[ad_1]
For the reported Q1, the Ryanair revenue dropped by 95%. RYA stock lost over 8% after the statement was published.
Irish low-cost airline Ryanair Holdings Plc (LON: RYA) has posted a Q1 loss of 185 million Euros as the company records one of the most economically stranded experiences induced by the coronavirus pandemic. In the Q1 results reported, Ryanair detailed how its earnings have been impacted by the coronavirus pandemic which caused the airline to have drastic drops across all its performance indices.
Ryanair recorded over 99% of its fleet grounded from mid-March when most countries were already on lockdown to end June when the lockdowns were lifted. The company’s customers based and patronage dropped massively from 41.9 million to barely 500,000 representing a negative 99% change.
The past months’ performances compounded by the released results have plunged the stocks of Ryanair Holdings Plc (LON: RYA) which plunged by a huge 8.62% at 9.96 EUR. The underperforming firm has been pitched for a 205 million euro loss in the second-quarter report as projected by analysts polled by Refinitiv.
Harsh Bites by COVID-19
The coronavirus pandemic induced lockdown caused the grounding of Ryanair fleets for four months spanning March to June. As a means to join the fight against the damning virus, most of Ryanair’s planes as similar to other airline operators were used in the repatriation of customers, operated rescue flights for different EU Governments, as well as flying a series of medical emergency/PPE flights across Europe.
Following the ease of the lockdowns, Ryanair has resumed its flight but at 40% capacity in July. The airline expects normal operations to resume by 60% in August and 70% in September. To survive the coronavirus lockdown, Ryanair confirmed it cut the cost of its operations by over 85%. Doubted about how much the coronavirus will bring in the future, the company said in a statement:
“It is impossible to predict how long the Covid-19 pandemic will persist, and a second wave of Covid-19 cases across Europe in late autumn (when the annual flu season commences) is our biggest fear right now,”
While the coronavirus disease caused a significant loss for the company, it acknowledged it has been able to wedge strength owing to the fact that the virus had caused the closure of such airlines as Flybe, Germanwings, Level, and Sun Express.
Impact on Ryanair Q1 Revenue and Future Expectations
With the airline’s inability to complete booked flights, it fell under the obligation to refund customers, and Ryanair expects to complete over 90% of customer’s refund requests. For the reported Q1, revenue dropped by 95% (almost €2.2bn) to just €125m. While acknowledging the current realities, Ryanair expects the 2021 Financial Year traffic to fall by 60% (from 149m) to just 60m as the world recovers fully from the impacts of the COVID-19 pandemic.
The bearish projection for future expectations is also influenced based on the no-deal Brexit, whose challenge, the company says is high. As an EU airline, the no-deal Brexit will not affect the company as much as it may affect UK owned airlines but the company hopes that:
“..before the end of the Transition Period in Dec., that the UK and Europe will agree a trade deal for air travel which will allow the free movement of people and the deregulated airline market between the UK and Ireland to continue,” the statement in the official presentation reads.
Benjamin Godfrey is a blockchain enthusiast and journalists who relish writing about the real life applications of blockchain technology and innovations to drive general acceptance and worldwide integration of the emerging technology. His desires to educate people about cryptocurrencies inspires his contributions to renowned blockchain based media and sites. Benjamin Godfrey is a lover of sports and agriculture.
[ad_2]
Source link
