Ryanair cautious about ‘fragile’ recovery and berates Boeing

Ryanair planes are seen at dawn at Dublin Airport Dublin, Ireland March 20, 2018. REUTERS/Clodagh Kilcoyne

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  • Ryanair reduces its annual loss to 355 million euros
  • Low-cost carrier says caution is in order as winter approaches
  • O’Leary: Boeing management should step up or ship
  • Worried competitors talk too much about summer

DUBLIN, May 16 (Reuters) – Ryanair (RYA.I) said on Monday it was unable to give detailed guidance for 2022 beyond hope for a return to “reasonable profitability” amid an economic downturn. uncertainties over COVID-19 and the war in Ukraine, sending its shares tumbling despite a smaller annual loss.

Europe’s biggest airline by passenger numbers also became the latest Boeing customer BA.N to criticize the aircraft maker. Chief Executive Michael O’Leary said his management needed to step up and deliver the planes faster or make way for a new team.

Ryanair recorded a loss of 355 million euros ($369 million) for the 12 months marked by the pandemic to March 31 and said it expected to increase traffic to 165 million passengers this year, up from 97 million a year ago and a pre-COVID-19 record of 149 million.

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However, O’Leary said it was “impracticable, if not impossible” to provide a reasonable or specific target until the second half of his fiscal year.

He added that while bookings had improved in recent weeks, he was a bit concerned that competitors were talking too much about the summer recovery and that caution was needed as a winter approached with a slowdown. economic expected.

“It’s too fragile, there are too many moving parts left,” O’Leary said, adding that Ryanair would nonetheless thrive if any of its markets plunged into recession due to its weaker cost base.

Chief Financial Officer Neil Sorahan told Reuters that rates have been lower in recent weeks than expected. While he’s cautiously optimistic peak summer fares will be “somewhat ahead” of pre-pandemic levels, O’Leary said winter pricing is impossible to predict.

Customers were also still waiting much closer than usual to the time of their trips to book.

Ryanair shares ended down 0.2%.

BOEING CRITICISM

O’Leary also said that if Ryanair remains a willing Boeing customer and hopes to receive more 737-8200 jets than expected over the next two summers, it could turn to the second-hand leasing market to fuel growth. additional unless Boeing steps up with some additional orders.

Ryanair has issued a tender for 50 jets, according to industry sources.

Last year, Ryanair backed out of negotiations with Boeing for 200 of its largest single-aisle aircraft: the upcoming 737 MAX 10.

O’Leary on Monday described Boeing’s management as “running like headless chickens” and said “they really need to improve.”

“Boeing needs a management restart in Seattle and either the existing management needs to up their game or they need to change the existing management,” O’Leary told analysts.

Boeing declined to comment.

O’Leary has consistently lambasted Boeing over the past year in what many industry executives saw as a stalled tactic in negotiations to buy MAX. Read more

But his latest comments coincided with broader pressure on Boeing after two leasing industry leaders, Air Lease Corp (AL.N) executive chairman Steven Udvar-Hazy and Avolon CEO Domhnal Slattery, questioned his leadership. Read more

In contrast, the boss of the world’s largest lessor, AerCap (AER.N) boss Aengus Kelly, backed Boeing last week and said he would overcome recent problems. Read more

Boeing shares fell 2.5%.

In late April, Boeing expressed doubts about meeting jet delivery targets as technical issues, inflation and supplier risks clouded its recovery. Read more

Boeing CEO Dave Calhoun said at the time, “We’re going to deliver great planes. And we’re going to recognize the costs associated with that.”

O’Leary said Ryanair, which has covered 80% of its fuel needs for 2023 and 10% for 2024, would likely be profitable in the coming year even if the outlook was worse than expected, but that they would be significantly behind pre-pandemic levels. .

($1 = 0.9619 euros)

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Reporting by Conor Humphries and Padraic Halpin, Alistair Smout and William James in London, Tim hepher in Paris; Editing by Kirsten Donovan, Alison Williams and Richard Pullin

Our standards: The Thomson Reuters Trust Principles.

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