Ryanair Holdings reported Q1, 2023 profit of €663 million citing strong Easter, the extra UK (Coronation) public holiday in May 2023. The Group reported €170 million profit after tax last year due to Russia’s invasion of Ukraine in February 2022 damaging last year’s Q1 traffic and fares.
The airline’s Q1 scheduled revenues increased 57% to €2.47bn, traffic grew 11% to 50.4 million and average fares rose 42% to €49 thanks to a strong Easter and the coronation holiday in UK.
The Group’s ancillary revenue increased 15% to €1.18bn (c.€23.30 per passenger) while the total Q1 FY23-24 revenue rose 40% to €3.65bn. Total operating costs increased 23% to €2.94bn, primarily due to higher fuel, staff costs, and higher ATC fees.
Ryanair’s balance sheet is one of the strongest in the industry with a BBB+ credit rating and over €4.8bn gross cash at quarter end, despite over €1bn capex. Net cash increased to €0.98bn at 30 June (€0.56bn at 31 Mar.).
“Substantially all of the Group’s B737 fleet is unencumbered, which significantly widens the cost advantage as interest rates and leasing costs continue to rise for competitors,” the Group said in a statement.
Ryanair is on track to repay its second 2023 bond of €750m due in August 2023 and €2.8bn FY24 capex from internal cash resources.
“Our Board strategy, as our business recovers, is to firstly prioritise pay restoration and multi-year pay increases for our people. Secondly, we will pay down maturing debt as it falls due over the next 3 years, while at the same time funding our ambitious aircraft capex, from internally generated cashflows. Once we are confident that we can fully fund these large commitments, the Board will then consider restarting modest returns to shareholders, who supported Ryanair during the Covid pandemic,” the statement added.
Speaking on the sustainability front O’Leary said: “Every customer switching to Ryanair from high fare EU legacy carriers can reduce their emissions by up to 50% per flight. We continue to invest heavily in new technology aircraft. During Q1 we took delivery of 21 fuel efficient, B737-8200. In May, we signed a deal with Repsol to supply SAF to Ryanair bases in Spain. This builds on similar SAF arrangements with OMV, Neste & Shell and puts the Group on track to achieve its ambitious 2030 goal of powering 12.5% of Ryanair flights with SAF - with 9.5% already secured.”
With Ryanair’s recent $40bn order for 300 Boeing MAX-10 aircraft the Group plans to pursue more ambitious environmental targets over the next decade. Given the strength of the Group’s balance sheet, the airline anticipates that most of this capex will be funded primarily from internal resources
Ryanair is operating its largest ever summer schedule of over 3,200 flights and up to 600,000 passengers daily. The Group has opened 3 new bases - Belfast, Lanzarote & Tenerife and over 190 new routes with recent announcement of new route to and from Albania this winter.
The airline fleet stood at 119 at quarter-end, with plans to increase the fleet to 124 by July-end. The airline expects to take delivery of 49 B-820ss by the end of FY2024.
The Group expects passenger traffic in FY24 to grow to approximately to 183.5 million, up 9% from the same time last year.