Ryanair aims to surpass pre-Covid carryings and return to “reasonable profitability” this financial year.
The projection came as Europe’s largest low cost carrier reported a reduced loss of €355 million for the 12 months to March 31 against €1.015 billion the previous year.
Passenger numbers recovered to 97 million from 27.5 million during the height of the pandemic.
Average fares in were down 27% to just €27 in the year to March. Ancillary revenue delivered a “solid performance”, generating more than €22 per passenger as traffic recovered and passengers increasingly chose priority boarding and reserved seating. Total revenues increased by more than 190% to €4.8 billion but operating costs also rose 113% to €5.27 billion.
Group chief executive Michael O’Leary said the airline planned to grow traffic to 165 million passengers in the year to March 2023, above the 149 million achieved before Covid-19 hit.
He said: “While bookings have improved in recent weeks, the booking curve remains much closer-in than was typical pre-Covid at this time of year.
“The damaging impact of the Omicron variant, and Russia’s invasion of Ukraine in February. means that Q1 pricing continues to need stimulation.
“There is, however, pent-up demand and we are cautiously optimistic that peak summer ‘22 fares will be somewhat ahead of peak summer ‘19 pre-Covid levels.”
Despite the “significant risks” posed by both the invasion of Ukraine and Covid, “we hope to return to reasonable profitability in full year 2023,” O’Leary said.
But he warned that the recovery remains fragile and a 20% level of unhedged fuel “will give rise to some unbudgeted cost increases”.
The fragility of the sector “was clearly evidenced by the sudden, and unexpected, emergence of the Omicron variant pre-Christmas and the Russian invasion of Ukraine in February, both of which immediately damaged close-in bookings and yields for the Christmas and Easter peak travel periods.
“Given the continuing risk of adverse news flows on both these topics, it is impractical, if not impossible, to provide a sensible or accurate profit guidance range at this time,” O’Leary said.
He repeated the company’s target of 50% traffic growth to 225 million passengers by 2025 at lower fares as more Boeing 737 Max aircraft are introduced to the fleet
“Our growth plans to 2026 will see Ryanair create over 6,000 well-paid jobs for highly skilled aviation professionals all over Europe,” O’Leary pledged.
“Despite the recent disruption of our traffic recovery by both the Omicron variant and the Russian invasion of Ukraine, we remain committed to restoring the pay cuts we agreed with our people during the Covid shut downs.
“We have made some progress with pilots and cabin crew in certain markets on partial restorations in 2022.
“But, in other markets the slow pace of union negotiations have hindered this acceleration of similar restorations.
“We remain committed to delivering the first tranche of our agreed three-year restoration plan as agreed in July 2022 and we are prepared to accelerate years two and three into one restoration in July 2023 if Ryanair returns to pre-Covid load factors and profitability during year end March 2023.
“We are committed to the full pay restoration for all our people as soon as our business returns to pre-Covid profitability.”
He promised more service improvements later this summer, including auto check-in and airport express “to facilitate faster journeys through airports”.