Ryanair results April to June quarter 2027 Q&A https://youtu.be/ICllKXylIiQ

Yeah, as always, a number of moving parts in there. Firstly, traffic performed well, rising 6% thanks to the extra game changers in the fleet. Fares, however, were down 6%. Some of that we would credit to the timing of Easter. We had a full Easter in the first quarter last year. Half of Easter fell into the fourth quarter of the year just gone. So we didn't have the full benefit there. But importantly, we saw some consumer hesitancy in relation to the Middle East war that led to more price stimulation and closer in booking. So fares are down 6% as a result of that. Similarly, the Middle East had an impact on the price of our unhedged fuel. We saw the cost of our 20% unhedged fuel spike; it doubled to $150 a barrel. Ancillaries, however, put in another solid performance, rising 5% to 1.47 billion or broadly flat on a per passenger basis at 24 per passenger.

So, as we've said, FY27 jet fuel is 80% hedged at $67 a barrel. We've now hedged 15% of FY28 at $85 a barrel. FY27 OPEX is 90% hedged at $1.15 to the euro and H1 of FY28 is 30% hedged at $1.20 to the euro. Moving to the balance sheet. Ryanair's balance sheet continues to be industry leading. What would he call it? Yeah, it's a fortress balance sheet. We've over 620 fully unencumbered Boeing 737s on the balance sheet which is quite unique for an airline. We're debt free, having paid off our 1.2 billion remaining bond in May just gone. And we've got very strong investment grade ratings, triple B+ from both Fitch and S&P. Liquidity strong. We finished the quarter at the end of June with over 2.8 billion in cash. And to put that in context, that was after paying down 1.3 billion in debt, half a billion in capex. And then that liquidity is further supplemented by our revolving credit facility. We have a 1.1 billion RCF, which is substantially undrawn. So this is a huge competitive advantage for Ryanair. Our competitors are taking on expensive long-term debt. They're taking on expensive leases. And importantly, they don't have the hedge lines to hedge out their fuel and their dollar. So that's adding to their burdens over the next number of years.

Well, firstly is to fund the Max 10 introduction and the pre-delivery payments on that order book. We're beginning to fund the two MRO engine shop capex. We also need to fund the balance of our dividends as another interim final dividend payable in September and complete the 750 million share buyback. Thereafter, we want to rebuild group's gross cash to four billion euros and anything surplus to that will be returned to shareholders via dividends and buybacks.

Well, thanks to the strength of the balance sheet and our strong investment grades, we can and we'll continue to be opportunistic in what we do. I mean, it'll ultimately boil down to what's the lowest cost of finance for Ryanair. At the moment it's cash, but I would expect over the next number of years we'll probably go back to the debt markets, whether it's the banks or the bonds. So likely a combination of cash and debt.

We're guiding approximately €2 billion euros. But that's subject however to the timing of the engine shop capex.

Yeah, it's fairly well hedged. If you look at the 150 firm orders that we have, we're now 60% euro-dollar hedging in place at just over 1.23 on the euro-dollar. So, we're locking in very good levels on what was already a keenly priced order book from Boeing.

Uh we expect the final dividend of 19.5 cents per share will be payable in September subject to AGM approval.

Yeah, it's progressing very well. We're now over 90% of the way through that buyback. So I would expect that it'll probably run out somewhere towards the back end of September. So as of today, we've bought back and cancelled well over 25 million shares at an average price of 26 euro 35. And when we're finished the buyback in September, we'll have returned and cancelled nearly 40% of our issued share capital since 2008.

We believe so. Again, as I spoke to Boeing last week, they're pretty confident that the Max 10 will be certified sometime in September, October of this year, well in advance of our first 15 deliveries in the spring of 2027. Boeing have confirmed that they've protected those 15 deliveries, our first 15 deliveries in the spring of 27. Um, so we're growing increasingly confident that we'll have those aircraft in time for summer 2027. And again come back to the fundamental point: 300 of these aircraft with 20% more seats burning 20% less fuel will facilitate profitable growth to 300 million passengers annually by 2034.

Oh I think it remains constrained for some time to come at least out to 2030 if not beyond. If you look at the two big OEMs, Boeing and Airbus, while they're starting to improve on their production, they're still way behind on their deliveries and very much dependent on the engine manufacturers for growth over coming years. Pratt and Whitney continue to work through their GTF engine issue, which impacts a lot of A320 operators and consolidation is accelerating here in Europe. We've got the TAP takeover process ongoing. But interestingly, we have a number of bids now in relation to easyJet, which I believe will collectively take more capacity out of the market. And then of course this winter, weaker carriers are being hit by very high oil prices. Very strong dollar. And I think this will lead to some casualties and capacity in the market as well. Where's Ryanair most focused on growing? Again, in our constrained capacity, we focus on switching that scarce growth to those states who are abolishing taxes, cutting ATC fees, those regions and airports who are incentivizing growth. That means, for example, this summer we're switching a lot of capacity away from high-cost, high tax countries like Vienna in Austria, Berlin in Germany, Dublin airport, which has increased fees this year, and regional Spain, switching that capacity to new low-cost destinations like Slovakia where the government has abolished environmental taxes, cut ATC fees and Bratislava airport has come up with a very aggressive growth incentive scheme, as a result of which they've grown their traffic by about 150% year-on-year. But other examples of that are Albania, Tran in Albania, Italy, there are four regions of Italy that have abolished their municipal taxes, Morocco and Sweden where they've abolished both environmental taxes and are now reducing ATC fees as well. This summer we've opened three new bases: Rabat in Morocco, Tran in Albania, Trap in southern Italy, all of which are performing very well and we're selling 130 new routes to consumers in summer of 2026.

It's all very much on track. We would hope to be in a position to announce the first of the two locations towards the back end of this year, start construction in early 2027 and then have the first shop operational in early 2029. The second shop would then likely come online somewhere in the early 2030s.

Well, firstly, the aircraft 20% more seats. They burn 20% less fuel and fuel is by far and away our biggest cost. We have a very low cost pricing on that 300 aircraft order because they were ordered and priced during COVID. We believe the Max 10 will significantly improve productivity. If you go back to slide four on the crewing line, airport and handling line, maintenance warranties, and therefore they will improve unit costs across that slide. It'll also enable us to drive ancillary revenues because we're carrying 20% more passengers per flight. And at the top line, we believe that this order of aircraft will enable us to grow safely and profitably to 300 million passengers annually by 2034.

Well, we're still very much targeting 216 million passengers this year. That's a 4% increase. That's skewed slightly towards the first half of the year where we're growing by 6% thanks to the deliveries of the game changers over the winter just gone and then slower growth into the second half of the year where we grow by just 2%. Our strong fuel hedging not only derisks our earnings, we're 80% hedged at $67 a barrel, but it helps offset increasing ETS environmental costs. They're up 300 million this year. Rising pay increases as part of multi-year CLAs that are ongoing at the moment and then some increased maintenance. But if we look at the full year costs, I mean the full year unit costs are going to totally hinge on what happens to our unhedged fuel for the balance of the remaining quarters of this year. Looking towards demand, as Michael already said, demand is robust into the peak summer period, but the booking window remains somewhat closer in. Still needs a little bit more stimulation and fares are trending modestly down year on year. So, we don't really have the close in visibility into August and September and that'll totally determine where the H1 outcome lands. As regards H2, as is normal this time of the year, absolutely zero visibility. Um, so based on all of that, it's just far too early to give full year profit after tax guidance. I would, however, again focus in on the Max 10s. The first starts delivering the spring of next year. 300 of these phenomenal aircraft coming in, very fuel efficient, 20% more seats, 20% less fuel burn, and they'll drive our sustainable, profitable growth to 300 million passengers by March 2034.