Ryanair swings to profit on European travel rebound

Ryanair has announced it returned to profit in the year to March 31, narrowly beating market expectations, and said it expected further improvements in the coming year.

Pre-tax profits for the Dublin-based low-cost airline were €1.44bn on revenues of €10.8bn, against a €430mn loss and €4.8bn of revenues in the year to March 2022. Profit after tax but before exceptionals — the company’s preferred measure — was €1.43bn, compared with a €355mn loss a year before. Analysts expected a figure between €1.32bn and €1.42bn.

The figures are the latest evidence of a rebound in the European airline industry and of Ryanair’s particularly strong post-Covid recovery. It carried 169mn passengers in the financial year, against 97mn a year before. The figure for the year to March 2023 was 13 per cent above the figure for the year to March 2020, before Covid disruption set in.

Ryanair’s load factor — the proportion of seats filled on its flights — recovered to 93 per cent, against 82 per cent for the year to March 2022.

Chief financial officer Neil Sorahan said the company had a “rebound” in traffic after a “difficult” April-to-June quarter last year following Russia’s invasion of Ukraine.

“We saw traffic across the remaining quarters increase quite significantly,” he said.

Costs — at €31 per passenger excluding fuel — were back down to pre-Covid levels, but fares were higher thanks to strong demand and tight capacity across the sector.

“Fares were trending about 10 per cent ahead of pre-Covid levels,” Sorahan said.

Ryanair projected further growth in passenger numbers and profits in the year to March 2024, saying it expected to carry 185mn passengers in the year. However, it also said it expected higher market prices would increase the company’s fuel bill for the year by more than €1bn, despite deliveries of more fuel-efficient 737 Max jets.

“We don’t have significant visibility at this point in time but [the April-to-June quarter] is going to be very strong given the weak comparisons from last year and the invasion of Ukraine,” Sorahan said.

Summer bookings were “robust” and fares were ahead of summer 2022 levels, he added.

The airline said there was “ongoing uncertainty” over a range of factors including the timing of new aircraft deliveries from Boeing, some unhedged fuel price exposure and future demand.

However, Sorahan said the company was likely to post higher profits in the year to March 2024.

“While we have no visibility into the second half, which is normal at this time of year, we would be cautiously optimistic,” Sorahan said.

Ryanair’s shares on Dublin’s Euronext exchange were up 2 per cent at €15.96.