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Ryanair posts first summer loss in decades; flags winter capacity cut
[DUBLIN] Ireland's Ryanair Holdings posted a loss for its key summer period for the first time in decades on Monday, and said it may have to cut capacity further this winter as a second wave of Covid-19 infections sparks fresh lockdowns across Europe.
Europe's largest low-cost airline said Covid-19 restrictions pushed passenger numbers down 80 per cent in the six months to Sept 30, when it typically makes most of its annual profit.
Instead, it posted a loss of 197 million euros (S$313.4 million) for the first half of its financial year, versus profit of 1.15 billion in the same period last year. A company poll of analysts had on average forecast a loss of 244 million euros.
The airline, whose chief executive Michael O'Leary in September described the upcoming winter as a "write-off", declined to forecast profit for the full financial year ending March 31, but said it expected a second-half loss greater than the first.
Ryanair reaffirmed plans to fly 38 million passengers this financial year compared with the 149 million of the same period last year, and said the number could fall further "if EU (European Union) governments continue to mismanage air travel and impose more uncoordinated travel restrictions".
Ryanair, which has one of the airline industry's strongest balance sheets, said it had cash on hand of 4.5 billion euros at September-end and aircraft worth about seven billion euros. It said its cash balance was supported by a 250 million euro supplier reimbursement from Boeing in the July-September quarter.
The airline has only posted one annual loss in the past 30 years, in 2009. It still made a small profit in the summer of that year.
Ryanair said it had yet to finalise terms with Boeing on compensation for the 18-month delay of deliveries of the grounded 737 MAX jet. It said it hoped to receive the first 30 MAX jets in time for its peak summer season next year.
"Discussions are ongoing with aircraft suppliers to amend pricing to reflect the new Covid-19 reality," the airline said.