Ryanair (RYAAY) Q3 Earnings & Revenues Lag, FY24 View Tepid
Ryanair Holdings RYAAY reported third-quarter fiscal 2024 (ended Dec 31, 2023) earnings per share of 7 cents, which fell well short of the Zacks Consensus Estimate of 35 cents and declined 92.6% year over year. High fuel costs hurt the bottom line.
Revenues of $2.91 billion missed the Zacks Consensus Estimate of $2.96 billion. Revenues improved 23.1% year over year, driven by upbeat passenger volumes owing to the strong October 2023 mid-term and peak Christmas/New Year travel.
Due to high costs, RYAAY’s profit after tax was only €15 million in third-quarter fiscal 2024, down 93% year over year. Total operating costs increased 26% to €2.72 billion. The uptick was due to much higher fuel costs (up 35% to €1.2 billion), higher staff costs (reflecting pay restoration, crew, engineering and handler pay increases and higher crewing ratios) and the earlier timing of maintenance.
The load factor decreased to 92% in the reported quarter from 93% in the year-ago quarter. Average fares increased 13% year over year. Fares were softer than expected due to the sudden removal of RYAAY flights from many OTA Pirate websites in December 2023.
Outlook
Ryanair still expects traffic for fiscal 2024 to be 183.5 million despite headwinds like Boeing delivery delays. It has narrowed its fiscal 2024 view for profit after tax or PAT. The airline now expects fiscal 2024 PAT in the €1.85-€1.95 billion range (previous expectation was in the €1.85-€2.05 billion range).
Per Ryanair’s CEO, Michael O’Leary, “While we will benefit from the first half of Easter traffic falling in late March, this is unlikely to fully offset the weaker than previously expected load factors and yields late in the third quarter and early fourth quarter.”
Currently, Ryanair carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performances of Other Transportation Companies
Delta Air Lines’ DAL fourth-quarter 2023 earnings (excluding $1.88 from non-recurring items) of $1.28 per share comfortably beat the Zacks Consensus Estimate of $1.17. Earnings, however, declined 13.5% on a year-over-year basis due to high labor costs.
Revenues of $14.22 billion surpassed the Zacks Consensus Estimate of $14.07 billion and increased 5.9% on a year-over-year basis, driven by strong holiday-air-travel demand. Adjusted operating revenues (excluding third-party refinery sales) totaled $13.66 billion, up 11% year over year.
United Airlines UAL reported fourth-quarter 2023 earnings per share (excluding 19 cents from non-recurring items) of $2, which outpaced the Zacks Consensus Estimate of $1.61 but declined 18.7% year over year.
Operating revenues of $13.6 billion beat the Zacks Consensus Estimate of $13.5 billion. The top line increased 9.9% year over year due to upbeat air-travel demand. Cargo revenues fell 14.8% year over year to $402 million. Revenues from other sources jumped 10.6% year over year to $803 million.
J.B. Hunt Transport Services JBHT fourth-quarter 2023 earnings per share of $1.47 missed the Zacks Consensus Estimate of $1.74 and declined 23.4% year over year.
Total operating revenues of $3.3 billion beat the Zacks Consensus Estimate of $3.2 billion but fell 9.5% year over year. Total operating revenues, excluding fuel surcharge revenues, decreased approximately 6% year over year.
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