Tag Archives: Ryanair

Ryanair cuts capacity in October by another 20%

Ryanair has announced that it would cut its October capacity by a further 20% (in addition to the 20% cut already announced in mid-August). Ryanair now expects its October capacity to fall from 50% to approximately 40% of its October 2019 levels, but expects to maintain a 70%+ load factor at this reduced schedule.

Ryanair confirmed that these capacity reductions were necessary due to damage caused to forward bookings by continuous changes in EU Government travel restrictions and policies, many of which are introduced at short notice, which undermine consumers’ willingness to make forward bookings. In some countries (most notably Ireland), where the Government have maintained excessive and defective travel restrictions since July 1, 2020, COVID-19 rates have risen in recent weeks to 50 per 100,000 pop. – more than double those of Germany and Italy – where intra-EU air travel was freely permitted since 1 July.

Ryanair welcomes the EU Commission’s plan to remove intra-EU travel restrictions, subject only to the ECDC weekly update on COVID case / positive test trend rates by EU country and region, and calls for this coordinated approach to be immediately implemented by all EU States, especially Ireland, so that EU citizens can make essential bookings for business and family travel, free from the worry of flight cancellations and/or defective quarantine restrictions.

Ryanair aircraft photo gallery:

 

Ryanair August traffic falls 53% to 7.0 million guests as COVID-19 restrictions impact traffic

Ryanair Holdings plc has released its August traffic statistics as follows:

   2019 2020      Growth
Ryanair Group  14.9m 7.0m -53%
     
Rolling Annual 149.2m   88.9m  (91% LF) -40%

 

Ryanair operated approximately 60% of our normal August schedule with a 73% load factor.

Ryanair announces additional flights to Faro, Portugal

Ryanair has announced it would be strengthening its connection between the UK and Portugal over the coming weeks (September 11– October 24) with 14 additional flights to Faro every week from 12 UK airports:

Increased Flights to Faro Flights Per Week
Bournemouth 4 (+1)
Bristol 6 (+1)
Cardiff  3 (+1)
Edinburgh 4 (+1)
East Midlands Airport 8 (+1)
Glasgow Prestwick 4 (+1)
Liverpool 6 (+1)
London  Southend 3 (+1)
Luton 5 (+1)
Manchester 13 (+2)
Newcastle 4 (+2)
Stansted 15 (+1)

 

Ryanair and Spanish pilot union SEPLA agree on pay cuts to save Spanish jobs

Ryanair made this announcement:

Ryanair welcomed SEPLA’s acceptance for Spanish Pilots of a 4-year agreement, which includes a 20% pay reduction restored over 4 years, along with productivity improvements on rosters, flexible working patterns and annual leave to minimize Spanish Pilot job losses. This agreement gives Ryanair a framework to flex its operation during the COVID-19 crisis and a pathway to recovery when the business returns to normal in the years ahead.

The SEPLA agreement was overwhelmingly accepted by more than 80% of Ryanair’s Spanish Pilots, demonstrating that Ryanair Pilots and their Union are willing to work with the company during the COVID-19 crisis where Ryanair will carry significantly less traffic, at much lower fares for the foreseeable future. Just this week Ryanair announced further 20% reductions to its September and October flight capacity as forward bookings have notably weakened.

Ryanair has demonstrated its ability to work with unions and conclude these agreements across its European operation, including now with our Spanish pilots. Regrettably in Spain it has been impossible to reach an agreement with the cabin crew unions USO and SITCPLA who – uniquely in Europe – continue to obstruct necessary cost savings putting jobs and tourism links at risk. In every other EU market where Ryanair operates, we have been able to negotiate agreements to save jobs, improve productivity and reduce costs in response to the Covid-19 crisis both with Pilot and Cabin Crew Unions. Sadly USO’s and SITCPLA’s failure to negotiate or meaningfully engage will now mean that Spanish Cabin Crew job losses are now more likely as we have no agreement with Spanish cabin crew unions.

 

Ryanair cuts capacity through October by almost 20% due to weaker than expected bookings

Ryanair has announced that it would reduce its flight capacity by 20% during the months of September and October as forward bookings have notably weakened over the last 10 days, given continuing uncertainty over recent COVID-19 case rates in some EU countries.

Ryanair confirmed that most of these cuts would be frequency reductions rather than route closures, and they will be heavily focused on those countries such as Spain, France and Sweden, where rising recent COVID-19 case rates have led to increased travel restrictions, and Ireland which continues to impose a uniquely restrictive Green List, which imposes 14 day quarantines on visitors from most other EU countries such as Germany (16.3) and the UK (18.6), which have lower COVID-19 case rates over the last 14 days than Ireland (22.1).

A Spokesperson for Ryanair said:

These capacity cuts and frequency reductions for the months of September and October are necessary given the recent weakness in forward bookings due to COVID restrictions in a number of EU countries. Any effected passengers in September received email notification earlier advising them of their options. Similar communications will be issued to the small number of affected passengers in October later. Over the past 2 weeks as a number of EU countries have raised travel restrictions, forward bookings especially for business travel into September and October have been negatively affected, and it makes sense to reduce frequencies so that we tailor our capacity to demand over the next 2 months.

Proper testing at airports, and effective tracing (as is being conducted in Germany and Italy) is the only realistic and proportionate method of supervising safe intra-EU air travel while effectively limiting the spread of the COVID-19 virus.”

Ryanair restores 60% of scheduled flights in August

Ryanair has announced it has restored over 60% of normal flight schedules from August 1, 2020, following the successful resumption of its services at the end of June.

Throughout July, Ryanair have flown 4.4 million customers to destinations across Europe, reuniting friends and family, allowing commuters to get back to work, as well as jetting tourists off for post-lockdown breaks to some of the continent’s most popular holiday hotspots.

As Europe’s skies get busier and traveller confidence returns, Ryanair will continue to increase its flight frequencies throughout August with more than 1,600 routes and over 11,000 weekly flights across its network.

Ryanair encourages all passengers to observe the healthy flying measures it has had in place since mid-May, including the mandatory use of facemasks and a reduced in-flight cashless service.

Ryanair reports fiscal first quarter loss of €185 million as traffic falls by 99%

Ryanair Holdings plc on July 27 reported a fiscal first quarter loss of €185 million, compared to a PY Q1 net profit of €243 million. Highlights of Q1 include:

  • Over 99% of the fleet grounded from mid-March to end June.
  • Q1 traffic fell from 42m to 0.5m.
  • Group airlines operated repatriation, rescue & medical emergency flights.
  • Cash preservation prioritised – closing cash €3.9bn
  • Cost reduction measures being successfully implemented.
  • Successful return to flying implemented in late June.

 

Q1 (IFRS) – Group 30 Jun. 2019 30 Jun. 2020 Change
Customers 41.9m 0.5m -99%
Load Factor 96% 61% -35pts
Revenue €2,312m €125m -95%
PAT/(Net Loss) €243m (€185m) n/m

 

COVID-19:

The past quarter was the most challenging in Ryanair’s 35 year history.  Covid-19 grounded the Group’s fleet for almost 4 months (from mid-March to end June) as EU Governments imposed flight or travel bans and widespread population lockdowns.  During this time, Group airlines repatriated customers and operated rescue flights for different EU Governments, as well as flying a series of medical emergency/PPE flights across Europe.  Our aircraft and crews were kept current by operating skeleton schedules and currency flights which ensured that the Group airlines were ready to efficiently resume flights when lockdown restrictions eased in most EU countries in late June/early July.  On July 1, the Group resumed flights across the majority of our route network.  We expect to operate approximately 40% of our normal July schedule, rising to around  60% in August and, hopefully, 70% in September.  The Group has implemented extensive health measures through the travel journey, especially onboard aircraft, to comply with EU guidelines (published by the ECDC & EASA in May) to ensure that Group airlines maintain the health of our guests and crews while minimising the risk of Covid-19.

Ryanair’s Customer Service teams safely returned to the office in June and, with support from Ryanair Labs, they are working through an unprecedented volume of customer emails and other communications related to flight changes and Covid-19 cancellations, while clearing a record backlog of refunds caused by almost 4 months of EU Government imposed flight cancellations.  This process has been delayed by unauthorised screen scrapers providing falsified customer details at the time of booking.  It is expected that over 90% of customer cash refund requests will be cleared by the end of July.

 

At this time, the Group expects FY21 traffic to fall by 60% (from 149m) to just 60m.  The Covid-19 crisis has already seen the closure of various EU airlines including Flybe, Germanwings, Level and Sun Express.  It has sparked a multi-billion flood of illegal State Aid from EU Governments to their flag carrier airlines including Alitalia, Air France/KLM, Lufthansa, SAS, TAP and others.  This illegal State Aid will distort competition and allow unsustainable flag carriers to engage in below cost selling for many years to come.  Many other airlines are cutting capacity, with the result that air travel in Europe is likely to be depressed for at least the next 2 or 3 years.  This will create opportunities for Ryanair (Europe’s lowest cost airline group) to grow its network, and expand its fleet, to take advantage of lower airport and aircraft cost opportunities that will inevitably arise.

Q1 BUSINESS REVIEW:

 

Revenue & Costs

Revenue fell by 95% (almost €2.2bn) to just €125m as traffic dropped 99% at just 0.5m.  An 85% reduction in costs during Q1 was not sufficient to offset this revenue loss as bookings came to an abrupt standstill in the initial weeks of the Covid-19 crisis.  During the past 3 months significant work has been undertaken to improve Ryanair’s cost leadership, which is vital if Group airlines are to compete against hugely subsidised flag carriers who will be able to engage in below cost selling for years to come.  The Group have negotiated modest pay cuts with our people and their unions that will, hopefully, help to avoid widespread job losses.

Our Route Development teams are working with airports all over Europe who have suffered substantial traffic declines during the Covid-19 crisis. Discussions are ongoing with aircraft suppliers to reduce aircraft lease rates and purchase prices to reflect the new post Covid-19 reality. The management team at Lauda were forced to implement a deep and painful rescue plan, which involved cutting the Lauda fleet from 38 to 30 aircraft in S.20 and substantially reducing headcount numbers in Vienna and Germany while closing its 3 aircraft Stuttgart base. Lauda worked closely with its people in Vienna to deliver substantial cost savings, enhanced productivity and more efficient rosters as without these savings Lauda’s main Vienna base would have closed on 29 May last.

 

Boeing MAX update

It is over a year since the Group was due to take delivery of its first Boeing 737-MAX-200 aircraft.  Boeing are indicating a late Q3 2020 return to service in the US for the Boeing 737-MAX, allowing Ryanair to, hopefully, accept delivery of its first MAX-200 before the end of 2020 and potentially up to 40 MAXs ahead of Summer 2021. We remain committed supporters of these “gamechanger” aircraft which have 4% more seats, 16% lower fuel burn and 40% lower noise emissions.  These new aircraft will enable the Ryanair Group to grow to 200m passengers p.a. over the next 5 or 6 years while reducing the Group’s cost base and significantly lowering its environmental footprint.

 

Balance Sheet & Liquidity

Ryanair’s balance sheet is one of the strongest in the industry with over €3.9bn cash at 30 June. We own 333 unencumbered B737s (with a book value of approx. €7bn) and hold a BBB investment grade rating from both S&P and Fitch Ratings. Since mid-March, the Group has moved quickly and smartly to preserve cash, cut costs, cancel share buybacks and defer all non-essential capex.  This has protected the Group’s very strong liquidity position as it returns to flying in July.  Over the winter, Ryanair will (as agreed last year) complete the sale of 7 of its oldest B737s and will continue to focus on cash preservation/generation and the repayment of maturing debt over the next 24 months.

 

BREXIT:

The challenge of Brexit, and in particular a no-deal Brexit, remains high.  We hope, before the end of the Transition Period in Dec., that the UK and Europe will agree a trade deal for air travel which will allow the free movement of people and the deregulated airline market between the UK and Ireland to continue.  As an EU airline, the Ryanair Group should be less effected by a no-deal Brexit than UK registered airlines.  We still, however, expect adverse trading consequences to arise.  Ryanair has put the necessary measures in place to ensure that the Group remains majority EU owned, including restricting voting rights of non-EU shareholders, in the event of a “hard-Brexit”. We therefore expect the Group’s AOCs in Austria, Ireland, Malta and Poland to continue to operate freely.  In addition, Ryanair’s UK AOC (Ryanair UK) will be able to benefit from any bilateral agreements negotiated between the UK and non-EU countries while facilitating the operation of domestic UK flights.

 

OUTLOOK:

FY21 will be a very challenging year for the Ryanair Group of airlines.  It is impossible to predict how long the Covid-19 pandemic will persist, and a 2nd wave of Covid-19 cases across Europe in late autumn (when the annual flu season commences) is our biggest fear right now.  Hopefully EU Governments, by implementing effective track and tracing systems, and EU citizens by complying with recommended face masks, rigorous hand hygiene and other measures, will avoid the need for further lockdowns or restrictions on intra-EU flights.  It is vital that European economies begin the process of recovery this summer to minimise the damage arising from the Covid-19 pandemic and this recovery can only be led by intra-EU air travel which is the engine of EU growth and economic activity.

 

Given the current uncertainty, Ryanair cannot provide any FY21 PAT guidance at this time.  The Group currently expects to carry approx. 60m passengers in FY21 and expects to record a smaller loss in Q2 (which reflects a gradual return to flying from 1 July) than in Q1.  However, the Ryanair Group will emerge from the Covid-19 crisis with a much lower cost base, which will be essential to fund lower fares as the Group competes against unlawfully State aided flag carriers.  Further updates will be provided at Ryanair’s AGM in Sept.

Ryanair sees a surge in bookings to Malta

Ryanair has announced that it’s seen a surge in its Maltese Summer 20 bookings, with tens of thousands of passengers booking to the island since it was announced that travel restrictions were progressively lifted on July 1st and 15th.

Over the last two weeks, Malta has been one of Ryanair’s strongest destinations proving to be a clear favourite thanks to its 300 days of guaranteed sunshine. Ryanair currently operates over 45 routes to/from Malta and its UK routes to the beautiful Mediterranean island rank among the most booked for the months of July and Aug 2020.

Malta Air’s CEO Diarmuid O’Conghaile said:

“Malta has progressively lifted its restrictions on EU arrivals since 1st July. Since then tens of thousands of European passengers have booked flights to Malta departing from 45 destinations such as Birmingham, Brussels, Edinburgh and Madrid, but with UK routes as clear winners for Jul & Aug bookings.

This surge in Malta flight bookings is a really encouraging trend and Ryanair is proud to re-boot the tourism sector of countries like Malta, which strongly rely on the health of this industry.