Ryanair braced for record loss as pandemic “wreaks havoc” across the aviation industry
Ryanair is preparing for a year which it describes as “the most challenging year” in its 35-year history and expects losses to scale the £880 million mark.
Effects of the Pandemic
According to the low-cost airline, the negative impact of the coronavirus, which continues to “wreak havoc across the industry” is still being felt and is projected to carry well into the new year. The company also revealed that they are “cautiously guiding a FY21 net loss (pre-exceptional items) of between €850m and €950m.”
Nevertheless, the carrier which has its headquarters in Dublin said that at the end of the crisis, it would be in a position where it could “capitalize on the many growth opportunities, especially where competitor airlines have substantially cut capacity or failed.”
The group posted a loss of €307m and noted that in the three months to December, 8.1 million passengers used its aircraft, compared to 35.9 million in the exact same quarter in 2019. The loss for the quarter is in contrast with a €88m profit after tax in the same period a year ago.
The Most Challenging Year
The firm revealed to investors that “FY21 will continue to be the most challenging year in Ryanair’s 35-year history.
“Recently announced COVID-19 lockdowns and travel restrictions across the EU and the UK will reduce forecast FY21 traffic to between 26 million and 30 million (previously “up to 35 m”), with more risk towards the lower end of the range”.
“While Q4 visibility remains limited due to uncertain and constantly changing Covid-19 travel restrictions, European government lockdowns, the timing of the rollout of vaccines across the EU, and a very close-in booking curve, we are cautiously guiding a FY21 net loss (pre-exceptional items) of between €850m and €950m.”
Meanwhile, an analyst at investment platform eToro, Adam Vettese observed that “Airlines need something resembling normality soon, or we could see even more of them being swallowed up by this pandemic.”