Ryanair slams governments over 'mismanaging' of air travel as losses mount
Ryanair has reported losses of €197 million (£178m) for the first half of the year and is braced for an even larger deficit in the second half as the pandemic turmoil shows no sign of easing.
The Dublin-based budget airline said it “expects to record higher losses” in the second half of the year, despite having a lower cost base and a stronger balance sheet.
Coronavirus lockdowns led to 99 per cent of the carrier’s fleet grounded for almost four months between mid-March and the end of June.
Traffic in the first half of the year tumbled from 86 million to 17 million passengers compared with the same period last year. Revenue plunged 78 per cent to €1.18 billion (£1.06bn), while the loss in this half year contrasts with a profit after tax of €1.15bn in the first half of the last financial year.
With almost no traffic in the first quarter of the year, the “vast majority” of the first half of the year’s revenue was earned in the second quarter, the airline noted.
It added: “Given the current Covid-19 uncertainty, Ryanair cannot provide [full-year profit after tax] guidance at this time.
“The group expects to carry approximately 38 million passengers in FY21, although this guidance could be further revised downwards if EU governments continue to mismanage air travel and impose more uncoordinated travel restrictions or lockdowns this winter.”
It said the pandemic, uncertainties over Brexit, airline pricing, fuel costs, competition from new and existing carriers, actions by governments and the willingness of passengers to travel “could significantly impact” its results for the remainder of the year.
It was also critical of what it called a “flood of illegal state aid from EU governments” to carriers including Air France and Lufthansa, which it said would “distort competition and allow failed flag carriers to engage in below-cost selling for many years”.
Susannah Streeter, senior investment and markets analyst at Hargreaves Lansdown, said: “Before the pandemic hit, the budget airline was riding high on demand for low cost flights across Europe, but passengers numbers have nosedived by 80 per cent and the turbulence over the winter months is just going to get worse as new lockdowns restrict travel even further.”
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