U.S. markets closed
  • S&P 500

    4,455.48
    +6.50 (+0.15%)
     
  • Dow 30

    34,798.00
    +33.18 (+0.10%)
     
  • Nasdaq

    15,047.70
    -4.54 (-0.03%)
     
  • Russell 2000

    2,248.07
    -10.97 (-0.49%)
     
  • Crude Oil

    73.95
    +0.65 (+0.89%)
     
  • Gold

    1,750.60
    +0.80 (+0.05%)
     
  • Silver

    22.42
    -0.26 (-1.16%)
     
  • EUR/USD

    1.1718
    -0.0029 (-0.25%)
     
  • 10-Yr Bond

    1.4600
    +0.0500 (+3.55%)
     
  • GBP/USD

    1.3681
    -0.0040 (-0.29%)
     
  • USD/JPY

    110.6850
    +0.3840 (+0.35%)
     
  • BTC-USD

    42,554.66
    +336.83 (+0.80%)
     
  • CMC Crypto 200

    1,067.20
    -35.86 (-3.25%)
     
  • FTSE 100

    7,051.48
    -26.87 (-0.38%)
     
  • Nikkei 225

    30,248.81
    +609.41 (+2.06%)
     

Ryanair (RYAAY) Q1 Loss Narrower Than Expected, Shares Gain

  • Oops!
    Something went wrong.
    Please try again later.
·4 min read
In this article:
  • Oops!
    Something went wrong.
    Please try again later.

Ryanair Holdings RYAAY incurred a loss of $1.46 per share in the first quarter of fiscal 2022 (ended Jun 30, 2021), narrower than the Zacks Consensus Estimate of a loss of $1.50. Following the earnings release, shares of the company gained 2.6% at the close of business on Jul 26.

The amount of loss, however, increased year over year due to cancelation of most Easter flights and slow easing of the European Union’s coronavirus-led travel restrictions in May and June. Although quarterly revenues of $446.4 million fell short of the Zacks Consensus Estimate of $459 million, it skyrocketed more than 100% from the year-ago period, which was characterized by significant decline in traffic owing to large-scale travel restrictions amid rising coronavirus cases.

Ryanair’s net loss for the quarter came in at €273 million compared with the year-ago quarter’s net loss of €185 million. Traffic jumped to 8.1 million customers in the reported quarter from a mere 0.5 million in the first quarter of fiscal 2021, thanks to increased capacity in May and June. Load factor in the period was 73%, a 12-percentage-point improvement from the year-ago period.

Ancillary revenues augmented to €178.6 million from only €24.5 million in the first quarter of fiscal 2021 due to significant improvement in traffic, and strong performance in priority boarding and reserved seating. With a “sevenfold increase in sectors flown”, the airline’s fuel and oil expenses surged to €157 million in the fiscal first quarter from €8.9 million in the year-ago period. With increased operations, total operating expenses climbed more than 100% year over year to €675 million. Ryanair, carrying a Zacks Rank #4 (Sell), had cash of €4.06 billion at the end of Jun 30, 2021 compared with €3.15 billion at the end of Mar 31, 2021.

Outlook

With the rollout of EU Digital Covid Certificates on Jul 1 and the relation of the United Kingdom’s quarantine rules for fully vaccinated travelers, Ryanair has witnessed accelerated recovery in bookings for the second quarter of fiscal 2022. However, fares are still way below pre-coronavirus levels, the airline stated. It now anticipates fiscal 2022 traffic to be in the range of 90 million-100 million (previous guidance: low end of 80 million-120 million). The company expects to either incur a small loss or break even in fiscal 2022, provided vaccine rollout continues this summer and the coronavirus situation remains under control.

With improving close-in bookings, the company estimates traffic to increase to about 9 million in July from more than 5 million in June. The same is predicted to be more than 10 million in August. The airline is seeing a strong pent up travel demand for August and September, which it expects to continue into the second half of fiscal 2022. Ryanair anticipates pre-coronavirus levels of growth in summer 2022.

Performance of Other Airline Stocks

Southwest Airlines LUV, carrying a Zacks Rank #3 (Hold), incurred a loss (excluding 92 cents from non-recurring items) of 35 cents per share in the second quarter of 2021, wider than the Zacks Consensus Estimate of a loss of 21 cents. Operating revenues of $4,008 million outperformed the Zacks Consensus Estimate of $3,942.5 million. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Delta Air Lines DAL, carrying a Zacks Rank #3, incurred a loss (excluding $2.09 from non-recurring items) of $1.07 per share, narrower than the Zacks Consensus Estimate of a loss of $1.41.  Total revenues of $7,126 million also topped the Zacks Consensus Estimate of $6,340.9 million.

American Airlines Group AAL, carrying a Zacks Rank #3, incurred a loss (excluding $1.72 from non-recurring items) of $1.69 per share, comparing favorably with the Zacks Consensus Estimate of a loss of $1.71. Operating revenues of $7,478 million also surpassed the Zacks Consensus Estimate of $7,425.6 million.


Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
 
Ryanair Holdings PLC (RYAAY) : Free Stock Analysis Report
 
Delta Air Lines, Inc. (DAL) : Free Stock Analysis Report
 
Southwest Airlines Co. (LUV) : Free Stock Analysis Report
 
American Airlines Group Inc. (AAL) : Free Stock Analysis Report
 
To read this article on Zacks.com click here.