On Monday, May 19, Ryanair, an Irish low-cost airline, released a new report indicating strong demand for air travel across Europe this year. The report forecasts that ticket prices will rebound, potentially offsetting last year’s profit losses.
“The booking demand across the network is very strong,” said Neil Sorahan, Chief Financial Officer of Ryanair, to Reuters. “We operate flights to 37 different countries. We are seeing robust summer demand everywhere.”
Despite a 7% decrease in ticket prices and a 16% year-on-year decline in profit for the fiscal year ending on March 31, the airline remains optimistic about recovering most of the losses. Sorahan described it as a decent turnaround.
The average ticket price increase of nearly 7% exceeded expectations. In March, Ryanair’s CEO Michael O’Leary predicted a ticket price increase of 4% to 6% for the year.
At 7:33 Greenwich Mean Time on Monday, Ryanair’s stock price rose by 3.4% to 23.17 euros. Last July, after a 15% average ticket price drop in the first quarter, the company’s stock price had dropped to 13.41 euros.
If the stock price remains above 21 euros for 28 consecutive days, O’Leary could receive a bonus of nearly 100 million euros. Since May 2 this year, the company’s stock price has consistently stayed above this level.
The company projects a 15% to 20% year-on-year increase in ticket prices for the three months leading up to June, mainly due to increased air travel demand during the Easter holiday.
O’Leary anticipates a 1% growth in summer bookings compared to the same period last year.
Ryanair’s post-tax profit for the fiscal year is 16.1 billion euros (approximately $18 billion), aligning with analysts’ expectations.
The company expects moderate growth in unit costs for the current fiscal year due to new aircraft, fuel hedging, and cost control offsetting increases in air traffic control fees and environmental taxes.
Citigroup analysts suggested investors may react positively to the forecast of mild cost inflation and ticket price recovery.
Despite readjusting its initial goal of transporting 205 million passengers due to Boeing’s aircraft delivery delays in the past 12 months, Ryanair made history by serving 200 million passengers. By March 31, 2026, the company aims to reach 206 million passengers for the fiscal year.
“Our delivery progress has been smooth,” stated Sorahan.
As one of the largest customers of Boeing, Ryanair expects the aircraft manufacturer to adhere to the agreed-upon prices for current aircraft orders post the implementation of equivalent tariffs by the European Union. Otherwise, Ryanair reserves the right to cancel orders.
(This article referenced reports from Reuters.)