Ryanair’s Q1 FY2024 Results Reveal Slower Bookings in June and July 2023

In their recent Q1 FY2024 results presentation, Ryanair issued a warning about a slowdown in bookings during June and July 2023. The airline’s Chief Financial Officer (CFO), Neil Sorahan, mentioned that despite a strong demand, there was a softening in close-in bookings towards the end of June and early July 2023. He added that they will closely monitor the situation in August and September 2023, which will be crucial for their H1 FY2024 performance, spanning from April 1 to September 30, 2023.

However, Sorahan reassured that, as of now, both bookings and fares are ahead of last year’s figures. On the other hand, Ryanair’s Chief Executive Officer (CEO), Michael O’Leary, acknowledged that the economic slowdown will impact the airline’s H2 FY2024, given their ambitious growth targets. Ryanair aims to grow by 23% in Europe, with plans to add around 30 to 40 million passengers to their pre-COVID volumes.

O’Leary believes that stimulating prices will be essential to maintain their 25% growth in the second half of the year. He remains confident that Ryanair’s cost advantage will shield them from potential downturns in H2 FY2024, and an economic slowdown might even contribute positively to the airline’s growth. O’Leary explained that people will continue to fly but become more price-sensitive, leading to a shift towards choosing Ryanair across various European markets.

Despite this optimistic outlook, Ryanair has revised its FY2024 guidance due to Boeing delivery delays. The airline now expects to carry around 183.5 million passengers instead of the previously projected 185 million passengers for the year.

Ryanair’s recent Q1 FY2024 performance was remarkable, boasting a net profit of €663 million ($734.1 million), significantly higher than the €170 million ($188.2 million) in Q1 FY2023. The surge was attributed to robust flight demand during the Easter period, an extra holiday in the UK due to the coronation, and improved performance compared to the weak Q1 FY2023, which was affected by Russia’s unlawful invasion of Ukraine.

During the three-month period, Ryanair carried 50.4 million passengers and earned €3.65 billion ($4 billion) in revenue with an average load factor of 95%. Their fleet included 558 aircraft, featuring 119 Boeing 737 MAX-8200 “Gamechangers.” Furthermore, in May 2023, Ryanair placed an order for 150 Boeing 737 MAX-10 aircraft with an option for an additional 150. Shareholder approval during the Annual General Meeting (AGM) in fall 2023 will finalize the deal, with deliveries expected between 2027 and 2033.

However, Ryanair anticipates an increase in exfuel unit costs this year, approximately €2, due to crew pay restoration, higher crew ratios, increased ATC and route charges, and the impact of Gamechanger delivery delays. Despite the challenges, Ryanair remains optimistic about its position in the market and the potential for continued growth in the face of the economic slowdown.