Budget airline Ryanair posts 273 million euro loss as Covid continues to wreak havoc

Low-cost airline Ryanair said Monday that it’s still facing a “challenging” environment and that it might finish the fiscal year “somewhere between a small loss and breakeven” as Covid-19 restrictions linger.

The Irish firm reported a 273 million euro ($322 million) loss for the period between April and June, as lockdowns meant most flights over the Easter period were canceled and with European nations being cautious over the easing of travel restrictions. The figure beat a forecast from analysts which was compiled by the company.

“Covid-19 continued to wreak havoc on our business,” Ryanair CEO Michael O’Leary said in a statement Monday.

At the same time, operating costs also increased, deteriorating the company’s balance sheet. Over the year to June, costs rose by 116%, driven mostly by fuel, airport and route charges.

However, O’Leary expects traffic to pick up in the coming weeks.

“We expect traffic to rise from over 5 million in June to almost 9 million in July, and over 10 million in August, as long as there are no further Covid setbacks in Europe,” he said.

Ryanair shares are up 42% from a year ago. They traded 2.5% higher in early European deals Monday on the back of the results.

“Ryanair is still at the mercy of the virus and, although a recovery is materializing, the group noted that travel within Europe will be depressed for the foreseeable future,” Laura Hoy, equity analyst at Hargreaves Lansdown, said via email.

“We’re encouraged by the group’s progress, but it may have to toe the precarious line between low fares and high costs for some time.”

Silvia Amaro www.cnbc.com