Ryanair dives to €200m loss as coronavirus decimates passenger numbers
Ryanair crashed to a €197m (£177.8m) loss in the first half of the year as the budget carrier flew just 17m due to the coronavirus pandemic.
From the start of lockdown in March to the end of June, 99 per cent of the Irish airline’s planes were grounded amid stringent travel bans and health concerns.
Despite returning to service from 1 July, it only managed to fly 20 per cent of last year’s passenger numbers over the summer period.
As a result, Ryanair swung from a £1.2bn profit last year to a loss of nearly £200m, and warned that second half losses could be even greater.
It has already cut winter capacity by an additional 20 per cent due to new travel restrictions, but that was before it was announced that international travel would be banned in England from Thursday.
But speaking to the BBC, boss Michael O’Leary said that the carrier would not reduce capacity any further.
“We’ve already stripped out the schedule for most of November and the December, we have really just a skeleton schedule for the services between UK airports and continental European destinations”, he said.
But he tore into the second lockdown, describing it as the result of “political mismanagement” and urging ministers to focus on developing its Test and Trace programme.
Susannah Streeter, senior markets analyst at Hargreaves Lansdown, said the new lockdown rules were a “body blow” for the carrier.
“Already airline crews have had to take painful cuts to pay and conditions, which has helped Ryanair limit operating losses to €177m for the six months to September”, she added.
In a statement, Ryanair said that it expected to carry 38m passengers across the whole financial year.
“This guidance could be further revised downwards if EU governments continue to mismanage air travel and impose more uncoordinated travel restrictions or lock downs this winter”, it added.
The carrier also slammed governments across the continent for the role they have played in propping up airlines through the crisis.
“[Coronavirus] has sparked a flood of illegal State Aid from EU Governments to their flag carriers including Alitalia, Air France/KLM, LOT, Lufthansa, SAS, TAP and others.
“This illegal State Aid will distort competition and allow failed flag carriers to engage in below cost selling for many years”, Ryanair said.
But it added that the reduction in airline capacity would create opportunities for the low-cost flyer.
This in part is due to the carrier’s hefty cash position, which stood at €4.5bn at the end of September.
Shares in the carrier dropped two per cent as markets opened this morning.