(AOF) – Ryanair (-1.74% to 18.37 euros) is down after the publication of a net profit of 15 million euros in the third quarter, down some 93% over one year. The low-cost airline also reduced its 2024 annual net profit forecast to a range of 1.85 to 1.95 billion euros, compared to 1.85 to 2.05 billion previously. Ryanair cites lower than expected occupancy, salary increases, delivery delays from Boeing, as well as the partial elimination of free ETS carbon credits (from January 1).
“We now expect non-fuel unit costs for the 2024 financial year to increase by around 2.50 euros” which will further widen the cost gap between Ryanair and the main European airline competitors,” specifies the company .
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Results weakened again for European companies
While fuel represents up to 35% of their costs, professionals estimate that European airlines are not expected to return to profit before 2023 or 2024 at the earliest. These players predict that energy prices would remain high at least until 2023. The International Air Transport Association (IATA) announced a forecast of cumulative losses of $9.7 billion in 2022 for airlines to across the world we will still have to wait until 2023 to see a return to profits on a global scale, particularly due to the surge in oil costs and the increase in labor costs. Positive point: travel demand seems to be resisting the uncertainties caused by the international economic and political situation. However, uncertainties regarding Covid, the war in Ukraine, as well as rising prices are increasing last-minute reservations. According to Iata, only 8% of international reservations made at the end of May went beyond September.
The social climate is deteriorating in low-cost airlines
These companies are benefiting from a very strong recovery. They had already managed to monopolize 40% of air traffic in 2021, this proportion could even rise to 50% this year. However, strike movements have affected the activity of Volotea, EasyJet and Ryanair, with confrontations over remuneration and working conditions. Generally speaking, the sector is facing a shortage of personnel. After having severely cut their workforce in 2020 and 2021, companies and airports must urgently recruit to support the resumption of activity.