European mammoth budget airline Ryanair has posted its biggest ever annual loss of €815 million for the 2020 financial year, in light of an 81 per cent drop in passenger traffic, after posting a €1 billion profit the previous year.
Ryanair called the 12 months to 31 March its “most challenging” year in its 35-year history, in light of COVID-19 lockdowns and ongoing travel restrictions, which wiped out demand and caused an “unprecedented” backlog of cancellation refunds.
The airline saw its passenger traffic figures plummet from 149 million passengers in the 2019 financial year to just 27.5 million.
In true Ryanair fashion, the airline pointed the finger on European governments for having an uncoordinated and non-uniform approach to travel restrictions and lockdown protocols, which caused the airline industry to suffer on multiple fronts.
However, despite the result, Ryanair is already eyeing a return to profit by the end of FY21, assuming the vaccine rollout continues to pick up steam in Europe, and no further disruptions are introduced to the sector.
It anticipates to carry 5-6 million passengers between April and June, and see a return to at least 80 million passengers for full-year 2021, in light of easing travel restrictions throughout the year.
“Unless there are some very adverse developments, either a fallover in vaccine delivery or some variant that looks like it’s resistant to the vaccine, all of the indications are that there’s going to be stronger demand than usual for European holidays,” said Ryanair’s chief executive, Michael O’Leary.
At the same time, Ryanair announced that its overdue delivery for new 737 MAX jets was again delayed in April, as Boeing halted deliveries on the embattled jet after locating electrical issues.
“We think the management of Boeing in Seattle has been very complacent,” O’Leary said on the matter, claiming the manufacturer had failed to properly manage its relationship with regulators.
The airline also confirmed that it received an undisclosed sum in compensation for the ongoing delays.
The news comes as the UK released its first post-lockdown ‘traffic light’ travel information list.
Travellers entering the UK from countries that sit on the ‘green’ list no longer require any period of self-isolation or quarantine, while countries on the ‘amber’ and ‘red’ lists have varying degrees of restrictions.
As it stands, just 12 countries are on the UK ‘green’ list for restriction-free travel.
Over the past few weeks, debate has been ongoing on whether or not the UK government will open itself up to other major European tourist destinations hubs, such as Spain, Greece and France.
O’Leary commented that despite uncertainty, Britons have been advance-booking flights to holiday destinations outside the current ‘green’ list, including Spain and the Balearic Islands, for the summer season.
He said this clearly shows passengers are “discounting short-term restrictions”, and trusting sources that suggest the UK will ease restrictions on a wider range of countries in another two weeks’ time.
According to internal Ryanair data, passengers made 500,000 flight bookings in the first week of April, which grew by over a million to 1.5 million by the second week of May – with bookings bolstered by 50 per cent in the last week alone.
Despite industry consensus that air travel will not return to pre-pandemic levels until 2024, Ryanair continues to state it intends to return to pre-COVID capacity numbers by 2022-23.