Ryanair has warned it will take a €200m loss in its fiscal first quarter as the low-cost carrier expects the number of passengers flying this year will be about half of its original target due to coronavirus.
The Dublin-based airline said on Monday it expected to carry 80m passengers during its current fiscal year, which started in April, from its original goal of 154m passengers.
Ryanair said it expected to post a “smaller loss” in the peak summer second quarter than in the first three months of its financial year, as it expected it would still have to contend with coronavirus restrictions that have grounded most of its fleet.
The warning over “difficult” trading came as Ryanair reported €1bn post-tax profit for the year to March 2020, after the start of Covid-19 groundings that month, which reduced profit by €40m and full-year traffic by more than 5m passengers. The annual profit was still 13 per cent higher than in the previous year.
Ryanair has also taken a €353m hit due to a wrong-way bet on the cost of jet fuel in the current year because of plunging prices in the wake of the coronavirus crisis.
The airline said it could not provide full-year profit guidance for 2021 at this time because of “uncertainty over the impact and duration” of the Covid-19 pandemic. It expects to operate less than 1 per cent of its scheduled flying programme in the first fiscal quarter, from April to June.
While Ryanair expects “some return to flight services” in the July-September quarter, the airline said it would carry “no more than 50 per cent of its original” quarterly traffic target of 44.6m because of health restrictions such temperature checks and face coverings for passengers and staff and quarantine requirements.
The carrier has pledged to return 40 per cent of its normal flight schedule from July 1 but in recent days has condemned as “nonsense” a UK plan for a 14-day quarantine for passengers arriving in the country.
As it hit out at rescue packages for Lufthansa, Air France-KLM, Alitalia and others, the airline said it would not request or receive state aid.
It is in talks with staff and unions about base closures, pay cuts of up to 20 per cent, unpaid leave and up to 3,000 job cuts, mainly pilots and cabin crew.
The airline said Boeing expected a “late summer” return to service in the US for its 737-Max aircraft, whose grounding after two fatal crashes has delayed deliveries of a plane that Ryanair regards a “game-changer” because it has more seats but burns less fuel than similar narrow body jets.
Citing coronavirus however, Ryanair said it remained “in active negotiations” with Boeing to reduce planned deliveries in the next 24 months to reflect slower traffic growth post-Covid-19 in 2020 and 2021.