A year in chiaroscuro for Ryanair. The low-cost airline closed the 2018-2019 fiscal year with a profit of 1,02 billion euros. A considerable figure, but which represents a drop of 29% compared to 2017-2018. The decline, explains the company led by Michael O'Leary, is mainly due to the CEOincreased competition that forced Ryanair to sell their tickets at an even lower price. The result disappointed the consensus: Ryanair was expecting a profit of between 1 and 1,1 billion euros.
The increased competition risks creating many difficulties also for the current fiscal year (2019-2020). It is no coincidence that Ryanair prefers to adopt a cautious approach to guidance, estimating a further – but slight – drop in net profit, which should be between 750 and 950 million euro. The managing director, Michael O'Leary explained that the drop in profits "is due to the strong competition in the short-haul air transport sector in Europe, which pulls down the price of air tickets for all the players". The Irish group has lowered its fares by 6% to an average of 37 euros per ticket.
Turning to revenue, turnover rose by 6% to 7,56 billion euros, while thanks to the drop in prices, traffic grew by 7% to 142 million passengers, including Lauda. Ancillary sales – those “collateral” that exclude the cost of tickets – showed a strong performance with a growth of 19% to 2,4 billion euros, which led to a growth in revenues of 6% to 7,6 billion. , said CEO O'Leary.
We remember that Ryanair changed its baggage policy twice in 2018. From 1 January it has no longer allowed trolleys to be carried on board (in addition to the small bag), but has established the obligation to take them on free of charge. From 1 November, luggage weighing up to 10 kilos, i.e. small trolleys that many passengers use as "hand luggage", are embarked in the hold for the price of 8 euros. To take them on a flight, you need to pay the Priority fare which allows you to take a small bag on the plane (the maximum dimensions have gone from 35cm x 20cm x 20cm to 40 x 20 x 25cm) to slip under the seat and the trolley to store in the hatboxes.
Returning to the accounts, the group also announced thelaunch of a buyback plan of 700 million euro.
After the dissemination of the accounts, on the London Stock Exchange the Ryanair title travel is down sharply, dropping 2,3% to 10,56 euros.
