Ryanair beats profit forecasts on higher fares

Dublin — Ryanair, Europe’s largest low-cost carrier, posted an after-tax profit for the three-month period ended December 31 that beat analysts’ forecasts on Monday, but revised down its passenger outlook on delays in Boeing aircraft delivery.

After tax-profit for the third quarter came in at €149m, ahead of the €60m profit forecast in a company poll of analysts.

That was mainly due to a better-than-expected 1% increase in average fares in the quarter, compared with a fall of 7% during the previous quarter, CFO Neil Sorahan said, citing good last-minute bookings for Christmas and New Year holidays.

Ryanair, which makes most of its profit during the summer season, said it was “cautiously guiding” after-tax profit for the 12 months to March 31 in a range of €1.55bn-€1.61bn.

It is too early to give guidance on the coming summer, but early indications are that bookings are robust and European short-haul capacity is likely to be constrained, Sorahan said.

Ryanair said it expects to take delivery of nine Boeing 737 MAX aircraft ahead of its peak summer season, fewer than expected, and as a result will cut its forecast for passenger numbers in the 12 months to March 31 2026 to 206-million from 210-million. An earlier forecast of 215-million was cut in November.

The final 29 aircraft of Ryanair’s 210 MAX order will arrive by March next year, lifting traffic to 215-million passengers in the year to March 2027, he said.

Sorahan, who recently returned from a trip to Boeing’s production facilities in Seattle, said the delays were disappointing but that he had a “strong level of confidence” that the nine aircraft would arrive on time.

“We can see big improvements in the factory. The quality of the fuselage ... have improved greatly, but they’re just not going to get there for this summer,” he said in an interview.

Ryanair, which has no aircraft orders with any other manufacturer, is not particularly concerned about Boeing’s financial position and that as a systematically important company to the US economy it would be supported “come what may,” Sorahan said.

Reuters