Ryanair chief Michael O’Leary today forecast “enormous growth opportunities” as the budget giant takes market share from rivals across Europe.
The airline is to operate its largest-ever schedule this summer with almost 2,500 routes and more than 3,000 daily flights as it capitalises on a rebound in demand following the pandemic.
This came on the back of annual profits for the year to March 31 hitting €1.43 billion, compared to a loss of €355 million in the previous 12 months.
Passenger numbers rose by 74% to reach 168.6 million producing increased revenue of €10.78 billion, a rise of 124% year on year.
Ryanair reported a winter seasonal loss of €154 million for the three months to the end of March as part of the annual results.
O’Leary highlighted market share gains achieved in Italy (from 27% to 40%), Poland (26% to 36%) and Ireland (49% to 58%) as it operated 116% of pre-Covid capacity in the 12 months.
He said that market share had “grown significantly” in most EU markets and that forward bookings and fares into the summer were strong.
“We expect European airlines will continue to consolidate over the next two years and it seems likely they will deploy capacity in a disciplined manner,” O’Leary forecast.
“The large backlog of aircraft deliveries is likely to constrain capacity growth in Europe for at least four more years which confers a considerable growth premium on Ryanair’s remaining 110 Boeing 737 ‘Gamechanger’ deliveries over the next three summers.
“Our widening unit cost advantage over all competitors, our fuel hedging, strong balance sheet and our very low-cost aircraft order book, as well as our proven operational resilience, creates enormous growth opportunities for Ryanair over the coming years.”
Ryanair hopes to grow traffic by 10% in the current financial year to about 185 million passengers but cautioned that recent delivery delays by Boeing may push some of this growth into the lower yielding autumn-winter second half “and may reduce this target slightly”.
O’Leary pointed to a fuel bill increasing by more than €1 billion due to higher oil prices but said he was “cautiously optimistic” that annual revenue will grow sufficiently to cover the higher fuel costs and still deliver a “modest” year-on-year profit increase.
“While we continue to enjoy a significant cost advantage over competitor airlines, we expect to record a modest increase in unit costs (ex-fuel) as annualised crew pay restoration, higher crew ratios this summer and increased en-route charges will not be fully offset by B737 ‘Gamechanger’ deliveries in H1,” he said.
“To date, summer ‘23 demand is robust, and peak fares are trending ahead of last year.”
He added: “This summer, in anticipation of further air traffic control disruptions, we have invested heavily in our operations – increased crew ratios, doubled the size of our ops centres, enhanced day-of-travel app and we continue to improve customer communications – to ensure that our passengers and crews continue to enjoy Ryanair’s industry leading on time performance and reliability.”