Ryanair reports strong half year profits of €2.18bn 

Following a strong Easter, “record summer traffic” and higher fares, Ryanair has reported a strong half-year profit of €2.18bn, compared to a prior year H1 PAT of €1.37bn. 

For the first half of the year, Ryanair’s scheduled revenues increased 37% to €6.1bn. Traffic grew 11% to 105.4 million passengers, with an average load factor of 95%, while average fares rose 24% to c.€58 due to a strong Easter and record summer demand, says the airline.  

Ryanair reports that ancillary revenue increased 14% to €2.5bn, which is circa €23.70 per passenger, which bumped up total revenue by 30% to €8.6bn.  Total operating costs rose by 24% to €6.2bn, primarily due to much higher fuel costs, higher staff costs, and higher ATC fees. Ryanair maintains that it retains its cost advantage over most of its EU competitors continues to widen, with half yearly ex-fuel unit costs finishing at just under €32. 

Ryanair has hedged 85% of its FY24 fuel requirements at approx. $89bbl (a mix of forwards and caps) while the airline’s FY25 hedging has increased to just over 50% at approx. $79bbl.   

The airline liquidity (net cash) totals €0.84bn, and Ryanair confirmed that it had repaid more than €1bn of debt. 

Ryanair’s Michael O’Leary, said that the airline was working with Boeing to minimise delivery delays ahead of the summer peak in 2024. “At this stage, we are concerned that up to 10 of our 57 contracted Gamechanger deliveries pre S.24 may be delayed until winter 2024,” says O’Leary. 

He adds that the Pratt & Whitney engine (GTF) issues and inspection programme threatens to “substantially curtail competitor and lessor capacity between 2024 and 2026” and further constrain capacity in Europe for the “next 3 or 4 years”. For Ryanair, O’Leary says that such capacity constraints, “combined with our widening cost advantage, our judicious fuel hedging, strong balance sheet, low-cost aircraft orders and industry leading operational resilience, creates significant traffic and profit growth opportunities for Ryanair as we expand to carry 300m pax p.a. by FY34”.

Ryanair’s Board has declared a maiden ordinary dividend of €400m (c.€0.35 per share) in aggregate through an interim and final dividend of €200m each, payable in Feb. 2024 and after the AGM in Sep. 2024 respectively. 

Ryanair started that it plans to return approx. 25% of prior-year PAT (adjusted for non-recurring gains or losses) by way of ordinary dividend to shareholders, and will consider returning surplus cash to shareholders through special dividends and/or share buybacks so long as the carrier remains on its current positive trajectory.  

Ryanair continues to target approximately 183.5m (+9%) FY24 traffic, although it added that the final figure “depends on Boeing meeting their delivery commitments between now and year-end”.  The carrier still expects ex-fuel unit costs to increase by c.€2 this year, and reports that forward bookings (both traffic and fares) are “robust” over the late October mid-terms and into the peak Christmas travel period.  

Despite uncertainty over Boeing deliveries, a significantly higher full year fuel bill, very limited Q4 visibility and the risk of weaker consumer spending over coming months, Ryanair expects that FY24 PAT will finish in a range of between €1.85bn to €2.05bn, assuming modest losses over the H2 winter period.