Irish LCC Ryanair has reduced its estimated loss for the 2021 financial year by up to €100 million ($119 million). The airline will release its full results next month for the year from April 2020 to March 2021. While the airline is expecting a sizeable loss, it maintains strong liquidity.
An airline posting a loss for the past 12 months is hardly surprising. After all, almost every corner of the industry has faced its worst crisis to date. However, there was a silver lining for the aircraft storage industry. While the pandemic has hit every airline equally, some have fared better than others. All things considered, Ryanair seems to be doing quite well.
A revised loss for the past year
Ryanair today revised its expected loss for the 2021 financial year, In other words, the 12 months up to and including March 31st, 2021. Before today’s announcement, Ryanair had been expecting a loss of between €850 million and €950 million ($1.01 billion to $1.13 billion).
However, in a filing issued today, the Ryanair Group revealed that it now expects its loss for the past 12 months to come in between €800 million and €850 million ($951 million to $1.01 billion). This represents a decrease of between €50-100 million. Ryanair’s fleet of owned aircraft currently sits at 420 Boeing 737s. However, it should soon increase slightly with the first 737 MAX deliveries.
Low traffic has hit the airline hard
Low passenger numbers have hit Ryanair hard. After all, with far fewer paying passengers, there is far less money coming into the company as revenue. The airline carried an average of 2.28 million passengers per month in the 2021 financial year, compared to 12.4 million a month in 2020. It moved just 27.3 million passengers in the past year. Despite this, the airline maintains liquidity of over €3.15 billion ($3.74 billion).
Due to the continued COVID-related travel bans across Europe, March was another poor month for the Irish LCC, with just 0.5 million passengers carried. However, Ryanair is reasonably confident that once travel is possible once more, its passenger numbers will bounce back. This is shown by a solid end to the previous summer. Indeed, in August last year, passenger numbers had bounced back by around half before falling again as we moved back into the winter season.
What does the next year hold?
It’s not entirely clear what the next year will hold. Indeed, last summer, it wasn’t expected that Europe would be plunged into a second lockdown. Ryanair recognizes this, commenting that it is not currently possible to provide meaningful guidance for the coming year. However, the airline does state that rather than its colossal loss this year, it now expects to be close to breaking even for the 2022 financial year.
Ryanair had previously estimated it would carry 80 million to 120 million passengers in the 2022 financial year. However, due to slow vaccine rollouts in Europe and extended travel restrictions, the airline currently believes that traffic will be closer to 80 million for the year. This would be down from 148 million in the 2020 financial year.
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