Ryanair has warned that this winter will bring deepening losses following the new wave of coronavirus restrictions being rolled out across Europe.
The airline has reported a net loss of €197m for the six months to the end of September after passenger numbers fell 80 per cent to just over 17m, marking the budget carrier’s first recorded loss in the usually highly profitable summer season for decades. The airline recorded a profit of €1.15bn during the same period last year. The airline expects to record higher losses in the second half of its financial year, which began on October 1, following travel restrictions in place across many of its key markets including the UK.
“Write off” winter
Ryanair has been forced to slash flight schedules with chief executive Michael O’Leary warning that he he expects this winter to be a “write-off”. The carrier has seen further drop in passenger demand since European governments began tightening restrictions in September which has curtailed travel to and from much of central Europe, the UK, Ireland, Austria, Belgium and Portugal.
Despite revenue crashing by 78 per cent to €1.18bn, analysts said a strong balance sheet should help Ryanair to weather the crisis. The company held €4.5bn in cash at the end of September.
O’Leary: new measures “cover up for political mismanagement”
Chief executive Michael O’Leary used the publication of the carrier’s results to issue an attack on the UK government over its handling of the pandemic. He has called for a better test-and-trace system including passenger tests within 32 hours of departure. He dubbed tighter lockdown measures which will come into force in the UK on November 5 as a “cover up for political mismanagement which the Johnson government continues to deliver.”
The company has also campaigned against state aid given to rival carriers since COVID-19 which he said would distort competition. The carrier has also warned that a no-deal Brexit could have “adverse trading consequences,” saying it hoped a deal could be reached to maintain free movement of people with a “deregulated airline market” to continue between the UK and Europe.
Air travel mismanaged by “uncoordinated travel restrictions”
Ryanair has so far kept its forecast to carry 38m passengers this financial year unchanged, but said it would revise the figures downwards should European governments “continue to mismanage air travel and impose more uncoordinated travel restrictions or lockdowns this winter”.