LONDON, May 16 — Irish no-frills carrier Ryanair today announced a large reduction in annual net losses as the aviation sector recovered from pandemic lockdowns.

Loss after tax dropped to €355 million in the 12 months to the end of March, compared with a net loss of €1 billion in its previous financial year.

“This recovery, however, remains fragile” following Russia’s invasion of Ukraine, chief executive Michael O’Leary said in a statement.

“Given the continuing risk of adverse news flows on” Ukraine and Covid, “it is impractical — if not impossible — to provide a sensible or accurate profit guidance range at this time”, he added.

While Ryanair expects cost increases as a result of surging oil prices fuelled by the war, it hopes “to return to reasonable profitability” in its current financial year.

It forecast passenger traffic of 165 million in its current year, compared with a pre-pandemic level of 149 million.

The airline flew more than 97 million passengers last year compared with 27.5 million during the previous 12 months period when the pandemic struck.

Group revenue almost tripled to €4.8 billion last year as travel demand recovered.

Fares to rise

Despite surging inflation, Ryanair said its average fares fell more than a quarter to €27.

But with demand for the summer peak season set to jump, prices were set to rise, according to O’Leary.

“It seems to us that there will be higher prices into that peak summer period because there’s so much demand for the beaches of Europe,” he told BBC radio.

Ryanair had expected a much lower loss until the Omicron variant struck in late 2021, hitting fares and causing fresh disruption across its European routes.

The airline said it remained committed to restoring pre-Covid salaries for all its staff as soon as it returns to levels of profitability seen before the pandemic struck.

As well as cutting salaries, Ryanair axed 3,000 pilot and cabin crew jobs, or 15 per cent of staff, in the wake of the pandemic.

As travel recovers, however, airlines are in fierce competition to recruit staff and are in some cases offering welcome bonuses.

Following the earnings update, Ryanair’s share price slid three per cent to €13.21 in Dublin trading.

“There had been high hopes that by now the airlines would be riding high on a burst of pent-up demand from holiday makers but a warning from Ryanair that recovery remains fragile, has sent companies into a fresh bout of turbulence,” noted Susannah Streeter, senior investment and markets analyst at Hargreaves Lansdown.

Shares in rival EasyJet dropped 1.5 per cent to 491 pence in London. 

 - AFP