Ryanair has published its first half financial year 2019 results (PAT), reporting a 7% fall in profits to €1.20 billion (excl. Laudamotion losses). Higher fuel, staff and EU261 costs have offset strong ancillary revenue growth of 8%. Average fares declined 3% due to excess capacity in Europe, an earlier Easter in Q1, repeated ATC strikes/staff shortages which caused a spike in cancellations of higher fare, weekend flights.
Full year 2019 PAT is guided in a range of €1.10 billion to €1.20 billion (excl. Laudamotion). Following a 3% reduction in first half fares, Ryanair expects fares to fall by c.2% in the second half due to weaker than expected forward fares in the third quarter (particularly the October school mid-term and Christmas) and the absence of Easter in the fourth quarter. A 1% reduction in winter capacity means that full year 2019 traffic will grow by 6% to 138 million (141m incl. Laudamotion). The fuel bill will be approx. €460 million higher than last year and “Other Costs” will be negatively impacted by higher EU261 costs.
Ancillaries are expected to continue to perform strongly although the second half figures will be adversely impacted by timing differences on the recognition of certain fees arising from the adoption of IFRS 15 (positive impact in the first half). This guidance excludes (exceptional) start-up losses in Laudamotion of approx. €150 million (which are and will be consolidated in the Ryanair Group full year financial results).
