Ryanair posts first profit since Covid but mulls London delisting

posted on 1st November 2021 by Eddie Saunders
Ryanair posts first profit since Covid but mulls London delisting

By Emily Hawkins | cityam.com

Budget airline Ryanair has reported its first quarterly profit since the start of the pandemic, with shares going up to €16.96 compared to €16.46 registered earlier this morning.

However, the Irish-based group said it still expected to post an annual loss of up to €200m (£195.4m) as it would need to discount tickets this winter.

Michael O’Leary, the outspoken boss of the budget carrier, told media the airline was mulling a delisting from the London Stock Exchange.

Ryanair reported an after-tax loss of €48m for the six months to September, slightly higher than the €43m predicted by analysts.

A €273m loss for the first quarter implies a second quarter profit of €225m, the airline’s first quarterly profit since October-December 2019.

Some 39.1m passengers flew with Ryanair in the six months to September, 54 per cent fewer than in the comparable pre-pandemic period.

It is expected to post a loss around €100m and €200m for the financial year ending March 31.

O’Leary lifted the group’s five-year growth target to fly 225m passengers a year by 2026, from a previous forecast of 200m.

It increased its passenger target for the financial year to March 2022 to slightly above 100m. This is compared to 149m passengers per year before the coronavirus outbreak.

O’Leary pointed to the rollout of the EU Covid passport as the main driver of a return to short-haul travel.

It said it expected to return to pre-pandemic profit levels in the year ending March 2023.

On a potential de-listing, which he put down to the Brexit vote, O’Leary said it would likely happen in the next six months.

“Trading on the London Stock Exchange as a percentage of overall trading volume in Ryanair’s ordinary shares has reduced materially during 2021.

“The migration away from the LSE is consistent with a general trend for trading in shares of EU corporates post-Brexit and is, potentially, more acute for Ryanair as a result of the longstanding prohibition on non-EU citizens purchasing Ryanair’s ordinary shares being extended to UK nationals following Brexit.

“The board of Ryanair is now considering the merits of retaining the standard listing on the LSE. Ryanair has a primary listing on the regulated market of Euronext Dublin, which offers shareholders the highest standard of protection.”

Jonathan Sullivan, managing director in Accenture’s travel industry, said: “Airlines that relied heavily on business travel may still be in the depths of recovery mode, and more leisure oriented low-cost carriers have been able to capitalise on the pent-up demand over the summer months, making the ramp up easier.”