m) and 950m euros (£838m).”

Compared with the same quarter in 2019, revenue fell 82% from 1.91 billion euros (£1.69 billion) to 0.34 billion euros (£0.3 billion), and operating costs also fell 63% from 1.81 billion (£1.6 billion) to 0.67 billion (£0.59 billion).

The firm said: “As we look beyond the Covid-19 crisis, and vaccinations roll out, the Ryanair Group expects to have a much lower cost base and a strong balance sheet, which will enable it to fund lower fares and add lower-cost aircraft to capitalise on the many growth opportunities that will be available in all markets across Europe, especially where competitor airlines have substantially cut capacity or failed.”